Oregon's budget crisis has garnered unwelcome attention across the country with cartoons and editorials pointing out the state's inability to provide basic needs, like education and health care, for the state's most vulnerable citizens.

The Oregon legislature has an opportunity to help the Lottery Commission meet its mandate to maximize returns of video poker sales to the state while also raising dollars for crucial programs.

Senate Bill 279 would reduce commissions on video poker to bar and tavern owners, bringing the "take" more in line with what owners receive for Keno and other lottery games. The current proposal would raise more than $75 million per year--and since video poker contracts are up for renewal in June 2004, the new funds could help plug the hole in the 2003-05 budget.

Despite two studies in 1994, one by the Secretary of State and another by economist Joe Cortright, that suggest that the current commission rate is two to three times higher than what tavern owners need as an incentive to keep the games, video poker commissions average more than $75,000 per tavern--about 33 percent of total net sales.

"Nobody wants to kill geese that lay golden eggs, but the evidence here is these geese are obese, and they would lay more golden eggs if you simply put them on a diet," said Steve Novick, legislative coordinator for the Oregon Department of Education, in testimony before the Senate Rules Committee on Thursday.

While SB 279 has had a hearing in the evenly split Senate, its counterpart, HB 2510, died quietly in the Republican-controlled House. In 2000, Oregon Restaurant Association (ORA) PAC contributions to legislative candidates totaled $235,401, of which six percent ($14,545) went to Democrats and 94 percent ($220,956) went to Republicans. In 2002, ORA PAC spent at least $266,000* on legislative races, with a similar partisan split. In addition to donating to campaigns, the Restaurant Association spent almost a million dollars ($934,627) on lobbying activities during 2001 and 2002. (Figures for 2003 won't be available until January of next year since expenditures by lobbying employers are only disclosed annually, meaning that the data isn't available until months after the end of the legislative session.)

"Oregon faces a major budget crisis and it is disappointing that this proposal didn't even get a hearing in the House. I hope the will of a major political donor like the Oregon Restaurant Association (ORA) will not prevent making tough policy decisions." says Janice Thompson, executive director of the Money in Politics Research Action Project.

*This figure is based on an analysis of 95% of 2002 campaign contribution dollars.
###