Seeking to justify a price tag of nearly $32 million more than a competitor to run the New Jersey's lottery for the next five years, representatives of the state's lottery operator said Wednesday that their system is more convenient for vendors and would result in less down time and lost revenues for the state.
Representatives for GTech, which won a new contract despite bidding $106.7 million to Scientific Games' $75 million, said the higher price comes with more assurance that its terminals are twice as reliable as the existing ones — meaning fewer lost sales for the lottery due to repairs of 6,000-plus lottery terminals throughout the state.
"The more this terminal goes down, the more loss of sales you get," said Richard S. Meehan, director of hardware development for GTech. "That's why we design the terminal to go down as little as possible."
Representatives for Scientific Games, which is contesting the bid in a quasi-court proceeding before former Supreme Court Justice Daniel J. O'Hern Sr., have testified that the state's evaluation committee exaggerated their company's weaknesses while ignoring any of GTech's.
Scientific Games was criticized among other things for its terminal design, because its bar code scanner is located on the right, not center, of the machine.
One of the company's lawyers, Dana Klinges, who has tried to prove that there is little difference in size between the two proposed terminals, said any lost counter space for retailers could be offset with different models of the plastic racks where instant tickets are stored.
"If the state had to pay an additional cost for plastic instant ticket dispensers, do you think it would cost $32 million?" Klinges said.
Most of the proceedings to date have centered on the two companies' technical ability to upgrade the state's lottery network and terminals — something that will be required of whichever company that wins the contract.
The hearings will now shift to the ethics of the deal.
Scientific Games has said the state was biased toward the incumbent and skewed by a conflict of interest involving the MWW Group — a firm that had a public relations contract with the lottery while lobbying for GTech.
MWW officials have said their roles as lobbyist and promoter never crossed.
Former state Attorney General John J. Farmer Jr. is slated to testify today for Scientific Games on the appearance of impropriety, while GTech is expected to counter with two collegiate legal ethics experts that there was no conflict of interest.