The new proposed type of game, called a Terminal Printed Instant Game, would resemble "instant games" sold in retailers across the state right now — commonly known as "scratch-off" tickets. The buyer uses a nickel to scratch a covering off the ticket and learn whether his dollar investment yielded a prize return.

The difference between that and a Terminal Printed Instant Game is that, with the latter, the win-or-lose result would come from a server on a terminal that prints the results out on lottery commission paper stock.

"We don’t think that an electronic instant lottery game is a traditional lottery game as the voters could have contemplated in 1991," said Rob Kohler, a consultant for the Christian Life Commission, which opposed the rule that would make the printed instant games possible.

Lottery Commission chairwoman Mary Ann Williamson, and commissioners J. Winston Krause and David Schenck, voted unanimously to post the rule changes for public comment. Staff recommended the hearing be held on Aug. 5 at 2 p.m., but it has not yet been posted.

With the new proposed game, a clerk at a licensed lottery retail terminal would print off, at a buyer’s request, a ticket showing the results of a pre-determined on-line game. (In this case "on-line" does not mean in the comfort of one’s own home. A clerk at a licensed lottery retailer has to be present to print off the ticket.)

A document determining winners and losers would be stored on servers provided by GTECH, the official software provider for the lottery commission, at licensed lottery retailers. The win-lose document contains a sequence of, for example, 5 million tickets that might contain 1 million wins of various payout amounts. They would be printed out in sequence. Ticket 1 would be a loser, ticket 2 a $5 winner, tickets 3 through 6 losers, ticket 7 a $100 winner, etc.

The new games could work as stand-alone games or as "add-on" games, product marketing manager Robert Tirloni told the commissioners. An example of an "add-on" game would be "Extra," which attaches a printed instant game to a lottery ticket printed out of the clerk-assisted on-line terminal. Besides the lottery numbers on the ticket, a set of individual "Extra" numbers would be printed below. If any individual "Extra" number matched any individual number on a lottery ticket, the purchaser could receive an immediate payout — $5, $500, or somewhere in between.

Tirloni told commissioners that the "immediate gratification" such games offer to players would provide a "new sales revenue source" and could also "increase the base game sales" when purchased as an add-on.

The first plans are to launch an add-on game for lotto tickets, Tirloni said.

In November 2005, the lottery commission wanted to make a comparable terminal printed instant game rule. The sent an opinion request on the constitutionality of such a rule to the Attorney General.

Suzii Paynter with the Christian Life Commission wrote Gov. Rick Perry in January 2006, stating her opposition to the proposed rule changes. The lottery commission later withdrew its AG request, and the issue disappeared. Until now.

Kohler July 8 requested that the agency commissioners, none of whom was serving four years ago, to ask again at the very least for an AG opinion, "because at the very least it is a slippery, slippery slope."

But this time, the agency commissioners declined to ask the Attorney General for an opinion on the proposed rule’s constitutionality.

Lottery commission assistant general counsel Pete Wassdorf told the commissioners that in his legal opinion the games would not meet the statutory requirement of a video lottery terminal (VLT) because, among other reasons, there is no random number generator at the point of sale.

Kohler sees similarities between the new proposed games and VLTs, which are prohibited under the state lottery act. "In a sense, instead of displaying it on a monitor, they’re printing it out in writing, they’re painting a picture of it," Kohler told LSR after the hearing. "Whether it’s electronic video or an electronic picture, I don’t know the difference between the two."

Kohler said at the hearing he knew of no VLTs in any state that did not have predetermined results, so the absence of a random number generator at the point of sale was not relevant.

Schenck said during the hearing that "this seems a lot closer to an instant random drawing, kind of a slot machine activity." But he deferred to Wassdorf’s legal opinion.

Wassdorf said, "The only similarity to a video lottery type situation is that this is purchased from an electronic machine."

This new type of game would be implemented by the commission through rulemaking similar to the existing rules for scratch-off tickets.

The rule would lay out parameters for new games and allow the executive director to approve them without having to hold public meetings. Under the proposed rulemaking, the executive director, according to a draft of the proposal distributed at the meeting, "may issue further directives for the conduct of terminal printed instant games as necessary to implement this rule." The terminal printed instant games could have "different names and game formats associated with the games," the draft proposal reads.

In other words, the executive director could approve new games without having to go through the rulemaking process for each one. That means no required public notice beforehand, and thus no opportunity for public input. Just like scratch-off games, the public would first see the games in the lottery commission’s registry after the games had already been approved.

"That’s not public input," Kohler said.

Tirloni told the panel that the new games would use security measures currently employed by the scratch-off games, but Schenck seemed to question whether that would suffice. He questioned how they could audit the game to ensure that all the winners received their appropriate winnings, and threw several scenarios at lottery commission staff and GTECH representatives which would indicate the new games’ vulnerability to cons.

"We would be relying extremely heavily, in a way we don’t have to with scratch-off tickets, on GTECH’s control over access to this computer," Schenck said.

Another concern of Schenck’s seemed to give staff members and GTECH representatives real pause. He observed that sometimes store clerks will pre-print lottery tickets to have them ready for purchasers who come in later. Not an illicit practice — unless there is a secondary "Extra"-type game that could be seen to have an immediate payout. Clerks could con customers, giving them losing tickets and pocketing all the winners, cashing them out when no one’s looking.

"That’s a concern that those [scratch-off] tickets don’t create," Schenck said.

"[The Christian Life Commission’s] concern is introducing predatory products to the folks of this state," Kohler told the commissioners, citing studies by the lottery commission itself showing that less affluent populaces tend to purchase lottery products.

"This doesn’t slow that down," Kohler said. "In fact … you’re putting a rocket on the bike and going into these same neighborhoods with a more aggressive product."

Kohler said that the Christian Life Commission would participate in the rulemaking process in the coming months.

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