Pennsylvania strikes deal to privatize lottery; some lawmakers irked
HARRISBURG — The Corbett administration on Friday awarded a contract to a British-based firm to privatize the management of the state lottery for the next two decades, inviting a barrage of partisan criticism in the process.
The contract is slated to go to Camelot Global Services PA. Its parent company runs the United Kingdom's lottery.
The contract isn't final or signed, and some lawmakers and others could try to scuttle the deal.
“We think it is a slap in the face to the Legislature,” said Senate Minority Leader Jay Costa, D-Forest Hills.
Revenue Secretary Dan Meuser announced the “notice of award” for the 20-year deal in a news release on Friday evening, but he was unavailable for comment.
Camelot guaranteed it would earn $34 billion for the state over the course of the contract. Corbett wants to increase lottery revenue for the growing elderly population in the state, the only one in the nation that dedicates all proceeds to senior programs.
The lottery recorded $3.5 billion in sales for the year that ended June 30 and contributed more than $1 billion to programs providing low-cost prescription drugs and property tax and rent rebates.
“We know the state has placed enormous trust in giving us responsibility for its lottery, and we intend to work tirelessly to earn that trust,” said David La Torre, spokesman for Camelot.
“We are confident in our projections on growing responsibly the Pennsylvania Lottery over the next 20 years and guaranteeing the economic future for seniors programs.”
Negotiating the deal in large part when the Legislature was not in session and doing it before a Senate hearing on the plan scheduled for Monday “will cause considerable blowback in the General Assembly,” said G. Terry Madonna, a political analyst.
The timing of the late-afternoon announcement prompted Costa to call the award “extremely disappointing and disturbing.” He said it “really is appalling to me personally and many of my colleagues.”
“It shows real contempt, not just for the Legislature, but for the public,” said Sen. Rob Teplitz, D-Harrisburg.
Lawmakers acknowledged that the governor is legally entitled to enter into multimillion-dollar contracts.
Jay Pagni, a spokesman for Budget Secretary Charles Zogby, said the administration's goal is “quite the opposite” of what critics described.
Without the notice of award, the administration would have been prohibited from talking about details in the contract process with Camelot. Pagni said the administration wants to be able to answer lawmakers' questions at the hearing.
“Our goal is to be as complete and provide as much detail about this 10-month procurement as we can,” Pagni said. The lottery management privatization effort began in April.
There are legal issues, however. Camelot said it would boost revenues in part by putting keno terminals in restaurants, bars and taverns. Legislators, including some Republicans, contend an expansion of gambling cannot be done without legislative approval. Treasurer Rob McCord, a Democrat, has said he may decide not to pay Camelot if he determines keno needs such approval.
Meuser has said agency lawyers told him the department has the authority to start keno, which is similar to Pennsylvania's previous Super 7 game except that drawings occur throughout the day.
The union representing lottery workers is suing to block the deal. “It's just incredible that the governor would ignore the General Assembly and the thousands of Pennsylvanians we've heard from who understand that this is a bad deal for our seniors,” said Dave Fillman, executive director of AFSCME Council 13, which represents lottery employees.
House Democrats on Friday afternoon threatened legal and legislative action to block a deal if Corbett reached one before Monday's hearing.
State Sen. Matt Smith, D-Mt. Lebanon, and House Minority Leader Frank Dermody, D-Oakmont, said they want to put the proposal under a microscope when the Senate Finance Committee convenes.
Said Dermody, “We have the best, well-run lottery in the country. It set profit records last year. They have the lowest overhead in the country.”
He said he would introduce legislation to “take it back” if Corbett sealed the deal without a hearing.
Asked if he can round up Republican votes for such a measure, Dermody said, “I don't know, but there are Republicans against this, too.”
Brad Bumsted is state Capitol reporter for Trib Total Media. He can be reached at 717-787-1405 and email@example.com. Debra Erdley is a staff writer for Trib Total Media. She can be reached at 412-320-7996 or firstname.lastname@example.org.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Tire comes off, hits oncoming car, kills 1 on Route 28
- Clairton wins 11th WPIAL football championship
- Play of nose tackles could have impact on Steelers’ stretch run
- Plum man killed in Saltsburg Road rollover
- Pirates cut ties with Davis, clearing path for Alvarez to play first base
- 6 shot at Clairton speakeasy; police seek suspects
- WPIAL’s Top 10 football champions of all time
- Westmoreland County sheriff won’t alter staffing as cash runs out
- City Christmas tree lighting kicks off Light-Up Night festivities
- No prison time for Army Sgt. Barbera for phone threat against reporter’s wife
- Starkey: Pens move on with, without Dupuis