Senate OKs debit cards for lottery tickets

SANTA FE – A plan to beef up New Mexico’s state-run lottery cleared the Senate on Wednesday, although critics of the measure warned it could end up stifling dollar amounts for a lottery-funded scholarship program.

Senators voted 25-16 to approve the legislation, which would allow debit cards – but not credit cards as originally proposed – to be used to purchase lottery tickets, starting in July. Such lottery ticket purchases could eventually be made at gas pumps.

The Senate-approved measure also would eliminate a 2007 requirement that at least 30 percent of lottery revenue be funneled into the lottery scholarship program, although it would stipulate that lottery funding amounts could not decrease from current levels.

Backers of the measure said the changes could lead to increased ticket sales, more marketing and larger prize amounts, which could in turn bolster the lottery scholarship fund.

“It if does work out, it’s only going to be for the benefit of the lottery,” said Senate Minority Whip Bill Payne, R-Albuquerque. “I think we certainly need to give it a try, because we’ve got nothing to lose at this point in the game.”

However, opponents described the legislation as risky, saying it could mean more money for New Mexico Lottery executives and less money for students.

“Our primary objective of the lottery should be to help our students attend college,” said Sen. Cisco McSorley, D-Albuquerque.

“This is playing a very risky game with that fund,” added Sen. Gerald Oriz y Pino, also an Albuquerque Democrat.

About $40 million in lottery revenue is projected to be funneled into the lottery scholarship program in the current fiscal year, a figure that is down from previous years. Roughly $43.7 million had gone toward scholarships in the 2013 budget year.

Sen. John Arthur Smith, D-Deming, the bill’s sponsor, said overall New Mexico lottery ticket sales have been slumping since 2008.

The lottery expansion proposal could lead to larger prizes for lottery winners and could, if successful, reduce pressure on the state general fund to help fund the scholarship program, he added.

The lottery scholarship, created in 1996, covers most tuition costs for recipients. It is currently available to any New Mexican who graduates from an in-state high school with a qualifying grade point average. Students who receive a New Mexico GED are also eligible.

With tuition levels rising and the demand for the lottery scholarships outpacing available money, lawmakers last year approved a temporary fix to keep scholarships from being cut. The fix called for stricter eligibility guidelines – most students at four-year universities now have to take at least 15 credits per semester to qualify – and a three-year infusion of state tax dollars.

Student government groups at the University of New Mexico, New Mexico Tech, New Mexico Highlands University and two community colleges have passed resolutions opposing the proposed changes, according to the Santa Fe-based Think New Mexico.

Think New Mexico pushed for the current requirement that 30 percent of lottery revenue go toward scholarships and is also opposing the bill.

The lottery legislation, Senate Bill 355, now advances to the House of Representatives.