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Thursday, February 14, 2013

AG Rejects Lottery Management Plan

Harrisburg – State Senate Democrats applauded Pennsylvania Attorney General Kathleen Kane’s decision to reject the Corbett Administration’s plan to privatize the management of the Pennsylvania Lottery to a U.K.-based company Camelot Global Services. “The Attorney General made a proper decision,” Sen. Jay Costa (D-Allegheny) said. “Pennsylvania seniors all Pennsylvania residents can rest easy now that the Attorney General took this action and put a stop to the expansion of gaming without proper authorization.”

“The entire plan was flawed.” Costa, the Democratic Leader said. “It is clear that there are ways for current employees of the Lottery to be given the latitude to implement changes that will produce better results and even more money being generated.”

At a news conference today in Harrisburg, Kane said that she could not approve the deal negotiated between the Corbett Administration and Camelot. The Attorney General cited several reasons for her denial including that the arrangement infringed on the legislative powers of the General Assembly, that the plan was an illegal expansion of gaming without proper authorization and that the plan involved a waiver of sovereign immunity.

State Sen. Vincent Hughes (D-Philadelphia/Montgomery) who serves as Democratic Chair of the Senate Appropriations Committee said that Kane took the correct course in refusing to approve the Private Management Agreement (PMA.)

“We do not need a foreign-based company managing the operations of the Lottery when we have Pennsylvania residents with the ability to produce more dollars to bolster senior programs.” Senate Democratic Appropriations Chair Sen. Vincent Hughes said.

“The AFSCME study indicated that there were many pathways available for Pennsylvania officials to take to generate new dollars without privatizing the Lottery,” Hughes said. “There are tools available for the legislature to give to the Lottery that will produce a better deal. Plus, we can be transparent with our action and deliberation.”

The recommendations made by AFSCME were contained in a counterproposal that the union generated following the governor’s decision to privatize the Lottery. AFSCME indicated in its presentation that it could generate $1.5 billion more in lottery profit.

“We can do a better job and do it in an open process involving the current Lottery personnel,” Sen. Anthony Williams (D-Philadelphia/Delaware), the Senate Democratic Whip said. “The Attorney General was clear that the General Assembly needs to be involved and that arbitrary action cannot be taken by the administration.

“There is no reason why we cannot open the process and allow the Lottery to suggest ways it can generate even more profits.”

State Sen. John Blake (D-Lackawanna/Luzerne/Monroe), the Democratic Chair of the Senate Finance Committee, said that there were so many questions about the privatization scheme that went unanswered and that the whole process needs to be restarted at the beginning and include the General Assembly.

“From the time the PMA was announced there has been great unease about the process and the procedures that were included in the deal,” Blake said. “I am pleased that Attorney General Kane put a roadblock up today and announced her decision to deny the PMA.

“Now members of the General Assembly can look at ways on building on the strengths of the successful Lottery that we now operate to generate more funds for seniors, using employees of the Lottery who are Pennsylvania residents.”

Costa said that he especially appreciated the fact that Attorney General Kane removed politics from the decision, focused on the legal issues involved in the contract and made the right call on behalf of Pennsylvania’s seniors.

Hughes said that there is no question that lawmakers will be able to generate the $50 million that was part of the agreement and that was included in the governor’s budget presentation.

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Corbett can challenge Kane's decision in court.

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