Kansas Lottery

History

Article 15 of the Kansas Constitution was amended in 1986 to allow the operation of a government-run lottery. The Kansas Lottery Act was passed by the Kansas Legislature in 1987, and is contained in K.S.A. 74-8701 through K.S.A. 74-8732. The Lottery Act establishes the government-owned and operated Kansas Lottery, and sets parameters for organization and operation of the Lottery. The Lottery is established by KSA 74-8703, the Kansas Lottery Commission is created by KSA 74-8709, and the powers and duties of the Executive Director are outlined in KSA 74-8704 and KSA 74-8706. Distribution of all revenue from the Kansas Lottery is also directed by the Legislature pursuant to K.S.A. 79-4801 through K.S.A. 79-4806. In addition to the Act itself, individual game and promotion rules are set forth in temporary administrative regulations passed by the Kansas Lottery Commission at their meetings (usually monthly).

In 1987, ticket sales for the Kansas Lottery began in 21 cities. The first instant game was "Up and Away", with a grand prize drawing of $100,000. The first week's sales were $7 million. The Kansas Lottery gradually introduced games. The early success of the Lottery allowed it to create elaborate marketing campaigns, including a traveling singing group, the Kansas Lottery Singers. The group took popular songs, changing lyrics for Lottery commercials. They traveled around Kansas from June to September 1988. Also in the late 1980s, the Lottery constructed a building on the Hutchinson fairgrounds. This building was used as a studio for the game show Kansas Lottery Live. Winners were drawn from a giant tub filled with non-winning lottery tickets. The game show ran on WIBW-TV, and later by the KSN TV network. The game's original hosts were Fred Broski and Teri Messner. Messner eventually left the show, replaced by Robin Smith, who co-hosted until the show ended in 1990.

The Kansas Lottery continued to introduce instant-win games, including those with higher price points. In 1995, the Kansas Legislature approved and the governor signed the renewal of the Kansas Lottery until 2002.

By 2000 the Lottery had produced $500 million for Kansas. The Lottery re-entered the game show business in 2000 by participating in the Powerball Instant Millionaire series.

In 2007, the Kansas Legislature passed Senate Bill 66, extending the Lottery until 2022 and creating the Kansas Expanded Lottery Act authorizing the Lottery, on behalf of Kansas, to own and operate four destination casinos. Electronic gaming machines would also be allowed at three parimutuel racetracks.

SB 66, as amended, created the Kansas Expanded Lottery Act which authorizes the following:

The Kansas Lottery Commission is responsible for ownership and operational control of all provisions of the Act and is authorized to enter into contracts with the gaming managers for gaming at the exclusive and nonexclusive gaming zones.

On December 22, 2008, ground was broken for the Boot Hill Casino & Resort in Dodge City. Boot Hill is the first complex built under the 2007 Kansas Expanded Lottery Act authorizing one casino in each of four areas to generate revenue for Kansas. A private developer, Butler National Corporation, built the casino and manages it, but the Kansas Lottery owns the rights to the gambling and the gambling equipment. The groundbreaking ceremony was held for Hollywood Casino at Kansas Speedway on April 30, 2010, Kansas' second government-run casino.

The Kansas Lottery offers about 90 different games, including a Made in Kansas series where a Kansas-based company partnered with the Lottery to create a themed instant-win second chance drawing, a "Millionaire Holiday Raffle" (a $20 ticket where players have a 1-in-150,000 chance at the top prize), and "online" games, including Hot Lotto, Powerball, Mega Millions, Super Kansas Cash, and 2by2.

Boot Hill Casino, Dodge City

After the creation of the "gaming zones" in the SB 66 amendment to the Kansas Lottery Act, the first Kansas-owned casino opened in Dodge City in December 2009. Boot Hill Casino has approximately 580 slot machines, and 13 table games - including blackjack, craps, roulette, and poker. Phase 2 of construction was scheduled to be complete in December 2011. Phase 2 includes adding a hotel, day spa, two restaurants, lounges, and it approximately doubles the gaming floor.

Hollywood Casino, Kansas Speedway

On April 30, 2010, the groundbreaking ceremony took place at the site of the second Kansas-owned casino negotiated under the Expanded Lottery Act. Kansas Entertainment (composed of equal parts International Speedway Corp. and Penn National Gaming Inc.) developed the $386 million casino, set to open in 2012.

The Hollywood Casino has several phases planned, the first phase includes a 100,000-square-foot (9,300 m²) casino floor, 2,300 slot machines, 86 table games and a lounge and eating facilities. Later phases may include areas such as a spa and a convention center, almost doubling the original bid of $386 million.

The casino opened in February 2012 and is located the second turn of the Kansas Speedway track.

Distribution of funds

Since the Kansas Lottery's start-up in November 1987, through June 30, 2009, Lottery ticket sales have produced $1,121,022,843 in revenues transferred to the State of Kansas. The Lottery's Fiscal Year 2009, which ended June 30, 2009, produced $230.5 million in sales and $68.2 million transferred to the state.

The Kansas Lottery Act requires that a minimum of 45 percent of total sales be paid back to the players through the prize fund. In fiscal year 2009 (July 1, 2008 through June 30, 2009), the Kansas Lottery paid out 56 percent in prizes. The State Gaming Revenues Fund received 29 percent of ticket sales; cost of sales was 4 percent (which covers online vendor fees, telecommunications costs and instant ticket printing); 6 percent was paid to Lottery retailers for commissions and bonuses; and 5 percent covered administrative expenses (salaries, advertising, depreciation, professional services and other administrative expenses.) The State Gaming Revenues Fund (SGRF) is funded through monthly transfers from the Kansas Lottery. Transfers are then made from the Gaming Fund to funds dedicated to economic development initiatives, prison construction and maintenance projects, local juvenile detention facilities, problem gambling assistance, and the State General Fund.

Of the first $50 million, $80,000 is transferred to the Problem Gambling and Addictions Grant Fund. Of the remaining $49.92 million, 85 percent of the remainder transferred to the Economic Development Initiatives Fund, 10 percent to the Correctional Institutions Building Fund, and 5 percent to the Juvenile Detention Facilities Fund. Any receipts in excess of $50 million must be transferred to the State General Fund.

All net profits from Kansas Lottery Veterans Benefit scratch tickets are dedicated to veterans' and military programs. In fiscal year 2009, the Lottery transferred $1,628,958 to benefit veterans' programs and National Guard scholarships.

Gaming Revenues Fund – Fiscal Year 2009

Economic Development Initiatives Fund Fiscal Year 2010 Recommendations

The primary recipients of monies from the Economic Development Initiatives Fund (EDIF) in Fiscal Year 2010 (July 1, 2009 through June 30, 2010) will be the Kansas Department of Commerce, Kansas Technology Enterprise Corporation, Wichita State University Aviation Research and the Kansas Board of Regents.

Kansas Department of Commerce

Operating Grant: The operating grant from the EDIF supports Commerce's traditional programs, including Attraction Development Grants and the Kansas Industrial Training and Retraining programs.

Older Kansans Employment Program: This program is designed to provide older Kansans, 55 and over, with an employment placement service. The emphasis is on providing jobs in the private sector taking into account non-traditional patterns of employment.

Rural Opportunity Program: This program helps attract investment, business development and job growth in rural areas of the state. It provides additional funding for the Center for Entrepreneurship, Kansas Main Street and Capacity Building Grants.

KTEC Grant Programs: The Kansas Technology Enterprise Corporation (KTEC) provides research support, direct company investments and business assistance. KTEC's philosophy targets sustainable economic leadership through technological innovation and business acceleration.

Senior Community Service Employment Program: This program provides Kansans aged 55 and over with employment placement services with emphasis on employment in the private sector.

Kansas Commission on Disability Concerns: The KCDC provides policy recommendations to the State of Kansas on changes to laws, regulations and programs that affect people with disabilities. The KCDC also provides information and training to the public.

Strong Military Bases Program: This program supports ongoing efforts of the Governor's Military Council to prevent the closure or downsizing of the state's military bases.

Board of Regents

Vocational Education Capital Outlay: This program provides grant money to community colleges and technical schools and colleges, primarily to help purchase equipment. The program requires a 50 percent match from the institutions.

Technology Innovation & Internship: This grant program allows instructors from community colleges and technical schools and colleges to intern in private industry for short periods to expand their knowledge. The grant requires a one-to-one match. This program also provides funding for innovative equipment for students.

Kansas State University

Extension System and Agriculture Research Programs' Cooperative Extension Program: Kansas State uses this funding for a variety of operating expenses.

Wichita State University

National Institute for Aviation Research Grant: This funding will build on previous state initiatives and help ensure the continuation of a strong aviation infrastructure in the state. The funding will also assist in securing federal resources.

Aviation Classroom Training Equipment: The State is a partner with Wichita aviation companies, the City of Wichita and Sedgwick County in the development of the national Center for Aviation Training. The Center will enable thousands of Kansans to be trained for high-paying jobs in the aviation industry.

Pick 3

Pick 3 is played seven times a week. Prices, prizes, and options vary.

Keno

Keno is played seven days a week. Prices, prizes, and options vary. Keno is available at retailers with a Keno monitor. A computer randomly selects 20 numbers every 4 minutes. Drawings are from 5:00 AM to 1:52 AM daily.

Kansas Hold'Em

Kansas Hold'Em is a daily five-card poker game. Prices, prizes, and options vary. Kansas Hold'Em is available at retailers with a Kansas Hold'Em monitor. The game draws every 4 minutes from 5:06 AM until 1:54 AM seven days a week.

Super Kansas Cash

Super Kansas Cash is an enhanced version of the former Kansas Cash game. Super Kansas Cash offers players two game for $1, with a chance to win prizes including a jackpot that pays winners in lump sum. It uses a 5+1 matrix that draws 5 numbers 1-32 plus 1 number 1-25 from a second set (similar to Powerball, Hot Lotto, and Mega Millions). Super Kansas Cash is played on Mondays, Wednesdays, and Saturdays. The jackpots begin at $100,000.

2by2

2by2 is currently played in Kansas, Nebraska, and North Dakota; it is drawn daily. 2by2 draws two red numbers 1-26 and two white numbers 1-26. Games cost $1 each. There are eight ways to win. The top prize is $22,000; it is doubled if it is won on a Tuesday and the prize is from a seven-day ticket.

Hot Lotto

Hot Lotto is offered through 15 lotteries, including in Kansas and the District of Columbia. Hot Lotto began in 2002 with six lotteries; Kansas joined Hot Lotto in 2006. Hot Lotto is drawn Wednesday and Saturday nights. The game draws five "white balls" numbered 1 through 47, and an orange "Hot Ball", numbered 1 through 19. Hot Lotto's minimum jackpot is $1,000,000 (all-cash, and "taxes paid"), increasing by at least $50,000 if there is no top prize winner. Hot Lotto, whose basic game is $1 per play, has an optional $2 play, known as Sizzler (similar to Mega Millions' Megaplier and Powerball's Power Play); it triples non-jackpot prizes. (The $30,000 second prize becomes $90,000 if the Sizzler option was activated. The Sizzler option was introduced in 2008.)

Kansas had produced five Hot Lotto jackpot winners through the January 12, 2013 drawing.

Hot Lotto changed its format on May 12, 2013. The current version features a "taxes-paid", cash jackpot; the advertised amount is the net (after withholdings) that is paid to, or shared, by top-prize winners, rather than the gross. (The gross amount, as always in American lotteries, is for tax purposes.) Other changes included the addition of 8 "white ball" numbers from its original 39; the number of orange "Hot Balls" remained at 19.

Mega Millions

On January 31, 2010, Kansas joined Mega Millions. (In 2009, the Mega Millions consortium and MUSL reached an agreement to cross-sell Mega Millions and Powerball.) The current format for Mega Millions began in October 2013. It is drawn Tuesdays and Fridays.

Powerball

Since 1988, Kansas has been a member of MUSL. Powerball began in 1992. Its jackpots currently start at $40 million; it is drawn Wednesday and Saturday nights.