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Illegal sale of Pennsylvania lotto blocked by state attorney general

by Kyle Weidleman  |  February 25, 2013

Gov. Tom Corbett exceeded his constitutional authority by signing a deal with a foreign gaming firm to privatize the Pennsylvania Lottery, ruled state Attorney General Kathleen Kane recently. Kane also concluded that the deal clashed with the state lottery act, the gaming act and applicable case law while also violating the state constitution.

By shifting the management of the lotto to Camelot Global Services PA, LLC—a private, foreign firm—as many as 170 state lottery workers, many of whom are AFSCME members, would have been out of a job. The contract would have also expanded the state lotto into electronic gambling machines, like keno. Kane ruled that the authority to privatize and expand the state lottery rests with the legislature, not the governor.

Corbett has not yet ruled out a court challenge to overturn the attorney general's ruling. AFSCME International Vice President and Council 13 Executive Director Dave Fillman called on the governor's administration "to move on and get to the business of making one of the nation's best lotteries even better."

Before cutting a deal with the British firm, Corbett promised that his plan would bring in more than $130 million in additional income for programs for seniors each year, although the Pennsylvania lotto has one of the lowest administrative costs in the nation. With little to cut, Camelot would have to go after lottery employees' compensation and jobs while looking for additional revenue streams—like electronic games—that would go after more lower-income players.

Gov. Corbett has shown his hand—he is willing to do whatever is necessary to privatize state services. Although AFSCME members and Pennsylvanians of all stripes scored a victory with the attorney general's ruling, Corbett is ready to go all in to sell off the Keystone State's assets.

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