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With Northstar terminated, what will the Illinois Lottery do now?

Illinois LotteryIllinois Lottery: With Northstar terminated, what will the Illinois Lottery do now?
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So what's next for the Illinois Lottery?

That's the big question looming in the wake of Illinois Gov. Pat Quinn's politically-expedient move late last week to fire Northstar Lottery Group. Quinn made history late in 2010 when he inked a 10-year contract with Northstar to become the first-ever private manager of any state lottery in the nation. Two other states now have private lottery managers — Indiana and New Jersey.

Quinn's move last week to terminate Northstar may prove too little too late in terms of helping him get re-elected Governor in November. But at least his action fully acknowledges that Northstar has been chronically underperforming ever since it won the Lottery management contract nearly four years ago.

Call it a tactical blunder on Northstar's part. But with each passing year, it became increasingly clear that Northstar had grossly overstated the revenue it could generate as private manager when it competed against two other 2010 finalists — Camelot and Intralot — for the Lottery contract.

But what Quinn hasn't yet acknowledged — though it was clear to many observers four years ago — was that the whole process by which the state of Illinois selected Northstar in the first place was riddled with highly questionable moves, as the Auditor General of Illinois subsequently addressed in a damning report his office issued in June of 2011.

Of course, in a response to the Auditor General's report, the Illinois Department of Revenue, which oversaw the Lottery at the time, tried to defend how it handled the private manager selection. But the Auditor General didn't buy into most of what was offered as a rebuttal.

So with Quinn's apparent blessing, Northstar stayed in place until the Governor's hand was forced last week.

Now it will be up to Illinois Lottery Director Michael Jones and Quinn to decide what happens next, as the Lottery now operates as a state entity independent of the Department of Revenue.

What's most likely to happen is that Northstar will cease almost immediately to have any say in how the Lottery operates. Though there will likely be a short period of de-entangling transition, the 140 staffers or so staffers believed to work for Northstar will no longer be actively — or majorly — involved in charting the Lottery's course.

In the short term, Jone's own Lottery staff likely will take over management. And yes, there most likely will be a new private manager, as the Illinois state law that created a Lottery private manager function is still on the books and isn't likely to be done away with anytime soon.

Jones then will likely be in charge of overseeing a new RFP to solicit interest in becoming the second-ever private manager of the Illinois Lottery. Don't be surprised if some of those former candidates for the job, including former finalists Camelot and Intralot, throw their hats back in the ring.

But keep in mind that Jones, as has been well documented, comes at running the Lottery from the perspective of a marketer.

When Jones took the job of director of the Illinois Lottery (for the second time) in the fall of 2011, he made it clear he saw the job as a marketing challenge: Upgrade the Lottery's tattered brand image and new Lottery game players would be drawn in, thereby creating new revenue for the state.

So the new RFP for the private manager is likely to emphasize that entities with an expertise in consumer-oriented brand marketing should consider responding. That could open the door to a much broader — and potentially quite interesting — pool of candidates for the Lottery private manager post than was the case the first time around.

As for the two ad agencies that now handle Illinois Lottery advertising — Downtown Partners Chicago and Commonground Chicago — they aren't likely to be dismissed anytime soon so long as Jones is calling the shots.

Though Northstar Lottery Group barred Jones (per terms of its contract) from any contact with the two ad shops for the past 18 months, Jones is known to greatly respect the advertising both agencies created in the early going in his second tenure as head of the Illinois Lottery.

Still, it can't be said with absolute certainty that the Lottery's relationship with either shop will remain for the long haul, as much obviously is in a great deal of flux at the moment.

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15 comments. Last comment 1 month ago by Scratch$.
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Coin Toss's avatar - shape barbed.jpg
Zeta Reticuli Star System
United States
Member #30470
January 17, 2006
9107 Posts
Online
Posted: August 24, 2014, 12:38 am - IP Logged

Who knows what's next, just hope it isn't another Northstar.

I'm not sure if this really would help Quinn to get re-elcted, or that he needs it to get re-elected.

Bang Head

Those who run the lotteries love it when players look for consistency in something that's designed not to have any.

Lep

There is one and only one 'proven' system, and that is to book the action. No matter the game, let the players pick their own losers.

    Tialuvslotto's avatar - Jailin
    Texas
    United States
    Member #150804
    December 31, 2013
    206 Posts
    Offline
    Posted: August 24, 2014, 7:21 am - IP Logged

    "But what Quinn hasn't yet acknowledged — though it was clear to many observers four years ago — was that the whole process by which the state of Illinois selected Northstar in the first place was riddled with highly questionable moves, as the Auditor General of Illinois subsequently addressed in a damning report his office issued in June of 2011."

    Wow!  Corruption in Illinois???  Whoda thunk it? Green laugh

    If you can track it you can trap it!  Hippy

      Romancandle's avatar - moon
      IL
      United States
      Member #136311
      December 8, 2012
      234 Posts
      Offline
      Posted: August 24, 2014, 12:16 pm - IP Logged

      Hopefully add more transparency on the business side of operations for the players.

      That would be a good start... but then again, this is IL

      LOL

      -RC

        TnTicketlosers's avatar - Lottery-065.jpg

        United States
        Member #71120
        February 19, 2009
        990 Posts
        Offline
        Posted: August 24, 2014, 12:46 pm - IP Logged

        Isnt Tennessee more corrupted that Illinois,I think Tennessee rank in the 4 spot for the year....Pretty bad....

          alsports2000's avatar - 23606770150900
          Pharr, Texas
          United States
          Member #107
          August 23, 2001
          397 Posts
          Offline
          Posted: August 24, 2014, 5:33 pm - IP Logged

          So what's next for the Illinois Lottery?

          That's the big question looming in the wake of Illinois Gov. Pat Quinn's politically-expedient move late last week to fire Northstar Lottery Group. Quinn made history late in 2010 when he inked a 10-year contract with Northstar to become the first-ever private manager of any state lottery in the nation. Two other states now have private lottery managers — Indiana and New Jersey.

          Quinn's move last week to terminate Northstar may prove too little too late in terms of helping him get re-elected Governor in November. But at least his action fully acknowledges that Northstar has been chronically underperforming ever since it won the Lottery management contract nearly four years ago.

          Call it a tactical blunder on Northstar's part. But with each passing year, it became increasingly clear that Northstar had grossly overstated the revenue it could generate as private manager when it competed against two other 2010 finalists — Camelot and Intralot — for the Lottery contract.

          But what Quinn hasn't yet acknowledged — though it was clear to many observers four years ago — was that the whole process by which the state of Illinois selected Northstar in the first place was riddled with highly questionable moves, as the Auditor General of Illinois subsequently addressed in a damning report his office issued in June of 2011.

          Of course, in a response to the Auditor General's report, the Illinois Department of Revenue, which oversaw the Lottery at the time, tried to defend how it handled the private manager selection. But the Auditor General didn't buy into most of what was offered as a rebuttal.

          So with Quinn's apparent blessing, Northstar stayed in place until the Governor's hand was forced last week.

          Now it will be up to Illinois Lottery Director Michael Jones and Quinn to decide what happens next, as the Lottery now operates as a state entity independent of the Department of Revenue.

          What's most likely to happen is that Northstar will cease almost immediately to have any say in how the Lottery operates. Though there will likely be a short period of de-entangling transition, the 140 staffers or so staffers believed to work for Northstar will no longer be actively — or majorly — involved in charting the Lottery's course.

          In the short term, Jone's own Lottery staff likely will take over management. And yes, there most likely will be a new private manager, as the Illinois state law that created a Lottery private manager function is still on the books and isn't likely to be done away with anytime soon.

          Jones then will likely be in charge of overseeing a new RFP to solicit interest in becoming the second-ever private manager of the Illinois Lottery. Don't be surprised if some of those former candidates for the job, including former finalists Camelot and Intralot, throw their hats back in the ring.

          But keep in mind that Jones, as has been well documented, comes at running the Lottery from the perspective of a marketer.

          When Jones took the job of director of the Illinois Lottery (for the second time) in the fall of 2011, he made it clear he saw the job as a marketing challenge: Upgrade the Lottery's tattered brand image and new Lottery game players would be drawn in, thereby creating new revenue for the state.

          So the new RFP for the private manager is likely to emphasize that entities with an expertise in consumer-oriented brand marketing should consider responding. That could open the door to a much broader — and potentially quite interesting — pool of candidates for the Lottery private manager post than was the case the first time around.

          As for the two ad agencies that now handle Illinois Lottery advertising — Downtown Partners Chicago and Commonground Chicago — they aren't likely to be dismissed anytime soon so long as Jones is calling the shots.

          Though Northstar Lottery Group barred Jones (per terms of its contract) from any contact with the two ad shops for the past 18 months, Jones is known to greatly respect the advertising both agencies created in the early going in his second tenure as head of the Illinois Lottery.

          Still, it can't be said with absolute certainty that the Lottery's relationship with either shop will remain for the long haul, as much obviously is in a great deal of flux at the moment.

          Texas should do the same and fire whoever is responsible for "out of state " lotto winners. Texas is notorious for NOT producing more millionaires due to other states selling winning lottery tickets.....Rant

            Gleno's avatar - Lottery-001.jpg
            New Jersey
            United States
            Member #80354
            September 25, 2009
            289 Posts
            Offline
            Posted: August 27, 2014, 10:39 am - IP Logged

            Todd 

            Thanks for the lottery news and keeping us up to date.

              HaveABall's avatar - rocket

              United States
              Member #72448
              March 18, 2009
              984 Posts
              Offline
              Posted: August 27, 2014, 5:32 pm - IP Logged

              Hello, TnTicketlosers, depends on what benchmarks you have chosen.  For example, a few Illinois Governors have received/served fairly long prison sentences these past few decades.  However, several additional Congressors, Senators, Governors, and Mayors should have been impeached and imprisoned serving decade long terms and returning multiple millions of dollars swindled from ever decreasing amount of State Self Service and Income Tax payers. 

              This is why "Chicago Metro Area" is referred to as "the windy city" ... politicians with windy/unintelligible and unhelpful speeches/thoughts.

              Having millions of dollars in my financial accounts means more, consistent fun for me.Lovies

                Avatar
                New Member
                warrenville,illinois
                United States
                Member #55739
                October 17, 2007
                9 Posts
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                Posted: August 31, 2014, 9:15 am - IP Logged

                It is about time that they fired Northstar. We have way too many games and way too many scratchoffs that do not seem to be paying out all that much. Maybe we will get back to basics and drop some of the gimmick games.

                  uprrman's avatar - nw bookeep.jpg
                  harvard,il
                  United States
                  Member #96758
                  September 4, 2010
                  1271 Posts
                  Offline
                  Posted: August 31, 2014, 4:17 pm - IP Logged

                  i hope they get rid of my3 but keep the fire ball in. much better odds to win with fireballLurking

                  i want to be a millionaire a second time!

                    Coin Toss's avatar - shape barbed.jpg
                    Zeta Reticuli Star System
                    United States
                    Member #30470
                    January 17, 2006
                    9107 Posts
                    Online
                    Posted: September 1, 2014, 7:12 pm - IP Logged

                    I'd rather see them get rid of all the gimmicks - Extra Shot, Ez Match, etc, and restore things to what they were. Lucky Day Lotto was 5/39 for example, now it's 5/45.

                    On scratchers where you match a single digit number to win, usually a 5, 7, 8, or 9, two digit numbers were added to the player's numbers, no need for that.

                    Those who run the lotteries love it when players look for consistency in something that's designed not to have any.

                    Lep

                    There is one and only one 'proven' system, and that is to book the action. No matter the game, let the players pick their own losers.

                      Avatar
                      New Member
                      warrenville,illinois
                      United States
                      Member #55739
                      October 17, 2007
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                      Posted: September 2, 2014, 9:28 am - IP Logged

                      i hope they get rid of my3 but keep the fire ball in. much better odds to win with fireballLurking

                      I agree with getting rid of my3. It is a complete waste of money. I would also like to see Hit or Miss go.

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                        chicago
                        United States
                        Member #3676
                        February 10, 2004
                        420 Posts
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                        Posted: September 8, 2014, 11:48 am - IP Logged

                        I was chatting with a retailer and he told me MY 3 and Hit or Miss will be gone, as no one buys them. I don't understand why they create these games as they are just smoke and mirrors. Unless you can tinker with the payback percentage offering more games with the same payback just dilutes the pool. Only so much money to go around and churn.

                        My last straw was when Northstar changed the Lucky Day Lotto matrix to 1 of 45 making it more than doubly hard to hit the jackpot. They mislead in the advertising "better prizes" but they don't tell you it is way harder to hit those prizes. Northstar wants to make every game have a mega jackpot to it thinking that will fuel sales. But since more money is paid out on top or top heavy it is the opposite. There is no churn hence less sales.

                        I will be curious to see what Illinois does here. My advice stop pushing mega jackpots on games like Lucky Day or scratchers. We already have that with mega, pb, and the new monopoly game coming. Quinn should increase the payback percentages on these games to compete better with horses or casinos. That is the smart way to go about it. Whenver a track descreases takeout their handle is higher and vice versa.

                        Also wouldn't it be awesome if a Governor was able to say no state income taxes on lottery winnings! Maybe the feds will do the same one day. Yeah right.

                          Scratch$'s avatar - sm lottery.jpg

                          United States
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                          September 5, 2014
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                          Posted: September 10, 2014, 1:54 pm - IP Logged

                          Illinois has a pretty decent lottery - their scratchers are some of the best in the nation. Hopefully they'll find a good management company that will keep them on the right course.

                          Scratchers ~ Cash 5 ~ Powerball ~ Mega Millions

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                            Bondi Junction
                            Australia
                            Member #57242
                            December 24, 2007
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                            Posted: September 14, 2014, 7:51 pm - IP Logged

                            They should have given the contract to Camelot, they operate the UK lottery. It is the most successful lottery in the world.

                            We all get a lot out of lotteries!