BILL ANALYSIS                                                                                                                                                                                                    

                                                       Bill No:  SB  
                       Senator Roderick D. Wright, Chair
                           2013-2014 Regular Session
                                 Staff Analysis

          SB 817  Author:  Senate Governmental Organization Committee
          As Introduced:  March 14, 2013
          Hearing Date:  April 23, 2013
          Consultant:  Paul Donahue


                            State Lottery: Drawings

          Allows the California State Lottery to provide for  
          witnessing of out of state lottery drawings via live audio  
          or video.

           Existing law  , the California State Lottery Act of 1984, an  
          initiative measure, authorizes the California State Lottery  
          and provides for its operation and administration by the  
          California State Lottery Commission and the Director of the  
          California State Lottery, with certain limitations. 

           Existing law  requires that, except for computer automated  
          drawings, lottery drawings shall be witnessed by an  
          independent lottery contractor, and that any equipment used  
          in the drawings is inspected by the independent lottery  
          contractor and an employee of the lottery both before and  
          after the drawings.

           This bill  permits the independent lottery contractor to  
          witness drawings in person or via live audio and video  
          feed, and the equipment used in the drawings to be  
          inspected in person or via live audio and video feed by the  
          independent lottery contractor and an employee of the  
          Lottery both before and after the drawings.


          SB 817 (Senate G.O. Committee) continued                     
                                        Page 2

          The  State Lottery Act of 1984  provides that none of its  
          provisions may be changed except to further its purpose by  
          a bill passed by a 2/3 vote of each house of the  
          Legislature and signed by the Governor.  This bill  declares  
          that it furthers the purposes of the Act.

          The State Lottery Act currently requires Lottery employees  
          and independent contractors to personally witness each draw  
          and to inspect draw equipment both before and after each  

          In compliance with current law, the Lottery employs two  
          part-time intermittent employees and independent  
          contractors who witness and inspect out-of-state draws for  
          Mega Millions, a multi-state lottery game where draws are  
          conducted in Georgia two times a week. These employees are  
          Georgia residents. 

          The Lottery Commission recently approved California  
          entering a second multi-state game, Powerball, which  
          conducts draws two times per week in Florida. Strictly  
          speaking, the Lottery is therefore required to hire  
          additional employees and another independent contractor,  
          who reside in Florida, to witness draws and inspect  
          equipment in Florida. 

           Purpose of the bill  :  The State Lottery is sponsoring this  
          bill in an effort to operate more efficiently without  
          compromising security and integrity. According to the  
          sponsor, having the option to witness and inspect via live  
          audio and video feed, only, would serve the same purpose as  
          having Lottery representatives physically present at the  
          draws, but without the expense and unnecessary duplication  
          of efforts and repetitive reporting. 

          The State Lottery states that security measures and written  
          draw procedures for multi-state games have been fully  
          reviewed and vetted by the Lottery to ensure their  
          compliance with California's strict standards. In addition,  
          out-of-state draws are conducted by highly skilled and  
          professional employees of the state lottery where the draw  
          occurs, along with an independent contractor that oversees  
          draws and inspects all draw equipment.  The Lottery plans  
          to continue to have its own statistician analyze all  


          SB 817 (Senate G.O. Committee) continued                     
                                        Page 3

          pre-tests and draws to ensure that the numbers are selected  

          The State Lottery further states that this bill will put  
          California on par with other state lotteries' draw  
          procedures. It notes that, with the exception of California  
          and Texas, all the other 42 jurisdictions that participate  
          in Mega Millions and Powerball do not require the physical  
          presence of their own employees and independent contractors  
          at out-of-state draws.  

          The State Lottery believes that the bill would save the  
          state about $140,000 annually. 


          California State Lottery (source)


          None on file

           FISCAL COMMITTEE:   Senate Appropriations Committee