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NJ moves to privatize lottery sales, marketing

New Jersey LotteryNew Jersey Lottery: NJ moves to privatize lottery sales, marketing

TRENTON, N.J. — Four companies interested in running portions of the New Jersey Lottery attended a mandatory information session in Trenton last Thursday, the first step toward privatization.

The state Treasury Department is looking to hand over sales and marketing operations to a private vendor next year. The state would retain ownership of the lottery under the plan, and state employees would continue to manage its operations though those jobs are not guaranteed.

New Jersey has the eighth largest state lottery in the country and employs 150 people, most of whom manage the network of lottery retailers.

The state believes a privately managed lottery could bring in more revenue, which it shares with education and social services programs. Last year, the lottery grossed $2.8 billion in revenue, and $950 million of it was directed to state programs and institutions.

"The goal of contracting out the lottery's sales and marketing functions is not to save money but to expand the lottery's revenue base so that it can continue to support the state's education programs and its institutions that serve veterans, the developmentally disabled and psychiatric patients well into the future," Treasury spokesman Bill Quinn said.

New Jersey isn't the only state looking into privatizing state lottery programs. Indiana is set to complete a deal to privatize its lottery by Nov. 1. Pennsylvania is researching whether to outsource its lottery and Illinois took its lottery private last year.

In New Jersey, the selected vendor would be required to pay $120 million up front and sign a 15-year contract.

Private vendors that intend to submit proposals to the state listened to a one-hour presentation Thursday morning. Afternoon site visits to lottery headquarters and warehouses also were required. The four vendors that attended were GTECH Corp., which supplies lottery technology in New Jersey; Camelot Group, Scientific Games and Intralot.

Vendors have until Nov. 15 to submit their proposals.

Carole Hedinger, the lottery's executive director, told the prospective contractors that New Jersey's demographics and other factors favor significant sales growth. The vendors would be responsible if revenue fell below expectations but would realize bigger profits if revenue exceeded targets.

In the current fiscal year, the lottery is on pace to generate nearly 5 percent more revenue than last year, Hedinger said.

AP

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17 comments. Last comment 4 years ago by haymaker.
Page 1 of 2
ressuccess's avatar - Lottery-043.jpg

United States
Member #93164
June 23, 2010
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Posted: September 11, 2012, 2:11 pm - IP Logged

I wonder why New Jersey decided to private their lotto sales?


    United States
    Member #111442
    May 25, 2011
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    Posted: September 11, 2012, 2:24 pm - IP Logged

    I wonder why New Jersey decided to private their lotto sales?

    Probably Agoraphobia, which is a fear of conducting business in public places. Privatizing would help minimize that phobia.

      haymaker's avatar - Lottery-012.jpg
      Egg Harbor twp.south Jersey shore
      United States
      Member #112968
      June 29, 2011
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      Posted: September 11, 2012, 7:07 pm - IP Logged

      sales and marketing, thats OK as long as the state operates the draw and it stays a ball draw.

      Extraordinary Popular Delusions & the Madness of Crowds    -- Charles Mackay  LL.D.

        RedStang's avatar - tallman zps6gf4inoc.jpg
        NY
        United States
        Member #121961
        January 21, 2012
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        Posted: September 12, 2012, 1:43 am - IP Logged

        Only way i see expanding the revenue base would be to introduce a boat load of new games. Next years outcome should be interesting.

          Avatar
          Pennsylvania
          United States
          Member #78052
          August 6, 2009
          785 Posts
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          Posted: September 12, 2012, 2:03 am - IP Logged

          Don't trust this move by NJ.   Why are they selling?   And think to yourself -  who is buying?

          Life Is Wonderful If You Don't Weaken

            Avatar
            New Member
            flagstaff, Arizona
            United States
            Member #118387
            October 30, 2011
            14 Posts
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            Posted: September 12, 2012, 5:34 am - IP Logged

            sales and marketing, thats OK as long as the state operates the draw and it stays a ball draw.

            I too am in agreement with limited privatization, though I am wary of total privatization of lottery games, a hundred percent. The state should still oversee the lotto games. Total privatization of the lotto games may suffer the same pitfalls of privatizing social security.

              dpoly1's avatar - driver
              PA
              United States
              Member #66141
              October 16, 2008
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              Posted: September 12, 2012, 12:38 pm - IP Logged

              California now has 4 Mega Millions Jackpot wins in 2012 ............

              Disapprove

              dpoly1 - Playing the lottery to save the jobs of those that build, transport, sell & maintain luxury items! -

               

              Eschew Poverty ........... Vote Conservative!


                United States
                Member #111442
                May 25, 2011
                6323 Posts
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                Posted: September 12, 2012, 12:42 pm - IP Logged

                California now has 4 Mega Millions Jackpot wins in 2012 ............

                Disapprove

                Go West young man.....go West!!!  Yes Nod

                  dpoly1's avatar - driver
                  PA
                  United States
                  Member #66141
                  October 16, 2008
                  1672 Posts
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                  Posted: September 12, 2012, 12:49 pm - IP Logged

                  Go West young man.....go West!!!  Yes Nod

                  The winner/s probably only get $1 after all of the California Taxes are taken out!

                  Thud

                  dpoly1 - Playing the lottery to save the jobs of those that build, transport, sell & maintain luxury items! -

                   

                  Eschew Poverty ........... Vote Conservative!


                    United States
                    Member #111442
                    May 25, 2011
                    6323 Posts
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                    Posted: September 12, 2012, 12:54 pm - IP Logged

                    The winner/s probably only get $1 after all of the California Taxes are taken out!

                    Thud

                    Really? I thought it was less than that.  LOL

                      Cletu$2's avatar - Lottery-050.jpg
                      S.E.Iowa
                      United States
                      Member #120504
                      December 21, 2011
                      534 Posts
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                      Posted: September 12, 2012, 3:07 pm - IP Logged

                      The winner/s probably only get $1 after all of the California Taxes are taken out!

                      Thud

                      I don't think California taxes lottery winnings,which is surprising seeing as the state is bankrupt.Go figure!

                      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

                        whiteballz's avatar - Lottery-015.jpg
                        Nutley, New Jersey
                        United States
                        Member #131058
                        August 1, 2012
                        875 Posts
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                        Posted: September 13, 2012, 4:08 am - IP Logged

                        The winner/s probably only get $1 after all of the California Taxes are taken out!

                        Thud

                        california doesn't tax the lottery because the lottery is already a tax.

                        .

                          Avatar
                          Texas
                          United States
                          Member #132455
                          September 4, 2012
                          483 Posts
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                          Posted: September 13, 2012, 11:16 am - IP Logged

                          The goals of NJ lottery are fantastic.  However, this will take gradual transition on the part of the management.


                            United States
                            Member #116268
                            September 7, 2011
                            20244 Posts
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                            Posted: September 13, 2012, 11:19 am - IP Logged

                            California now has 4 Mega Millions Jackpot wins in 2012 ............

                            Disapprove

                            Congratulations to CA. awesome work!!