Tag Archive: lottery

Christie Gambled with Your Money and Lost. Again.

In a world where government revenue is shrinking and demands for services are increasing, state governments continue to look for ways to generate more income. One such method has been state lotteries, which have been around in their present form since the mid-’80s.

In spite of the fact that state lotteries are really a form of regressive taxation, they have become a popular and essential element of the state fiscal budgeting process. In New Jersey, they represent the fourth largest source of revenue. But that source has been decreasing over the past several years.

Exacerbating the problem is the fact that in the Garden State, the administration of the lottery is outsourced to a for-profit consortium, partially owned by foreign interests, that has been a solid donor to GOP political causes, including Chris Christie’s Republican Governor’s Association. And to add insult to injury, the firm that lobbied for this lucrative outsourcing scheme was Wolff & Samson – the same David Samson that’s embroiled in the Bridgegate scandal. Of course, back when this contract was being “competed”, as Seth Hahn – the political director of the CWA – points out, potential bidders knew about the Christie/Samson connection and probably figured it was not worth their effort to vie for this contract. Hahn said that “The M.O. of the Christie Administration is not to put good government first.” The consortium that eventually received the contract was the sole bidder.

Today, the Bloomberg News Service reported that instead of meeting its goal of a 7.4% increase in revenue, the privately-run New Jersey Lottery is facing a shortfall of 9.2%, or $24 million – money that is desperate needed by the state, whether it is for education, aid for the disabled, or one of Christie’s unnecessary senatorial elections.

State Relying More and More on Taxes for the Stupid

Back a billion years ago in the 1970s New Jersey was in a financial crisis and decided one of the best ways out was to authorize gambling in Atlantic City and a state lottery.  

Still, the state wound up in a financial crisis again and again.

So last fall they started allowing online gambling which is generating millions.

Still, financial crisis.

And since all that gambling hasn’t amounted to much help we have a lawsuit on sports betting heading to the Supreme Court:

The state of New Jersey has filed an appeal with the U.S. Supreme Court in a last-ditch effort to legalize sports betting at the state’s casinos and horse racing tracks.

The appeal was filed last Wednesday on behalf of Gov. Chris Christie and the state Legislature, state Sen. Raymond Lesniak (D-Union), one of the law’s chief sponsors, said.

Senator Lesniak is a good liberal who fought for marriage equality, defends children in more ways than I can count, works hard to end the death penalty, supports significant gun control regulations, raising the minimum wage, etc.

But he has a bug in his craw about gambling, hoping to bring casino gambling to the Meadowlands and sports gambling to the state.  

Full disclosure: I buy lottery tickets, but only one at a time since I understand statistics.  One is enough to get the thrill of a dream, and odds don’t improve until you spend thousands and even then are quite long.

I also play blackjack and poker in Atlantic City when I’m down there, which isn’t often.  

But what the reliance on gambling for state revenue amounts to is a tax on the stupid. People who don’t have the money to gamble spend food money hoping to make it rich, all so that a few pennies of their lottery ticket or slot losses will go to schools.

It would be nice if we spent more time worrying about jobs and expanding opportunity for New Jersey residents, and not only nice but much more efficient.  More jobs at higher pay would mean more income taxes collected and less need for taxing the stupid.

Hazel Gluck on Marriage Equality

Hazel Gluck is a mother. She’s a former New Jersey legislator. She’s a former state lottery director. She served on the Port Authority board. She’s gay. And she’s a Republican.

At yesterday’s marriage equality press conference, she urged her Republican colleagues in the State Legislature to do the right thing and support marriage equality.

CWA releases 60-second radio spot hitting Christie “insider scam” Lottery privatization

CWA, which represents Lottery workers, today released a minute-long radio ad today, entitled “Sketchy,” sharply criticizing Gov. Christie’s plan to privatize yet something else, the very-profitable NJ Lottery.

The spot carries some of the markers of the classic negative ad, discordant, non-melodic piano in the background, announcer with snide tone in the foreground. Designed to get weary radio listeners to prick up their ears.

More below the fold. But have a listen. What do you think, Blue Jersey?

Saving New Jersey Jobs

There have been a couple of posts on Blue Jersey lately (here and here) regarding Governor Christie’s plan to privatize the state lottery and ship jobs out of New Jersey. It’s hard to understand the governor’s motivation since the state lottery is one of the few revenue streams that are meeting projections. Today, I interviewed Seth Hahn, the Legislative and Political Director of CWA, to learn more about the impact of privatization.

NJ For Sale

Stop Chris Christie from selling the New Jersey Lottery! It makes money for the state and its citizens in need and employs 7000 people in New Jersey!

How many more jobs can New Jersey afford to lose?

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ICYMI: CWA ad against Christie lottery privatization

It never ends with Chris Christie, who like so many in the GOP wants to open more and more government function to privatization and tycoon opportunism. CWA began running this ad this week, charging that Christie’s lottery plan would outsource work to foreign corporations, put even more New Jerseyans out of work and hurt small, local businesses. In a state where the famous governor distracts voters with his carefully crafted Jersey guy act and more TV exposure than Snooki, will this really fly in a state with the 4th-highest unemployment in the USA?

“If it Ain’t Broke, Break it!”

“If it ain’t broke, break it.” That seems to be the mantra of the Christie administration when it comes to the running of the New Jersey State Lottery.

Today, the Assembly Budget Committee convened to discuss the administration’s plan to wrest the sales and marketing for the lottery from state workers and give those functions to a consortium of three for-profit companies, one of which is American, and none of which are located in New Jersey. The three firms submitted the only bid in response to the RFP. As Seth Hahn of CWA remarked in his testimony,

One has to wonder if there was any competition at all, or if the … companies planned from the outset to come together to stop competition. Other questions arise about whether this is competition or collusion.

These same companies are in a partnership to run the Illinois lottery, and the performance of that consortium has been unblemished by success, with multi-million dollar lawsuits flying around, and the citizens of the Land of Lincoln suffering from revenue shortfalls from that lottery. Back here in New Jersey, in the late 1990’s a young prosecutor named Kim Guadagno prosecuted a principal in one of the bidding companies for money laundering and political kickbacks. How times have changed!

It’s not that the New Jersey lottery is underperforming. According to Hahn, a report from an independent entity showed that sales have increased in the last decade, we are fifth in the nation in per capita sales, and gross margins are at the top of the list, “making New Jersey’s lottery the most efficient lottery in the country.”

The Assembly panel heard only one side of the story. State Treasurer Andrew Sidamon-Eristoff and Lottery Executive Director Carole Hedinger refused to testify. Their claim that it would be inappropriate during the negotiations with the private entity is a red herring since they could certainly keep the legislature informed in a closed session or answer questions not directly related to the negotiations.

Of course, it’s no surprise that Governor Christie eschews transparency and does not treat the legislature as a co-equal branch of government. This is ARC Tunnel déjà vu.

The bill requiring legislative approval for privatization of the lottery passed in the Budget Committee on party lines. If it passes in the full Assembly and then in the Senate, I’m sure Governor Christie will veto it faster than you can scratch off the numbers on a lottery card.

The lottery is one of only two of fourteen major revenue streams that is meeting their numbers this fiscal year. But the administration’s actions and lack of transparency put that in jeopardy. The legislature should put the brakes on this initiative until all the facts are known.

Christie’s Secret Plan to Sell the New Jersey State Lottery and Destroy Small Business

Hetty is NJ director of CWA. Promoted by Rosi

In a few days “bids” will be due on a secret plan to sell the New Jersey Lottery. It isn’t being called a sale or “monetization” as Corzine called it, but that’s what it is.  It’s being hidden under the cloak of privatization of sales and management.

I’ll get to the details in a second.  This is a bad deal and the fix may be in.  But we are building public support to defeat the plan.  For starters, you can head on over to www.biggamblenj.com. Sign our petition to tell the governor we need to stop this deal to prevent fraud and harm to locally-owned small businesses.  Follow our campaign on twitter, @BigGambleNJ. And most importantly, call the governor and your legislators and demand that they do everything they can to put a stop to this.

Here’s what the Governor is doing. The winning bidder will pay the State $120 million to buy I mean to “manage” lottery sales.  The State will get its legally required cut of lottery sales, which means that the contractor has to expand sales and cut corners in order to make its profit.  

All the experienced State Lottery workers will be laid off, and the contractor will handle lottery sales.  In order to expand the sales they will favor Big Box stores and chains and online lottery sales so that they don’t have to go out and visit tiny newsstands and gas stations.  They can charge fees for lottery machines and to fix the machines. Governor Christie estimates that the winning bidder will make $1 billion.  

This will have a devastating impact on small and local businesses throughout New Jersey that depend on lottery sales.  If people buy lottery tickets from Walmart instead of their town newspaper store, they also don’t buy gum, cigarettes, coffee and a snack for the road from their local store.  The deal is a business killer.

Powerball helps NJ Lottery report record $2.6 billion in revenues

People may be struggling in this economy, but the NJ Lottery has posted record revenues this year. From the release put out by the lottery:

…early un-audited Fiscal Year 2010 returns show that the New Jersey Lottery has shattered previous revenue estimates, surpassing $2.6 billion in sales and $900 million in aid to education and institutions for the first time in its four-decade history. These estimated figures also mark the third consecutive year that sales have crossed the $2.5 billion mark.

These early FY’10 estimates indicate that the Lottery’s gross revenues of $2.6 billion will top the previous record by nearly $66.7 million dollars and will allow it to contribute approximately $924 million to State-sponsored programs, the largest revenue contribution amount in Lottery history, shattering the old record of $887.2 million set in FY2009 by nearly $37 million.

We’ll see what the final revenues say once all the auditing is done. The lottery stands in contrast to the gaming and horse racing industries which have seen precipitous declines in their revenues. You can see where the lottery money goes here.