Raleigh, N.C. — North Carolina's lottery would spend more on advertising if the proposal a legislative oversight committee approved Thursday becomes law.
The General Assembly returns to session on April 25. In preparation, oversight committees are creating packages of proposed bills for lawmakers to review. At this stage, such bills are only recommendations, but they do carry the advantage of having been vetted in advance of the busy legislative session.
In the case of the lottery bill, the Joint Legislative Oversight Committee on the North Carolina State Lottery has suggested raising the amount of money the state-run gambling enterprise can spend on advertising from 1 percent to 2 percent of annual revenue.
That additional flexibility, said lottery director Alice Garland, would allow the games to do more advertising to alert players of big jackpots and to carry out "significantly more digital advertising," as well as put more ads on television.
"This will allow us to be on the radio pretty consistently," she said.
Right now, she said, there are certain times of year when the lottery is not able to air broadcast advertisements due to the limitations on advertising.
Adding to the game's advertising budget would likely generate an additional $48 million – over and above the cost of the additional advertising – in the first year and $56 million more in the second year, Garland said.
Lawmakers have restricted lottery advertising since the game's inception. The lottery is not supposed to advertise in such a way that induces people who would not ordinarily play to buy a ticket, a nebulous and hard to quantify standard. Additionally, the amount of money that the games have been able to spend on advertising has been limited.
If the lottery hits a projected goal of bringing in roughly $2 billion in revenue, doubling the advertising budget would take the game from spending roughly $20 million on advertising a year to $40 million.
"That is a significant increase in the amount of advertising out there," said Rep. Nelson Dollar, R-Wake, one of several members of the committee who were skeptical of the need for such a big jump.
Dollar noted that some lawmakers have already been advancing a bill that would further limit lottery advertising and require more disclosures.
"I can assure you there will be substantial discussion on adding those provisions to any legislation that's introduced," Dollar said.
In additional to expanding the amount of advertising the lottery could do, the committee's draft bill would also explicitly prohibit the lottery from adding video lottery terminals or slot machines to its stock of games. However, Garland said that current law already restricts those sorts of games, so this change would not be that meaningful.
The proposed bill also redirects how unclaimed prize money is used, a change that Garland said would have little overall impact on annual revenue.