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Tri State Lottery Commission
January 5, 2007
Meeting Minutes:

TRI-STATE LOTTO COMMISSION
New Hampshire Lottery Commission
Concord, NH

January 5, 2007, 10:30 a.m.

Present:        Orland McPherson, Maine State Lottery
                   Richard Campbell, New Hampshire Lottery Commission
                   Thomas Scala, Vermont Lottery
                   Pam Coutts, Maine State Lottery
                   Rick Wisler, New Hampshire Lottery Commission
                   Alan R. Yandow, Vermont Lottery
                   Lisa Rodrigue, Maine State Lottery
                   Rich Sperlazzi, Maine State Lottery
                   Maura McCann, New Hampshire Lottery Commission
                   Gweneth Dean, Vermont Lottery
                   Mary Cassani, Vermont Lottery
                   Russ Leonard, NL Partners
                   Chris Nichols, NL Partners
                   Jennifer Cartnell, NL Partners
                   Rose Longo-White, Griffin, Bodi Krause
                   Liz Dimmick, Scientific Games
                   Carole Lacasse, Vermont Lottery Commission

Chairman McPherson called the January 5, 2006 meeting to order at 10:30 a.m.

An Administrative Hearing was held regarding the Suspension of the Iron Works Market License.

ACCEPTANCE OF THE DECEMBER 1, 2006 MINUTES
A motion was made by Commissioner Campbell to accept the December 1, 2006 minutes with a date change and a notation to be sure to use full names when referencing staff/commissioners in the minutes. Motion was seconded and voted in the affirmative.

FINANCE COMMITTEE – Mary Cassani
Gross revenues for Tri-State through November 2006 have increased $1,331,838, or 5.2% compared to last year. Of this increase, Megabucks sales are up $316,634, or 2.5%; Daily Numbers sales are down $28,910, or 0.3%; Triple Play sales are down $631,764, or 21.8%; and the Promotional Add-A-Play games increased sales $1,675,878.

Total expenses through November 2006 were up over last year to date $565,445. This includes an increase in cost of sales of $75,429, attributable to the additional prize expense vendor fees and commissions, coupled with a decrease in operating costs of $184,984 which reflects a decrease in advertising and promotional expenses.

Net Profit through November 2006 increased from last year to date $920,108, or 10.6%.

Contingency Funds at the end of November were all in the positive. Expired unclaimed prizes were over $1.5 million.

Vermont’s most recent winner for the January 3rd draw was a guaranteed jackpot of $500,000. If the winner elects to take the annuity option, the cost to the guaranteed jackpot fund will be approximately $230,000. If the cash option is chosen, the cost to the guaranteed jackpot fund will be approximately $178,000. There is currently enough in the fund to pay either option.

MARKETING COMMITTEE – Maura McCann
The press clip report was distributed -- only two clips, both from Vermont, on the $4.47 million Megabucks winner.

The last day and draw of Triple Play is January 12th. The committee met recently regarding the last draw to be sure everyone is on board with what will happen if there is a jackpot winner and if there is not a jackpot winner. Sales for the new game, Paycheck, begin January 17th with the first draw Friday, January 19th. Each of the states brought samples of their Paycheck advertising pieces.

DEVELOPMENT COMMITTEE – Pam Coutts
Software testing is currently being done and issues have been shared with each state. This has worked very well.

There was a brainstorming session in December regarding new Add-A-Play concepts and a decision was made to go with a baseball game as a stand alone in April. New concepts were discussed and include Pocket Change, AlphaBet, Lucky Number and a fishing game. Additional games were discussed. It was a very productive meeting.

The committee is still working on the concept of the Raffle game. One idea was to use the money to seed it to get it to a million dollar prize. There was a preliminary discussion as well as a discussion as to how much seed money would be necessary to come up with a prize structure that would be attractive to the players. There are on-going discussions on this game and various concepts.

At the last Tri-State meeting, there was a discussion on the verbiage on the claiming period and whether or not changes were necessary. The committee is not ready at this time to recommend or make any changes. The committee is still working with the Iowa Lottery and Scientific Games regarding the language that should be used.

DRAW COMMITTEE – Maura McCann
The cable for the Tri-State Megabucks machine/remote needed to be replaced. SmartPlay was contacted, the necessary repairs were made and a new 15-foot remote cable was purchased for the draw machine/remote.

Maura McCann has updated the draw report and jackpot sheet for the new Paycheck game. The new balls are here. The old Triple Play machine will be used to draw the winning numbers for the new Paycheck game. MOTION A motion was made by Commissioner Scala to authorize the expenditure of $525 to purchase a new cable and repairs to the Tri-State Megabucks machine/remote. Motion was seconded and voted in the affirmative.

OPERATIONS COMMITTEE – Gweneth Dean
As previously mentioned by Pam Coutts, the staff testing for the new Paycheck game all shared their findings with each other. This is the first time there was shared communication during the testing and staff found it very useful. This type of testing format will continue in the future.

There was a conference call yesterday to discuss the Triple Play last draw procedures. Everyone will be working ICS and a procedure has been set in place to communicate either a jackpot draw down to the other prize levels or if the jackpot is won. If the jackpot drops down to the other prize levels, we have procedures in place to communicate the new prize tier levels through the lottery terminals. Vermont will put it on our web site. It will also be on the winners’ report. We will communicate the prize tier levels throughout the long weekend. The Paycheck procedures are the same as the Megabucks procedures except in a different form.

SCIENTIFIC GAMES - Liz Dimmick
Scientific Games has been providing the logo for Add-A-Play. There have been numerous Raffle games finishing up the end of the year. Scientific Games’ game designers are looking at them to see which ones have been successful and checking to see if there is a common thread for all the Raffle games that have been conducted. There were as many as nine to eleven states offering the Raffle game during the holidays.

ACCEPTANCE OF THE COMMITTEE REPORTS
A motion was made by Commissioner Scala to accept the Committee Reports as presented. Motion was seconded and voted in the affirmative.

OTHER BUSINESS
Commissioner Campbell raised the issue of a cancellation policy during a promotion. Director Wisler requested the Development Committee to look into the issue and report back to the commission.

There was also a discussion on various types of promotions used in the past.

Iron Works Market Hearing Discussion:

The Tri-State Commissioners discussed various facts and figures presented during the hearing. The Iron Works Store Manager (Jalpa Patel) admitted she was wrong in what she did. The commission does not know if the owner, Suresh B. Patel, is aware of what Ms. Patel did and that the terminal has been shut down. There is an appeal process if the owner elects to do so. MOTION A motion was made by Commissioner Campbell to revoke the license issued to Iron Works Market in Gilmanton Iron Works, New Hampshire for one year after which time they can reapply for a license. Motion was seconded and voted in the affirmative. A letter will be drafted, forward to commissioners and directors for their review, and finalized for Chairman McPherson to sign and send out.

The next regular commission meeting is scheduled for Friday, February 2, 2007, at the New Hampshire Lottery Commission, Concord, NH.

A motion to adjourn was made by Commissioner Campbell. Motion was seconded and voted in the affirmative.