Atlanta Firm Appears to Have a Lock on Lottery
The company that bankrolled last year’s successful state lottery initiative campaign appeared Friday to be the only qualified bidder for California’s multimillion-dollar instant lottery ticket contract.
Scientific Games Inc., an Atlanta-based firm, looked like the winner of the estimated $40-million to $50-million one-year contract despite a surprise 11th-hour entry in the sweepstakes by a Canadian ticket supplier.
A representative of British American Bank Note Inc., the largest supplier of lottery tickets in Canada, hauled several bulky cartons of ticket bid information into lottery headquarters here less than 24 hours before Friday’s 2 p.m. bidding deadline. Gaston Boulanger, president of the firm, said, however, that his company did not comply fully with the controversial financial disclosure requirement in California’s lottery law, a provision that critics say favors Scientific Games.
Boulanger said in a telephone interview from Montreal that the limited financial disclosure information contained in his bid meets the “spirit” rather than the letter of the law.
Lottery officials said they will not open any bid material unless it is accompanied by the required financial disclosure data.
Scientific Games’s bidding material, contained in nine large cardboard boxes, included three cartons of financial disclosure material, and British American Bank Note, a division of Canada Bell Enterprises, produced only one briefcase-sized container of such disclosure data.
Why did British American Bank Note go to the trouble of providing the detailed bidding material, knowing that it was not complying with financial disclosure requirements?
“We feel that we’re within the spirit of the law,” Boulanger explained, “and we leave it to the Lottery Commission to determine whether we’re an acceptable bidder.
“There’s a saying in the lottery business,” he added. “You can’t be a winner if you don’t buy a ticket.”
Lonnie Mathis, instant game coordinator for the state Lottery Commission, said M. Mark Michalko, the newly named lottery director, will announce the low bidder on Thursday.
After a week during which the winner can be appealed, Mathis said, the director is expected to make a final recommendation to the Lottery Commission, and the contract is to be awarded June 3.
Lottery officials hope to begin sale of the instant “scratch-off” tickets in September or October. Scientific Games estimates that 1.9 billion tickets will be printed under the first year’s contract.
Disclosure Requirements
The financial disclosure clause of the state lottery initiative requires detailed personal financial data from officers, directors and major stockholders of not only potential suppliers, but also from officials of parent companies.
Critics say the requirements, which would be loosened by a bill stalled in the Legislature, gives Scientific Games an advantage in gaining lottery contracts because the company’s parent firm, Bally Manufacturing Corp., already provides such data in order to meet casino licensing requirements in New Jersey.”
Scientific Games, however, is easily the largest supplier of instant tickets in the United States and has gained most of its contracts in states that do not require such strict financial disclosure.
Scientific Games, apparently confident that it will win California’s instant ticket contract, is opening a ticket printing plant in Gilroy, south of San Jose.
