Senate committee approves higher in-store lottery payout and redirects excess fees to scholarship fund

The Senate State Agencies & Governmental Affairs Committee approved two lottery-related measures that change how retailers cash winning tickets and how the lottery’s small regulatory fees are handled.

Sponsor Jimmy Keegan told the committee House Bill 18-58 would let large "super retailers" cash winning lottery tickets up to $4,999 in store, removing the current requirement that prizes above a much lower threshold be redeemed only in Little Rock. "If this super retailer wants to cash them, they could go up to $4,999," said Mike Helms, chief legal counsel for the lottery, confirming the federal withholding threshold that triggers additional reporting. Helms said once the amount exceeds that limit, withholding and W‑2 reporting obligations kick in.

In a separate measure the committee approved, sponsors proposed eliminating a $10 annual ‘fidelity’ fee paid by retailers and folding that function into the existing bond fee, while directing amounts above a $500,000 minimum in the bond/proceeds account to scholarship funds. Sponsors said the change was intended to reduce regulatory friction and direct modest administrative savings to scholarships; counsel said retailers’ costs would not increase under the proposal.

Committee members asked about retailer overdraft risk and whether reducing reporting burdens could create operational problems. Helms acknowledged previous retailer complaints about delayed reimbursements but said the lottery and retailers had worked to reduce those problems. Both bills were moved, seconded and approved by voice vote.

The committee recorded no roll-call on these measures; both passed by voice vote and will proceed as directed by the legislative process.