The Texas Senate on Thursday unanimously passed a bill that would shut down the Texas Lottery Commission and transfer its duties to another state agency. The move comes after a string of controversies and would bring big changes to how the lottery is run — including new limits on how tickets can be bought.
Senate Bill 3070 would hand over lottery and charitable bingo operations to the Texas Department of Licensing and Regulation (TDLR). The bill would also require a review of the Texas Lottery in August 2027 by the Sunset Advisory Commission, focused solely on whether the lottery should continue to exist. If the commission doesn’t recommend continuing the lottery, it would be shut down later that year.
The bill was introduced by Republican Sen. Bob Hall of Edgewood, who has accused the state lottery commission of enabling money laundering and the sale of lotto tickets to underage customers.
“The problems we’ve had are not a result of some very smart people from outside the government figuring out how to beat the system,” Hall said on Thursday. “The criminal activities that have taken place came from within the lottery commission itself.”
Steve Helm, a spokesperson for the Texas Lottery Commission (TLC), told the Texas Newsroom on Friday that the agency "respects the legislative process," adding that it was prepared to fully cooperate to ensure "a smooth, seamless and successful transition" of lottery operations to the TDLR.
Other key provisions of SB 3070 include:
- Capping lottery ticket purchases at 100 tickets per transaction.
- Limiting retailers to five lottery ticket machines.
- Banning lottery employees and their family members from purchasing lotto tickets.
- Creating a Lottery Advisory Committee to provide external expertise to the TDLR.
- Requiring the TDLR to submit an annual report about lottery operations to ensure transparency.
SB 3070 now heads to the Texas House for consideration.
What’s going on with the Texas Lottery?
The controversy started after two major jackpot wins raised eyebrows: a $95 million payout earlier this year won through a bulk-purchase scheme led by a group that bought nearly every possible number combination in a matter of days. The other was an $83 million prize in April 2023 claimed through a lottery courier service, a third-party company that lets users buy lotto tickets online.
In February, Gov. Greg Abbott directed the Texas Rangers to investigate the two drawings; other state agencies followed suit. The TLC responded by banning couriers from operating in the state. And last month, Ryan Mindell, the commission's executive director, resigned. This came about two months after TLC Commissioner Clark Smith stepped down from his post.
Thus began months of debate in Austin, as lawmakers weighed the very future of the Texas Lottery — and whether the state should ban courier services altogether or tighten regulations instead.
Further action against courier services
While the TLC has already barred couriers from Texas, SB 3070 would go further. The bill would make it a criminal offense to operate or use a courier service for buying or delivering tickets, effectively codifying the ban into law and raising the stakes for violations.
Before the ban, couriers operated without oversight in Texas for several years and according to Sen. Bob Hall, the Texas Lottery Commission “consistently lied” about not having the authority to regulate the industry. Hall previously said the agency’s refusal to implement oversight measures represented “a private-public partnership, led by the state agency, to engage in a criminal conspiracy to defraud Texans.”
But the couriers have pushed back against these accusations, arguing that the companies have repeatedly asked to be regulated since they began operating in Texas. One of these companies is Lotto.com, which sued the state's lottery commission over the ban on couriers in late April.
"Regulated lottery couriers support integrity and support the operations and continued growth of the Texas Lottery," said Rob Porter, chief legal officer for the company.
According to the bill’s fiscal note, the state could lose about $52 million in revenue over the next two years, in part due to the elimination of courier-based ticket sales.
