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Keno falls $43 million short of expectations

Just over a year ago, state officials unveiled the much-debated Keno video gambling in bars and restaurants around Ohio. Governor Ted Strickland's administration billed it as a way to bring in more than $70 million for Ohio schools. But revenue figures from the game's first year fell far short of expectations.

At the Hey Hey Bar and Grill in Columbus' German Village, owner Sue Gull walks through a game of Keno.

Keno is traditional gambling with a new twist -- customers pick from numbers one through 80 on a piece of paper, and a television screen displays the winning digits .

Gull has to demonstrate how it works because no one else in the bar is playing. She applied to become a Keno vendor last summer, right after the state legalized the game for bars and restaurants. She says Keno does OK, mainly on weekends, but she thinks the state had unrealistic expectations for the game.

"I think they thought that people were going to rush to the bars and play," Gull says.

Governor Ted Strickland billed Keno as a way to send extra money to schools without cutting other agencies. His office predicted $73 million in profits for the game's first year. Actual profits? $30 million.

Governor's spokeswoman Amanda Wurst admits the game underperformed in its first year. "But we are moving forward at the lottery with a new game that will also help to balance the upcoming fiscal year budget as we move forward in this very challenging economic time," Wurst says.

That new game, as Wurst calls it, rides on a controversial ballot initiative that would allow video slot machines at seven horseracing tracks around the state. Budget proposals from the Governor's office predict first-year revenues of $933 million.

Republican State Representative Jay Hottinger of Newark is skeptical.

"If they're wrong on these estimates like they've been in the past with Keno, that would result in the direct cut to public education," Hottinger says. "He's actually cut K through 12 education by that same amount, $933 million, so now he's making that up with what's anticipating in revenue coming in from the slots."

Strickland spokeswoman Amanda Wurst says the Governor stands by the proposal, and says the underperformance of Keno is is not an indicator of how well slot machines would do at racetracks.