Senate Bill S5108

                                 BILL NUMBER:  S5108

 TITLE OF BILL :

An act to amend the tax law, in relation to increasing the commission
paid to lottery sales agents

 PURPOSE OR GENERAL IDEA OF BILL :

This bill would increase the New York Lottery agent commission rate to
8%.

 SUMMARY OF SPECIFIC PROVISIONS :

Section 1 amends Paragraph 9 of subdivision a of section 1604 of the
tax law to govern limitations the division may place on compensation
necessary to assure adequate availability of lottery tickets.

Section 2 amends Section 1604 of the tax law to require the division
to set a compensation rate of eight percent for each ticket sold to a
licensed agent.

 JUSTIFICATION :

Lottery "agents" consist of neighborhood delis, bodegas, taverns,
convenience stores, pharmacies, gas stations, restaurants, grocers,
              

newsstands, bowling alleys, truck stops, stationary stores, beverage
centers, and liquor stores. Many of these are family-run enterprises.

When the New York Lottery was created fifty years ago, the division
decided that stores selling tickets would receive a commission. The
commission rate was set at six percent, meaning that agents make six
cents on a one-dollar scratch ticket. Today, the commission rate on a
one-dollar scratch ticket remains at six percent.

Since the creation of the New York Lottery, however, the state minimum
wage has increased 547% and will continue to climb over the next four
years. Lottery agents' energy, property, and payroll taxes have since
increased, along with the costs of insurance, regulatory compliance,
waste disposal, and other operating expenses.

Additionally, exposure to loss from theft increased when the New York
Lottery expanded the number of instant games and introduced $5, $10,
$20, and $30 dollar tickets.

New York also joined the multi-state Mega Millions and Powerball
online games, whose occasional big jackpots build foot traffic but
also create longer lines that deter non-lottery customers unwilling to
wait for gas, coffee, food, or the newspaper.

Increasing the lottery agent commission to eight percent will help the
17,700 small businesses who have been and continue to be harmed by the
aforementioned costs.

 PRIOR LEGISLATIVE HISTORY :

New bill.

 FISCAL IMPLICATIONS :

None to the state.

 EFFECTIVE DATE :
This act shall take effect immediately.