FY 2013 Annual Report Board of Directors
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FY 2013 Annual Report Board of Directors Mark Koson John Kubiak Amy Bailey Secretary (8/12 – 10/12) Secretary/Treasurer Secretary (10/12 – 7/13) Member (10/12 – 7/13) (7/13 – current) Assistant Secretary/Treasurer Vice Chair (7/13 – current) Albuquerque (7/13 – current) Albuquerque Certified Public Accountant Albuquerque Business & Professional Representative Board Member Since 7/13 Business & Professional Representative Board Member Since 5/12 Board Member Since 9/12 Salvatore Baragiola Claude Austin Paul Guerin, Ph.D. Member Member Member Albuquerque Clayton Albuquerque Law Enforcement Officer Business & Professional Representative Business & Professional Representative Board Member Since 10/12 Board Member Since 9/13 Board Member Since 8/13 New Mexico Lottery Mission Statement Maximize revenues for education by conducting a fair and honest lottery for the entertainment of the public. Record Revenues of $43.7 Million A Letter from the Board At a time when more college students In the past 17 years, the New than ever need financial aid, the Mexico Lottery has raised $572.5 New Mexico Lottery raised a record million for education and 90,083 $43.7 million for Legislative Lottery students have attended the state’s Scholarships in Fiscal Year 2013. public colleges and universities on Legislative Lottery Scholarships. Our sales goal for the year was More than 43,000 students have $135 million. Thanks to two already earned their college degrees. record-breaking Powerball® jackpots, Scratcher™ games that On behalf of our staff, players, offered more opportunities to win, retail partners, suppliers, vendors, and exciting promotions for both Gov. Susana Martinez, and Dan Salzwedel players and store clerks, our net legislators past and present, the New Treasurer (10/12 – 7/13) Chair (7/13 – current) sales came to $141.8 million. Mexico Lottery’s board of directors Sandia Park thanks you for your continued Business & Professional Representative With net sales up 6 percent support and encouragement. Board Member Since 8/12 from FY 2012, we were able Together, we’re bringing much to beat our revenue projection good fortune to New Mexico. by more than $3 million. Sincerely, At the same time, prizes were Dan Salzwedel $77.1 million. This includes three Chair, Board of Directors prizes of $1 million each and two prizes of $2 million each. Rosemarie Montoya and son Justin won $50,000 playing Scratchers™. Justin and his three siblings attended college on Legislative Lottery Scholarships. Rosemarie who lives in Las Vegas understands the importance of a good education. “I always encourage people to buy lottery tickets – always, always – so that other families’ children can have the opportunity our children had.” 1 Division Highlights Finance the Lottery to Disaster Recovery Negotiated and implemented 270+ Unqualified financial audit with no location – which allows the Lottery player promotions; participated adjusting entries or passed adjusting to replicate backup data across in 25 major community, entries and no financial findings locations, improving recovery educational and store events for the 18th consecutive year and reducing business risk Issued 40 news releases, Hired and trained a new Installed Google Analytics to generating more than 500 Accounting Specialist, processed monitor website traffic and on-message news stories approximately 1,560 checks and traffic sources and to understand Sales 157 bank wires for Accounts what content resonates with Payable, and reconciled visitors to nmlottery.com Conducted 25,898 retailer visits Processed 78,364 calls (10,960 approximately 120 General Completed design and software Ledger accounts each month development of retailer portal: inbound and 67,404 outbound) Processed 60,664 ticket orders Claims Center sold a winning • Internal and external web Roadrunner Cash™ ticket site requirements for 259,154 packs of tickets for a $112,002 jackpot; • Deployed web server within Increased Lottery visibility ran two promotions DMZ of network in the field by selling in and installing 728 pieces of signage Collected $88.6 million from • Retailer code development retailers; $1.485 million in NSFs; • Defined and developed (103% increase over FY 2012) $3,900 in NSF fee income. tables for data transfer from Issued Request for Proposals for Charged $6,500 to Bad Debts AS/400 to SQL Server Lottery Information Centers (LICs); procured 525 new LICs Purchaser attended a four-day Designed and modified back-end procurement conference; issued code for Hot Lotto® advertised to replace aging equipment five RFPs and one RFB which grand prize change to reflect the for retailers statewide resulted in four contracts after-tax amount. Five of the game’s Security & Enforcement eight non-grand prizes increased. Human Resources Security and Enforcement agents conducted or assisted Negotiated health insurance Marketing & Communications with 40 stolen ticket cases: premiums to a lower rate Issued Request for Proposals for • In 10 cases, agents worked with Negotiated dental premiums Professional Advertising Services retailer to combat internal thefts to a lower rate Introduced seven advertising • Five cases resulted in arrests Provided two management campaigns to promote new games training classes and New Mexico Lottery winners or warrants Performed 331 retailer inspections; Provided all-staff training sessions Wrote and designed publications to inform constituents of monitored stores for sales to Management Information Systems key Lottery activities: minors as a precaution Completed migration of all users • Four Retail Round-Up Conducted background to new network and infrastructure; newsletters investigations of 113 retailers implemented wireless access points • Four Legislative Newsletters and 54 prospective Lottery throughout the Lottery facility and vendor employees • 15 VIP Club e-newsletters enabling computer mobility for players Validated and authorized payment Upgraded network by installing • FY 2012 Annual Report for 376 prizes of more than $600; multiple bonded T1s connecting 27 prizes of more than $100,000 2 Record Revenues of $43.7 Million Organizational Divisions Board of Directors Security & Chief Executive Internal Enforcement Officer Auditor Marketing & Sales Communications Management Information Finance Systems Human Resources 3 Historical Review Net Revenues for Fiscal Year Gross Revenues** Public Education** FY 1996* $28.5 Million $6.3 Million FY 1997 $82.4 Million $21.9 Million FY 1998 $85.4 Million $20.1 Million FY 1999 $89.7 Million $19.6 Million FY 2000 $111.2 Million $24.5 Million FY 2001 $113.7 Million $25.9 Million FY 2002 $129.5 Million $29.6 Million FY 2003 $133.6 Million $33.1 Million FY 2004 $142.6 Million $35.9 Million FY 2005 $134.7 Million $32.2 Million FY 2006 $150.6 Million $36.9 Million FY 2007 $148.8 Million $34.8 Million FY 2008 $147.8 Million $40.8 Million FY 2009 $142.6 Million $40.8 Million FY 2010 $143.6 Million $43.6 Million FY 2011 $135.6 Million $41.3 Million FY 2012 $133.9 Million $41.3 Million FY 2013 $141.8 Million $43.7 Million Totals $2.195 Billion $572.5 Million Lottery Tuition Fund: $505,939,677 (1996 to present) Public School Capital Outlay Fund: $66,553,850 (1996 to 2001) Raised for public education through Fiscal Year 2013: $572,493,527 * Represents partial fiscal year of November 1995 - June 30, 1996 ** Rounded 4 Record Revenues of $43.7 Million Where the Money Goes $141.8 Million in Gross Revenues (numbers are rounded) 4.8% 30.8% %QUVQH2TQFWEV .QVVGT[6WKVKQP(WPF /KNNKQP /KNNKQP 54.3% 6.5% 3.6% 2TK\GU 4GVCKNGT%QOOKUUKQPU #FOKPKUVTCVKXG%QUVU /KNNKQP /KNNKQP /KNNKQP *Cost of Product includes: On-line vendor fees, advertising, ticket vendor fees, promotions, shipping and postage, responsible gaming, game membership and drawing game costs. By statute, the Lottery is required to return a minimum of 50% of proceeds to players in the form of prizes and 30% to the Lottery Tuition Fund. The remaining funds are allocated to cover the cost of product as well as retailer commissions and administrative costs. 5 High School Graduates and GED Recipients Have 90,083 Attended College on Legislative Lottery Scholarships Student Count By County Fall 1997 — Spring 2013 LLS Total Total Graduates County Students Awards So Far * "Other" includes New Mexico students Bernalillo 27,910 $ 190,491,963 13,841 who graduated from a Texas or Arizona high school under a reciprocal agreement with the Catron 118 $ 809,079 64 State Department of Education and Arizona Chaves 3,114 $ 12,525,313 1,513 residents on the Navajo Reservation who Cibola 1,049 $ 4,747,977 538 qualify for Legislative Lottery Scholarships Colfax 484 $ 2,839,724 227 ** "No Response" accounts for students that did not provide county information on Curry 2,236 $ 8,408,642 1,046 their admission forms; this information De Baca 135 $ 661,752 72 is requested, but not required Doña Ana 10,320 $ 61,858,359 5,097 • Source: New Mexico Higher Education Eddy 2,570 $ 11,440,183 1,261 Department (NMHED), (800) 279-9777 Grant 1,441 $ 8,076,529 779 www.hed.state.nm.us; table represents Legislative Lottery Scholarship (LLS) draws Guadalupe 219 $ 1,073,907 104 through Spring 2013 Harding 81 $ 413,748 54 • This report was prepared using the institution- Hidalgo 237 $ 1,385,667 114 supplied student and student financial aid files • These figures will always differ slightly Lea 1,862 $ 5,231,281 846 in different categories because of official Lincoln 900 $ 4,799,195 433 reconciliation adjustments