A gamble: Ducey eyes keno to help fund teacher pay

PHOENIX — Gov. Doug Ducey is hoping to fund part of his teacher pay package through a new form of gambling that may be illegal, is opposed by a key backer of the governor — and also could blow up the deal Arizona negotiated nearly two decades ago with Indian tribes.

Documents obtained by Capitol Media Services show the governor hopes to generate $15 million a year by convincing Arizonans to play “keno.’’ That is a game where individuals choose several numbers and wait to see how many of them match those generated by a computer.

The idea is to increase the amount of money people spend with the Arizona Lottery by creating a new game, one with more immediate financial rewards.

Setting up keno is just a small part of how Ducey thinks he can find an extra $270 million for this coming year — and more than $670 million three years from now — to finance his plan to increase base teacher pay by 19 percent above current levels. And Ducey has

promised to restore $371 million that is now being withheld from schools for certain capital purchases.

Much of the plan is based on the governor’s projections of strong economic growth and his belief an improving economy will cut costs for state health care and social programs. Ducey also plans to tap other funds and jettison some of both his own priorities as well as those of lawmakers.

But it is the keno issue that could prove most controversial.

The Arizona Lottery already operates a host of games like Powerball where gamblers choose numbers they hope will come up and

“scratcher’’ instant-win tickets.

Keno is similar to the lotto games — but with a twist: Multiple games per day, and potentially per hour.

Players pick a series of numbers between one and 80. What makes this different from a game like Powerball is that the drawings are held every four minutes.

But here’s the thing: Existing Arizona law already bans certain games from being conducted or displaying results more than once an hour.

Then there’s the separate question of those gaming compacts.

Attorney Stephen Hart, who was in charge of the

Lottery when those deals were being negotiated in 2002, said certain kinds of gaming are reserved for the tribes. That specifically includes electronic games.

Less clear, he said, is whether the state could operate keno, with virtually instantaneous games and winnings, without running afoul of the agreement with tribes.

Hart said some of that may have to do with how customers place their bets. He said using paper tickets, versus an interactive terminal, may fall within the exception of what kinds of games the state can operate.

“I want to see the legislation,’’ he said, legislation that Ducey’s office has not yet crafted.

Mike Liburdi, the governor’s chief counsel, said he believes there are sufficient exceptions in the tribal gaming compact to allow the kind of keno games his boss wants to operate. As to that once-an-hour limit on games and displaying results, Liburdi said he will have to study that further.

The governor could still have problems getting the plan enacted, even if the prohibition against games more than once an hour does not apply or can be altered, and even if the tribes do not contest the state operating keno games.

“Keno is predatory gambling,’’ said Cathi Herrod, president of the Center for Arizona Policy, who has been a key Ducey ally.

Herrod said what’s happened in other states is that keno tickets are sold in “family-type restaurants’’ and sports bars, making the idea of multiple-per-hour drawings particularly addictive.

“We don’t need keno in our state,’’ she said. And Herrod said she has “made our opposition known’’ to the governor.