Harrisburg – Dec. 30, 2013 – Gov. Tom Corbett’s decision to discontinue his attempt to privatize the state Lottery is good news for Pennsylvania taxpayers and it aligns with repeated Senate Democratic calls for him to drop the plan and stop wasting resources, Senate Democratic Leader Jay Costa said today.
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Costa (D-Allegheny) was reacting to the governor’s announcement that his administration would not continue seeking an agreement with Camelot Global, LLC to privately manage the lottery.
Senate Democrats have been highly critical of the bid and the Corbett administration in its handling of the contract and the multiple extensions. They have said that the governor’s support of lottery privatization was wasteful of both time and money.
Last year, the Corbett administration awarded a contract to privately manage the Pennsylvania Lottery to Camelot Global, LLC. Earlier this year, Attorney General Kathleen Kane rejected the contract, citing instances where the proposal ran afoul of state statutes and constitutional provisions. The state Auditor General recently reported that the Corbett administration had spent, or contracted to spend, at least $4.5 million on the effort.
Costa’s statement is as follows:
“Throughout the process, Senate Democrats have been critical of the contract and the arrangement that the Corbett administration had with Camelot. Pennsylvania has an outstanding lottery that is efficiently and effectively operated by Pennsylvanians.
“There is simply not a good rationale or a responsible argument that the Corbett administration could offer that would justify privatizing the lottery in the manner they proposed. The Camelot proposal was unpopular, unwieldy and costly. It created questions when we should have been exploring answers to how we can help fund senior programs.
“Since the plan was first detailed, Senate Democrats asked tough questions and raised significant issues because we believe that the programs funded by the lottery are too important to be jeopardized.
“There are alternatives that would increase revenues to support senior programs without taking risks. In fact, Senate Democrats just unveiled a plan that would generate more than $1 billion in savings and revenues, a portion of which could be used to bolster senior programs and services.
“The best public policy and what makes most sense for taxpayers, seniors and the Lottery was for the governor to drop his arrangement with Camelot.”
The lottery reported record sales of $3.69 billion last year.
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Harrisburg, February 14, 2013 – 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 and 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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Contact:
Stacey Witalec| Press Secretary
Senator Jay Costa and Senate Democratic Caucus
535 Main Capitol | Harrisburg, Pa 17120
Phone:(717)772-2368 | Cell:(717)877-2997
www.senatorcosta.com
Harrisburg, February 11, 2013 – State Sens. Jay Costa (D-Allegheny) and John Blake (D- Lackawanna/Luzerne/Monroe) said that instead of outsourcing the Pennsylvania Lottery’s operations to a U.K. company, Camelot Global Services, the governor should allow the Lottery to implement AFSCME’s recommendations to raise new revenue.
“Instead of privatizing the management of the Pennsylvania Lottery, the governor should instruct the Lottery to move on many of the recommendations made in the AFSCME report so that hundreds of millions in new revenue can be generated,” Costa, the Senate Democratic Leader, said. “If current Lottery employees were given the latitude that is called for in the PMA with Camelot, they would clearly equal or exceed the revenue projections of the proposed contractor.”
“Instead of privatizing lottery operations without the consultation of lawmakers, we should be using our current, dedicated and capable Pennsylvania employees to grow the Lottery and generate more revenue to aid our seniors,” Blake said.
Blake, who serves as the Democratic Chair of the Senate Finance Committee, said that it would make more sense to build on the strengths of a successful system and a successful Lottery workforce rather than turning the entire operation over to a private, for-profit enterprise.
“I see no reason why we need to privatize the Lottery using a foreign concern when we can implement many of the recommendations made in the AFSCME report to boost revenue,” Blake said. “The governor should reconsider the decision on outright privatization and instead build on our successful system by expanding its discretion and simply augmenting its operations with any needed outside marketing or managerial experience.”
The recommendations made by AFSCME were contained in a counterproposal that the union generated following the governor’s decision to privatize the Lottery using a Private Management Agreement (PMA). AFSCME indicated that it could generate $1.5 billion more in lottery profit.
A recent Franklin and Marshall survey indicated sixty-four percent of registered voters who were asked oppose privatization of the Pa Lottery.
“The AFSCME proposal contains recommendations that will boost revenue, institute more internal controls and provide for greater accountability. We need to give our Lottery and our workers a chance to create more revenue and expand before we send the management of our system overseas,” Costa said.
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