British firm to manage the Pennsylvania Lottery

Pennsylvania Lottery

January 11, 2013 2:16:29 PM PST
The British national lottery operator is poised to take over management of the $3.5 billion Pennsylvania Lottery after a top official in Gov. Tom Corbett's administration told employees Friday that it has awarded a contract to the company.

That puts Pennsylvania on track to become the third state, after Indiana and Illinois, to hire a private lottery manager.

"We're confident that by combining one of the nation's best lotteries with one of the best private-sector lottery industry experts in the world, we'll end up with a win-win proposition to grow and protect Lottery profits for decades to come," Secretary of Revenue Dan Meuser told employees in the email obtained by The Associated Press.

The Pennsylvania Lottery is one of the nation's largest.

Administration officials have maintained that Camelot's commitment of $34 billion in lottery profits over 20 years is a better deal than state employees could deliver as the state eyes growing demand for state services for the elderly that are underwritten by the lottery.

Meuser told employees that the contract has been formally awarded, but Camelot cannot begin work until the contract receives final reviews and signatures required for execution. That is expected to happen next week, he said.

Bringing the process to a successful conclusion is a key test on privatization for Corbett, who promised when he ran for governor that he would look to privatize state services. In addition, securing the contract gives Camelot its biggest footprint yet in the United States.

However, challenges await the Republican governor's agreement with Camelot Global Services.

The union representing state lottery employees is suing to block an agreement with Camelot and has filed a grievance and an unfair labor practice charge. The lawsuit challenges the governor's authority to privatize the lottery's management and expand the scope of lottery gambling that is contemplated by Camelot.

State Treasurer Rob McCord is warning that he may not approve payments to Camelot unless he's satisfied that its planned gambling expansion is authorized by state law.

Messages left for spokespeople for Corbett and Meuser were not immediately returned.