Lottery director outlines central gaming system procurement, warns on offshore ‘sweepstakes’ and describes new games proposals

Thomas R. Burnside, the new Executive Director of the Office of Lottery and Gaming, briefed the Committee on Business and Economic Development on the agency’s FY26 budget, the planned replacement of its central gaming system, and regulatory priorities including online sweepstakes and proposed new card‑gaming and commercial bingo authorizations in local Budget Support Act subtitles.

Why it matters: OLG runs the District’s lottery, iLottery and oversees gaming regulation. Changes in its systems and regulatory roles affect retail operators, consumer protections, tax transfers to the general fund, and enforcement priorities.

OLG finances and staffing: Burnside said the mayor’s proposed FY26 OLG operating budget is approximately $272.4 million, down about $79.5 million (22.6%) from FY25’s $352 million; the variance largely reflects the consequences of the 2024 sports‑wagering law that moved operations and related revenue streams out of OLG’s enterprise flow and left the agency in a primarily regulatory role. The FY26 request includes funding for 98 FTEs, an increase of four positions to expand regulation and oversight for newly proposed commercial card gaming and bingo responsibilities. During questioning he said OLG had 11 current vacancies and that, because most OLG funds are enterprise rather than local funds, “there is no vacancy savings” line on the agency’s Schedule A.

Central gaming system procurement: Burnside described a planned competitive procurement to replace OLG’s central gaming system (CGS) and iLottery platform. He said the evaluation phase will take roughly six months after the response deadline, with an additional 4–5 months for negotiations and award (including Council approval where required), and that systems and services would be expected to go live no later than nine months from the award effective date. “This process will be intensive and involve everyone at OLG in some way. It will have a positive impact on all of our retailers and customers for years to come,” Burnside said.

Games of skill, card gaming and commercial bingo proposals: OLG officials testified they are prepared to implement policy changes the Council may adopt. The mayor’s proposed subtitles would (a) create a card‑gaming endorsement for hotels and arenas to authorize poker and blackjack tournaments, (b) create a commercial‑bingo endorsement for on‑premises venues (distinct from nonprofit charitable bingo), and (c) authorize expanded games‑of‑skill operations. Counsel Ridgeley Bennett warned of federal limits on some electronic devices: "The Johnson Act prohibits the interstate transportation of gambling devices," he told the committee, explaining that an early DC court opinion (Brazil) construes federal law to bar certain electronic gaming devices in the District and that the District lacks an opt‑out provision present in state statutes.

Age and jurisdictional conflicts: OLG and APCA staff noted potential conflicts in proposed age limits — some draft language would set the minimum player age at 18 while many APCA‑licensed establishments and neighboring jurisdictions set ingress requirements at 21. OLG said this conflict would be addressed in rulemaking and through coordination with APCA.

Online sweepstakes and enforcement: Committee members pressed Burnside and counsel about “online sweepstakes” operations — offshore firms that offer digital slot‑like and table‑game experiences tied to purchases of virtual currency and prize redemption. Burnside and OLG counsel said the agency is monitoring other states’ enforcement actions and would pursue cease‑and‑desist orders and other actions where operators require payment to play and thereby create an unregulated gambling product: "If you are requiring payment for an opportunity to win a prize that is gambling ... we would issue cease and desist letters and take other actions," Ridgeley Bennett said. Burnside said he had not yet coordinated with the Attorney General’s office specifically about recent multi‑state enforcement but welcomed such collaboration.

Sports wagering regulatory transition and CBE/CVE compliance: OLG confirmed the FY26 reduction in non‑personnel services reflects the contract and operations shift for sports wagering. The agency reported that DraftKings, Fanatics and Penn National hold temporary licenses and that work continues with the Department of Small and Local Business Development (DSLBD) on their CBE/CVE plans; OLG said it would follow up and report on permanent licensing and CBE compliance schedules. Committee members requested a check‑in on that process at the next DSLBD meeting.

Licensing and oversight workload: The agency said it has approved a small number of games‑of‑skill permanent applications in FY25 (3 approved to date in FY25, nine approved in 2024, with 24 applications filed in 2024), and asserted it can assume additional licensing responsibilities should the Council transfer authority from APCA. OLG requested four additional FTEs tied to the card‑gaming and commercial‑bingo subtitles (two for each program) but acknowledged revenue estimates for those new commercial activities are not yet available.

What happens next: OLG will provide additional written details at the committee’s request — specifically, vacancy savings amounts in enterprise funds, detail on sports‑wagering contract transitions, and further updates on online sweepstakes monitoring and multistate enforcement coordination.

Ending note: The testimony framed FY26 as a transition year in which OLG will shrink in revenue and operations due to statutory changes while expanding regulatory responsibilities and undertaking a major systems procurement intended to modernize lottery retail and digital services.