Gambling with the lottery; Pennsylvania on course to privatize
On the issue of whether Camelot can actually keep its commitment, DeLuca noted that Camelot was rejected by Illinois officials when that state decided to privatize its lottery. Also, the company that ultimately won the right to manage that lottery fell $50 million short in the first year of operation, which led to a legal fight.
Officials of the Corbett administration say they have learned from the mistakes of Illinois and have written protections into the agreement with Camelot, which can be viewed at www.revenue.state.pa.us/portal/server.pt/community/lottery_private_manag....
A statement under the question and answer section on the Pennsylvania Department of Revenue website says that if Camelot falls short of the guaranteed level of revenue to the state, the state could draw on collateral of $150,000 put up by the company. Critics, however, say that with $1 billion currently being provided, $150,000 is rather paltry.
One of the reasons Camelot is able to project such healthy growth is that it will be able to expand gaming to include online games and games such as Keno. Frank Dermody, the Democratic leader of the House, echoed others when he said “there’s no reason to pay a private corporation to run those games when the current state employees could just as easily run them.”