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Lottery Slot Machines

Retailers get a pretty penny for the right to own and operate the state’s slot machines. The state lottery systems slot machines consistently bring in more money than the retailers need to turn a profit, yet the numbers remain high for their cut. Originally, they were getting 32% of the money that people pumped into the slot machines, but then people started complaining. So the state dropped their percentage to 28%, but the retailers will still making a killing on the slot machines. The state continued dropping the retailers cut of the slot machine profits, and now it is at 25% - which many think is still too high.

Even at 25%, the retailers are bringing in money hand over fist, and the players think that some of that money needs to be coming back to the patrons. Since the bar owners and retailers have been making so much money off of the slot machines, some say that it is a violation of state law. An Oregon Court of Appeals said that “any system that shortchanges schools and other vital services by paying retailers too generously flouts the law governing gambling.” Therefore, the slot machines are probably illegal under the current system.

The retailers contracts are up for renegotiation in 2010, so lottery commissioners would be wise to keep abreast of how their constituents feel about the slot machines. Since Oregon law states that they must pay retailers in a way that “maximizes the net revenue to the state," they are going to have to come up with another way to pay the retailers that doesn’t take all of Oregonians’ money.


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