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Eastern Time (GMT-5:00) | Report: Ill. lottery manager short $100M on profit Illinois Lottery: Report: Ill. lottery manager short $100M on profit51 Rating:SPRINGFIELD, Ill. — The Illinois Lottery's private manager fell nearly $100 million short of the profits it promised to deliver for the state. But the Chicago Tribune reported Tuesday that revenues generated by Northstar Lottery Group still set an Illinois record. Illinois has fallen behind other state lotteries for years. Northstar promised $825 million in net revenue when it took over the lottery in July 2011. A Tribune analysis found it had collected $726 million by the end of June. That could mean hundreds of millions of dollars in penalties. The same month the company got the contract, it began seeking a reduction in what it promised. An arbitrator will decide the matter. Thanks to Coin Toss for the tip. AP We'd love to see your comments here! Register for a FREE membership — it takes just a few moments — and you'll be able to post comments here and on any of our forums. If you're already a member, you can Log In to post a comment. 12 comments. Last comment 9 months ago by . nc United States Member #99550 October 26, 2010 192 Posts Offline | | Posted: August 2, 2012, 10:22 am - IP Logged | |
Wonder if they will blame it on the increase in PB prices? Or will they be man enough to say, we inflated our projected profits to get your contract? | | |
PA United States Member #66644 October 16, 2008 1280 Posts Offline | | Posted: August 2, 2012, 10:31 am - IP Logged | |
OOOOOOOOOOOOOOOPS! dpoly1 - Playing the lottery to save the jobs of those that build, transport, sell & maintain luxury items! - Eschew Poverty ........... Vote Conservative! | | |
United States
Member #111467
May 25, 2011
6323 Posts
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| | Posted: August 2, 2012, 10:40 am - IP Logged | |
The Illinois Lottery's private manager fell nearly $100 million short of the profits it promised to deliver for the state. But the Chicago Tribune reported Tuesday that revenues generated by Northstar Lottery Group still set an Illinois record. Illinois has fallen behind other state lotteries for years. Northstar promised $825 million in net revenue when it took over the lottery in July 2011. A Tribune analysis found it had collected $726 million by the end of June. That could mean hundreds of millions of dollars in penalties. The same month the company got the contract, it began seeking a reduction in what it promised. An arbitrator will decide the matter. Thanks to Coin Toss for the tip. Still a great performance considering Illinois's lousy sales for many years.  | | |
Seattle, Washington United States Member #121168 January 3, 2012 78 Posts Offline | | Posted: August 2, 2012, 6:37 pm - IP Logged | |
I've been waiting to see if there's any blowback from Powerball upping their cost from $1 to $2; this may be the first sign of an issue. I know powerball's idea was "bigger initial jackpot, quicker to huge jackpots where more people play, more publicity, more money to states & vendors"; I'm thinking this might not be the case afterall... | | |
Ridge Runner - Oracle of the Appalachians Way back up in them dadgum hills, son! United States Member #74415 April 28, 2009 12416 Posts Online | | Posted: August 2, 2012, 7:11 pm - IP Logged | |
"The same month the company got the contract, it began seeking a reduction in what it promised." Now, that there is what you call one of them there "red flags". Now, right there somebody shoulda said: "Hold 'er Newt! She's headed fer the barn!" Dadgum straight, JimBob. I'll never forget old whats-his-name...
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Connecticut United States Member #62108 May 29, 2008 16622 Posts Offline | | Posted: August 2, 2012, 7:15 pm - IP Logged | |
Wonder if they will blame it on the increase in PB prices? Or will they be man enough to say, we inflated our projected profits to get your contract? 
"...Life is not a matter of holding good cards,but sometimes playing a poor hand well... 'Fortune Cookie wisdom' | | |
S.E.Iowa United States Member #120520 December 21, 2011 534 Posts Offline | | Posted: August 2, 2012, 8:44 pm - IP Logged | |
"The same month the company got the contract, it began seeking a reduction in what it promised." Now, that there is what you call one of them there "red flags". Now, right there somebody shoulda said: "Hold 'er Newt! She's headed fer the barn!" Dadgum straight, JimBob. They just didn't know who's palm to grease,in Illinois it could be any number of officials from the govenor on down.So they decided to inflate the numbers to get the contract and immediatly started to back pedal once the ink on the contract was dry.It should be interesting to see how this plays out. When I was a boy I was told that anybody could become President; I'm beginning to believe it. ~Clarence Darrow There ought to be one day - just one - when there is open season on senators. ~Will Rogers | | |
Clarksville United States Member #489 July 15, 2002 15855 Posts Offline | | Posted: August 3, 2012, 7:59 am - IP Logged | |
If they are short about 100 million, how can the possible penalties be hundreds of millions? Makes no sense to me. Posters are not forever... | | |
Zeta Reticuli Star System United States Member #30849 January 17, 2006 7990 Posts Offline | | Posted: August 4, 2012, 12:59 am - IP Logged | |
Not much they can do with the numbers games unless they reduce the payouts. I'm thinking maybe they are really going to get tight with the scratchers. Ironic kind of, Quinn (Gov.) insisted on letting Northstar run the lottery. Let's say the lottery itself was the jackpot, the state running it every year was the annuity, and Northstar was the 'cash option'. The players should always take the cash and the state should stick with the annuity! When all states allow winners to remain anonymous some clod will want a press conference. | | |
NY United States Member #24178 October 16, 2005 2535 Posts Offline | | Posted: August 5, 2012, 3:12 am - IP Logged | |
Wonder if they will blame it on the increase in PB prices? Or will they be man enough to say, we inflated our projected profits to get your contract? They can try to blame it on PB prices, but that's not going to be a very good strategy, since overall sales are up. There were 3 jackpots that weren't fully funded yet, but the actual loss of profit to Illinois was only a tiny fraction of the $100 million difference. That minor reduction in profit was probably offset by increased profit from the higher sales. The real question is the details of what they "promised", whether or not the state changed anything that affected the profit, and the details of the overall agreement. | | |
NY United States Member #24178 October 16, 2005 2535 Posts Offline | | Posted: August 5, 2012, 3:14 am - IP Logged | |
If they are short about 100 million, how can the possible penalties be hundreds of millions? Makes no sense to me. It's because they're paying penalties for not delivering what they promised, not just making good on the promises. The company agreed to those penalties, so they've got to make good on the penalties instead of just the profit they didn't generate. | | |
United States
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May 25, 2011
6323 Posts
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| | Posted: August 5, 2012, 3:10 pm - IP Logged | |
It's because they're paying penalties for not delivering what they promised, not just making good on the promises. The company agreed to those penalties, so they've got to make good on the penalties instead of just the profit they didn't generate.
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