The Lottery’s current-year savings target was $18.4 million, reflecting the Governor’s order for a reduction in projected agency spending. The Division is expected to achieve $9.7 million of this spending reduction target. Attainment of the remaining savings would have reduced funding to levels that would compromise the Division’s ability to generate funding for State education aid. They will continue, however, to work toward implementing additional savings actions to achieve a portion of their remaining target in a manner that does not compromise their core mission.
Major Savings Initiatives
The Lottery is implementing the following actions to achieve its savings target:
Instant Ticket Printing – The Lottery has developed more efficient methods of ordering Instant Cash tickets that allow us to achieve cost savings. The Division has raised our price points on games and adjusted order quantities and timing to receive quantity and reorder discounts. ($2.3 million)
Telecommunications – The Lottery has not increased the size of our retailer base as quickly as originally anticipated. This has allowed the Division to realize savings in our data transmission costs. ($1.5 million)
Mission Programs – The Lottery has analyzed and cancelled most of our Mission Programs. The Mission Programs, although important, did not directly provide additional revenue to education. ($2.9 million)
Outsourced Investigations – Through a competitive bid process and the reworking of requirements, the Lottery was able to save a substantial amount of money on outsourced investigations used mainly for Lottery licensure. ($1.5 million)
Video Gaming Security – The Lottery will be assigning the responsibility of maintaining the security/surveillance systems at the Video Gaming facilities to the operators of the facilities once the systems have been paid off in full. This will relieve the Lottery of the cost of equipment replacement and repair. Some of this savings will be realized in FY2008-09. ($0.5 million)
SEQRA Environmental Reviews – All future costs of paying for SEQRA environmental reviews at the Video Gaming facilities will now be borne by the operators of the Video Gaming facilities. ($0.5 million)
Video Gaming Marketing Analysis – The Lottery has scaled back some of the outsourced analysis of Video Gaming facilities’ marketing expenditures in an effort to reduce costs for the program. ($0.3 million)
Personal Services – By delaying the re-fill of vacancies, the Lottery has been able to save Personal Services and associated Fringe Benefit and Indirect costs. ($0.2 million)
The Lottery will continue to evaluate cost controls. More importantly, the Division will remain focused on driving sales, since sales growth is much more important in creating revenue for education than cost control, since the entire Lottery’s operation is less than 4 percent of sales.