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WV Lottery revenues down from 2012, but finish above projected

CHARLESTON, W.Va. - The West Virginia Lottery Commission finished its 2013 fiscal year about $129 million behind its 2012 revenues, mostly because of competition from surrounding states, officials said.

But the Lottery still finished $190 million ahead of its own projections, however, as construction at an Ohio casino has not proceeded as fast as expected.

With all of its revenue sources combined, the Lottery brought in $1.33 billion in the 2013 fiscal year, which ended June 30. In 2012, the lottery brought in $1.45 billion.

The main cause of that decline was a significant drop in racetrack slot machine revenues, which went from $764 million in 2012 to $655 million in 2013.

The state had expected a much larger drop in racetrack video lottery revenues, however. Lottery officials projected they would be $525 million in 2013, a 31 percent drop from 2012 revenues.

"We looked at our competition and said, this is what we think the impact (will be)," Lottery Director John Musgrave said following a meeting on Thursday.

Musgrave said new casinos in Maryland, Ohio and Pennsylvania are taking customers away from West Virginia's racetracks and casinos in Charles Town and Wheeling.

But Musgrave said a casino near Youngstown, Ohio, has taken longer to complete than expected. That's why estimates for 2013 were so low, and why 2013's actual revenues far outpaced those projections.

Instant games, limited video lottery, table games and the Greenbrier Casino also saw revenue declines over the last fiscal year.

The state brought in $108 million in instant games, compared to $117 million in 2012, $399 million in limited video lottery machines, compared to $406 million last year, and $70 million in table games, compared to $78 million in 2012.

The lottery's only revenue increase was in online games, like Powerball and MegaMillions. Those games brought in $86.9 million in 2013, compared to $83.6 million in 2012.

Lottery officials said that increase was caused by a $1 increase in Powerball ticket prices, which went into effect in January 2012.

The change in price also has lead to an increase in Powerball jackpots, which help drive sales. The lottery game had a record $590 million jackpot in June, claimed by an 84-year-old Florida woman.

Also Thursday, board members decided to delay disciplinary action on a Logan County American Legion post where employees allegedly stole video lottery money, and used the cash to run tabs, cash checks and more.

"We believe they may have even staged a burglary," said Brian Abraham, attorney for American Legion Post 19.

The organization faces a $10,000 fine, $1,000 for each machine it owns.

Abraham said the people in question were only employees of the American Legion, not members. He said those employees have since been terminated, leadership of the post has been completely replaced, and the group is now considering legal action against the former employees.

"They've righted the ship," he said. "I think you would be punishing innocent people."

Abraham said a $10,000 fine would "destroy" the American Legion post, which only had $4,000 in its checking account when new commandant Larry Goff took over in May.

Lottery Commission chairman Ken Greear recommended the full $10,000 fine, saying the lottery's integrity was at stake.

Finance committee members ultimately decided to table the case until next months' meeting to gather facts.

Commission vice chairman Bill Clayton told American Legion members it was the first time the Lottery Commission has considered disciplinary action against a nonprofit group.

"We've never done this before," he said. "We definitely don't want to stick it to you." Contact writer Zack Harold at 304-348-7939 or zack.harold@dailymail.com. Follow him at www.twitter.com/ZackHarold.


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