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Panel delays vote on outsourcing Indiana lottery

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Indiana would retain control of its lottery even if it hires a private vendor to take over more of its operations, the Hoosier Lottery's executive director said Wednesday, noting that the state already outsources most of the business.

The State Lottery Commission postponed a vote on outsourcing most lottery operations to a private business that had been scheduled for Wednesday so members could have more time to digest proposals from two possible vendors behind closed doors. Chairman William Zielke said the vote would be taken Oct. 3. Officials expect to decide by Nov. 1 whether to sign a contract or leave lottery operations as they are.

Zielke said the commission had to "consider whether that's the right answer for us or not."

Rep. Pat Bauer, D-South Bend, who has been critical of Republican Gov. Mitch Daniels' privatization efforts, said any proposal would have to be carefully scrutinized to determine whether it was to the state's benefit.

"Whether or not it's a feasible deal, I think it has to be closely examined," he said in a phone interview. "The Toll Road looked like a good deal, but all the money we got for the Toll Road is gone, spent."

The state leased the Indiana Toll Road for 75 years to a private Spanish-Australian consortium for $3.8 billion in 2006. But that money, with the exception of a half-billion dollars socked away in a trust fund, has been either spent or committed to projects already. Daniels spokeswoman Jane Jankowski said Wednesday that highway revenues are expected to return to about the levels they were before the state received the lease payment.

If the lottery commissioners decide to proceed with outsourcing, they would choose between New York-based Scientific Games International and Rhode Island-based GTECH, both major lottery vendors. Two foreign firms dropped out of the bidding earlier this month.

GTECH already provides and maintains vending machines for the Hoosier Lottery. Scientific Games currently provides the central online lottery system, terminals and instant tickets for the Hoosier Lottery, and is the minority partner in Northstar Lottery Group — the company that won the Illinois lottery management contract.

Indiana officials announced in July that they would seek a 10-year contract for lottery marketing, sales and distribution services. But Executive Director Karl Browning said Wednesday that the proposals were for 15-year contracts that could be extended based on "extraordinary performance."

The vendor also could earn a $1 bonus for each dollar by which it exceeds a revenue threshold set by the state, but would have to pay the state dollar-for-dollar if it falls below that benchmark, he said. He did not say what that threshold was. He did say that the vendors believed they could increase the revenue returned to the state by as much as 20 percent, though they did not think that increase would be sustainable.

Private firms already handle 88 percent of lottery operations and the outsourcing proposal would increase that to 95 percent, Browning said. Indiana would retain full ownership and control of the lottery, he added.

"It doesn't seem that different from what we have today," said commission member Jennifer Alvey.

Browning said part of the increased revenue would come from a plan to "broaden the player base."

"We're not out to expand gambling," he said. "We just want to attract people who don't necessarily play today."

But asked after the public session how the state could attract more players without expanding gambling, Browning replied: "That depends on your definition of expanding gambling."

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  • Selloff
    It's a shame most Hoosiers have no call in how we allocate our resources. "Indy Jane" says our highway funding will be back to levels before the Toll Road lease. Now we get another 70 years of foreign ownership without benefit because Mitch Knew Best. Now his farewell gift is to give away the lottery before he leaves to further his orthodoxy that everything should be exploited by private corporations.
  • Unfair Gambling by the State of Indiana
    its a shame thats most of the people that play the lottery are on the lower end income scale. Whats even worst is the fact that we the players can't get a fair game from the lottery. My bet is that the fairest game that can be played with the Hoosier Lottery is the Power Ball. Reason being that that is the only game that you can actually see the balls being drawn as they do with the Illinois l=Lottery but here in Indiana you are playing against a computer. Thats where the real story is, poor people that are dreaming for some luck but probaly don't even know that the odds are stacked, against them by a computer.
  • Stop This Before We Put You In Jail
    "That depends on your definition of expanding gambling." What a completely stupid statement. Executive Director Karl Browning should be ashamed. I propose we fire the current Lottery Executive Director and replace him with someone smart enough to run the lottery and not give away future growth from internet gaming to political insiders at taxpayer expense.
  • Yep
    Reddog has it right. We could easily get cheaper legislators from India or China.
  • Why wire coverage?
    Could the IBJ not be bothered to send its own reporter? Very lazy to run wire.
  • Outsourcing
    I think we should outsource the state legislators....2 things would occur (1) term limits (ahhhh) (2) would not have to see hair pieces...sorry (2) more accountability.

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  1. Of what value is selling alcoholic beverages to State Fair patrons when there are many families with children attending. Is this the message we want to give children attending and participating in the Fair, another venue with alooholic consumption onsite. Is this to promote beer and wine production in the state which are great for the breweries and wineries, but where does this end up 10-15 years from now, lots more drinkers for the alcoholic contents. If these drinks are so important, why not remove the alcohol content and the flavor and drink itself similar to soft drinks would be the novelty, not the alcoholic content and its affects on the drinker. There is no social or material benefit from drinking alcoholic beverages, mostly people want to get slightly or highly drunk.

  2. I did;nt know anyone in Indiana could count- WHY did they NOT SAY just HOW this would be enforced? Because it WON;T! NOW- with that said- BIG BROTHER is ALIVE in this Article-why take any comment if it won't appease YOU PEOPLE- that's NOT American- with EVERYTHING you indicated is NOT said-I can see WHY it say's o Comments- YOU are COMMIES- BIG BROTHER and most likely- voted for Obama!

  3. In Europe there are schools for hairdressing but you don't get a license afterwards but you are required to assist in turkey and Italy its 7 years in japan it's 10 years England 2 so these people who assist know how to do hair their not just anybody and if your an owner and you hire someone with no experience then ur an idiot I've known stylist from different countries with no license but they are professional clean and safe they have no license but they have experience a license doesn't mean anything look at all the bad hairdressers in the world that have fried peoples hair okay but they have a license doesn't make them a professional at their job I think they should get rid of it because stateboard robs stylist and owners and they fine you for the dumbest f***ing things oh ur license isn't displayed 100$ oh ur wearing open toe shoes fine, oh there's ONE HAIR IN UR BRUSH that's a fine it's like really? So I think they need to go or ease up on their regulations because their too strict

  4. Exciting times in Carmel.

  5. Twenty years ago when we moved to Indy I was a stay at home mom and knew not very many people.WIBC was my family and friends for the most part. It was informative, civil, and humerous with Dave the KING. Terri, Jeff, Stever, Big Joe, Matt, Pat and Crumie. I loved them all, and they seemed to love each other. I didn't mind Greg Garrison, but I was not a Rush fan. NOW I can't stand Chicks and all their giggly opinions. Tony Katz is to abrasive that early in the morning(or really any time). I will tune in on Saturday morning for the usual fun and priceless information from Pat and Crumie, mornings it will be 90.1

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