Last Friday, the Corbett Administration issued a “notice of award” of a 20-year management contract for the Pennsylvania Lottery's $3.5-billion operation to the British-based firm Camelot Global Services, PA, LLC. The notice of award is not yet a binding contract commitment, but a first step in the privatizing process. The Administration now has less than a week to execute an agreement that will turn the management of the Pennsylvania Lottery over to the private company.
The Administration is currently under a lot of scrutiny by many members of the General Assembly, as well as the labor union representing lottery workers. Prior to a Senate Finance Committee hearing yesterday, there were lots of questions that remained unanswered including if the administration has the authority to expand gaming without legislative oversight, why there is only a single final bidder, which is not Pennsylvania or even American based, to run the operation, or how Camelot is able to guarantee its promise of producing $34.6 billion in profits over the next two decades?
The announcement on Friday was disheartening because it demonstrated a clear lack of transparency. Such an agreement should not have been signed prior to any public hearing or input from the General Assembly who are here to represent their constituents. Our government was set up so that checks and balances are in place so that such a drastic change in policy that affects one of our most vulnerable populations, along with our workforce, is done in a collaborative, deliberative manner.
A 20-year contract is a significant amount of time and older Pennsylvanians are slated to lose the most if this contract does not live up to what has been promised. About 75 percent of the Pennsylvania’s Department of Aging budget comes from lottery revenues including the property tax relief and rent rebate program, free and reduced fare transit, long-term living services, and low-cost prescription drugs through PACE/PACENET. With Pennsylvania having one of the most profitable lotteries in the nation, the contract with Camelot goes back to the theory if it’s not broken, why fix it?
I understand the Administration’s concern that the aging population of Pennsylvania will continue to grow in the coming years and our current lottery system may not be able to bring in the profits to keep up to the demands for the programs. However, a reasonable and respectable approach to this theory would have been to provide access to information throughout this contract process and allow for several public hearings to take place before the announcement.
With regard to the issue of gaming expansion through this deal, as Democratic Chair of the Senate’s Community, Economic and Recreational Development Committee, I believe that any expansion efforts such as internet gaming and keno must be done through legislation.
We owe it to our seniors, the workers and all taxpayers to do better moving forward and provide more transparency in government in the future.