Keno faces big test at legislative hearing Wednesday

A typical keno game in New York: A video screen with the 20 numbers drawn from a field of 80.

New York Lottery

A typical keno game in New York: A video screen with the 20 numbers drawn from a field of 80.

Connecticut’s on-again-off-again flirtation with keno could get more serious Wednesday after lawmakers conduct a public hearing on the controversial, lottery-style electronic game.

And while keno’s fate may be wrapped with that of an equally controversial plan to open new gambling facilities in Connecticut, House Speaker J. Brendan Sharkey, D-Hamden, said keno might be crucial in its own right to support the state lottery.

“I think the Lottery is making a compelling case,” Sharkey told reporters Monday in the Legislative Office Building. “They believe they need it for their own survival.”

Wednesday’s hearing by the Finance, Revenue and Bonding Committee will be the legislature’s fourth public forum on keno since 2003 and its third since 2010. Still, given keno’s controversial nature, Sharkey said, it’s important to hold another hearing this year before any launch of the game is considered.

Officials at the Connecticut Lottery Corporation have said in recent years that offering keno at bars and restaurants in the state has tremendous growth potential, and could play an important role in the long-term fiscal health of the lottery system.

Corporation officials also expressed some concerns about that future last month when lawmakers conducted a hearing on the proposal of the Mohegan Sun casino and Foxwoods Resorts Casino — which want to open between one and three new gambling facilities in the state.

Although these would be designed to counter growing competition the casinos face from new facilities in neighboring states, lottery officials said an expanding casino industry — both in Connecticut and out-of-state — could weaken the lottery system.

That system is the single-largest source of gaming revenue in the state budget. Lottery corporation revenues are projected to top $310 million this fiscal year.

By comparison, Connecticut’s share of video slot revenues from the two casinos is projected at $268 million.

Rep. Jeffrey Berger, D-Waterbury, co-chair of the finance committee, is one of keno’s strongest proponents in the legislature. Berger said the lottery system has limited growth options and told The Mirror last month that any proposal to expand casino gambling should include the introduction of keno to help the lottery system remain competitive.

The legislature and Malloy enacted a statute two years ago that would have allowed keno to be offered in Connecticut bars and restaurants, but scrapped plans before they were implemented one year later amid fears of voter opposition heading into the 2014 state elections.

But since then, legislators have realized they are unlikely to close big budget deficits projected for each of the next two fiscal years — $1.3 billion in 2015-16 and $1.4 billion in 2016-17 — without additional resources.

While the legislature’s nonpartisan Office of Fiscal Analysis projected two years ago that legalizing Keno would yield about $27 million annually for the state’s coffers, the lottery corporation has said there is the long-term potential for greater receipts.

In Massachusetts — the home of the most successful lottery in the nation in terms of per capita sales — the $790 million wagered on keno two years ago was 17 percent of the lottery’s gross revenues of $4.7 billion.

Connecticut could not launch Keno without the approval of the Mohegan and Mashantucket Pequot tribes, which own the Mohegan Sun and Foxwoods Resorts casinos, respectively.

Under a 22-year-old compact that grants the state a share of the casinos’ video slot revenues, Connecticut grants the Indian tribes that run them exclusive right to offer casino games in the state, and both sides have acknowledged keno falls under this umbrella. But tribal leaders have said they are willing to negotiate with state officials on the addition of keno.

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