On Sunday evening, Texas Governor Greg Abbott signed into law a measure that will extend the operation of the Texas Lottery for another four years, while introducing new regulations to address controversies surrounding the state’s gaming activities. This development occurred after Texas lawmakers debated the possibility of completely abolishing the lottery.
During the recent legislative session, the Texas Lottery unexpectedly became a contentious issue as lawmakers primarily focused on other significant topics such as public school funding, property tax relief, and THC regulation. The lottery commission faced increased scrutiny due to two major controversies: a colossal $95 million Lotto Texas jackpot that was won by a single entity purchasing an overwhelming 99% of the possible ticket combinations, and the growth of online ticket sales via apps known as lottery couriers.
Lottery couriers function by selling tickets remotely. They print physical tickets for customers at their physical stores and then share digital copies of these tickets through apps. Some legislators argued that these services violated state legislation that prohibits sales “by telephone,” while the service providers claimed their actions were legal and endorsed by the lottery commission. This legal ambiguity was compounded by the lottery commission’s previous allowance of these services, followed by a sudden move to ban them during the middle of the legislative session.
Lieutenant Governor Dan Patrick and Senator Bob Hall made it a priority to ban couriers, resulting in Senate Bill 3070. Introduced after the regular filing deadline, the bill was given an exemption to progress. Effective immediately, the bill extends the lottery’s run until 2029 with more stringent regulations and abolishes the Texas Lottery Commission, transferring lottery management to the Texas Department of Licensing and Regulation (TDLR) starting September 1.
TDLR is coordinating a transition involving a three-person team and collaborating with both TDLR and former lottery commission staff to oversee operations. This legislative move came at a time when some long-time critics of the lottery viewed abolishing it as a potential outcome. However, concerns about replacing the annual $2 billion revenue earmarked for the public education fund deterred any moves to dismantle the lottery entirely.
“We discussed the possibility briefly,” noted Hall. “But ultimately realized we couldn’t end the lottery because it affects the already set budget. Thus, ensuring we balance the finances for the next biennium was essential.” Although Hall originally aimed to abolish the lottery, he described his bill as “the next best solution.” This legislation limits individuals to purchasing a maximum of 100 tickets in-person at authorized retailers and penalizes online or app-based sales as a class A misdemeanor with a potential year-long jail sentence.
This change aims to prevent scenarios like the earlier $95 million win through strategic ticket buying. The lottery’s future is poised for reconsideration in 2029 when another legislative decision is due following a review by the Sunset Advisory Commission. Despite new measures in place, Hall and other advocates for abolition remain skeptical about the lottery’s long-term viability. “Ending the lottery remains preferable for numerous reasons,” Hall stated. “Gambling doesn’t align with my vision of government’s role,” he added.
While questions remain on how TDLR will manage the lottery, and with whom, many top figures from the existing lottery commission have already exited. Former executive director Ryan Mindell stepped down in April, with the departures of two other commissioners occurring in February and May. Nonetheless, ongoing investigations by Texas Rangers, part of the Department of Public Safety, continue to delve into two significant jackpot events and courier practices, including the noteworthy $95 million win.
The commission faces additional challenges, including a lawsuit from a recent $83.5 million jackpot winner who hasn’t received her winnings. Kristen Moriarty, who discovered her good fortune in February via the Jackpocket app, is still awaiting her payout. According to the commission, the Rangers’ investigation delays her payment, but Moriarty indicated that no official inquiry from public safety has reached her. “My initial excitement is now overshadowed by stress and frustration,” she admitted.
The Department of Public Safety declined to comment on Moriarty’s situation, citing the ongoing nature of the investigations. The Texas Lottery, after this controversial session, finds itself navigating through legal and operational changes alongside unresolved disputes.