LITTLE ROCK, Ark. — A Georgia lottery equipment company will supply scratch-off tickets to Arkansas' fledging lottery, an oversight panel decided Wednesday.
The Arkansas Lottery Commission awarded an instant ticket contract worth 1.75 percent of net ticket sales to Alpharetta, Ga.-based Scientific Games Corp. The deal is expected to be worth millions of dollars based on a $400 million annual sales estimate.
Commissioners also awarded an advertising contract to a Little Rock firm, as the panel speeds toward a possible late September start date for the scratch-off games. However, a rejected ad agency said it filed a formal complaint over a bidding process it described as flawed.
The nine-member lottery commission passed the scratch-off game measure after little debate. Evaluators placed Scientific Games ahead of two other businesses bidding for the contract, Pollard Banknote of Canada and GTECH of Providence, R.I.
Lottery Commission Executive Director Ernie Passailaigue praised the three companies, but said Scientific Games offered the most competitive bid. Passailaigue said after the meeting that he believed the company could put tickets in place to begin sales by Sept. 28. However, an evaluation sheet filled out by lottery staffers said Scientific Games' earliest starting date was Oct. 1.
"The start date is going to happen," Passailaigue said.
Shares of Scientific Games fell 19 cents in trading Wednesday to close at $18.18.
Scientific Games was recented sued a second time by Gameologist Group, alleging that the lottery giant infringed on Gameologist's trademark on its instant game design. (See www.lotterypost.com/news/198391)
Arkansas Lottery Commissioners also voted Wednesday to have The Communications Group of Little Rock handle advertising the games as they start. The contract calls for the ad agency to receive 5 percent commission on ads it places and hourly rates for its employees, Passailaigue said.
Six ad agencies competed for the contract, though only two offered presentations to lottery employees Tuesday. Gary Lay, owner of GWL Advertising in Little Rock, told commissioners he filed a formal complaint over the bidding process with the state Department of Finance and Administration.
Lay said later that he felt some of the requirements for the bidding process, like offering independent audits and net profits, unfairly cut out his business and others.
"It's not our intention to make a ruckus," Lay said. "Our contention is for it to be fair."
Passailaigue dismissed the complaint, saying the requirements would protect taxpayers from "fly-by-night operations."
DFA deputy director Tim Leathers said the agency would have to review the complaint, though the lottery commission has some been granted some exemptions to state bidding laws.