Constipation is a horrible afflicationIt's hardly news a big priority for Republicans is to privatize whatever they can while they have a hold on power. Last year New Jersey's bribe-taking/Pay-to-play governor, Chris Christie, privatized sales and marketing functions of the state's lottery-- despite the fact that New Jersey had an award-winning lottery and sales had steadily increased when sales and marketing functions were being done by state workers. Average growth over the last decade was just about 3% annually. Only one bid was received. No surprise: it was by a company that had hired two firms with close connections to Christie in the run-up to the bidding process. One was the firm run by David Samson, Christie's now-disgraced former Port Authority Chair who has come under fire for improperly awarding contracts to politically-connected companies. And the other was a firm run by Mike DuHaime, Christie's campaign manager. Trenton lobbyists had a field day. I'm sure this is all just a funny coincidence, of course. (Although, I must admit that I did hear that other firms didn't even put in for it once they saw who was lined up to help grease the wheels.) The "winning" bid for Christie's cronies includes a sweet clause giving the firms a cut of the proceeds not for besting the 3% annual growth that was already rolling, but at the much easier to reach 0.9%-- a criminal giveaway of New Jersey taxpayers' money-- and especially of the money meant for housing homeless veterans, programs for the developmentally disabled and, of course, Christie's bête noire, public education.At the time, the firm held only one other contract in the U.S. for sales and marketing of a public lottery: Illinois, where they were not meeting their sales goals... but then turned around and sued the state in order to retain profits anyway. The final deal that was signed allows the private company to keep a cut of the sales, even if they don't increase sales and perform worse than the public workers.One of the partners in the company that won the contract is GTECH... which wrote a $100,000 check to the Republican Governor's Association shortly after winning said contract. In 1996, Christie's own Lt Gov (then assistant US Attorney) Kim Guadagno, prosecuted GTECH's national sales director for a laundering and kick-back scheme involving New Jersey politicians. She even got slapped on the knuckles for leaking grand jury info on how bad they were.Last week Elise Young, writing for Bloomberg, reported that the New Jersey lottery is missing all its goals. The operators are using Sandy as an excuse, just as Christie does... with boring consistency. Assemblyman Patrick Diegnan, a South Plainfield Democrat, said that’s a lame excuse, given the lottery’s record results in the months after the storm. “It doesn’t make any sense,” said Diegnan, who sponsored a bill vetoed by Christie that would have made lottery privatization subject to legislative approval. “The facts contradict their position.”
Three months after Illinois declared the first privately run U.S. state lottery a failure, New Jersey’s similar experiment is faltering, endangering a program that supports schools and the disabled.Northstar New Jersey Lottery Group’s revenue fell short $24 million in the year ended June 30, even after Governor Chris Christie let the company cut the target. Lottery collections, the state’s fourth-largest revenue source, were down 9.2 percent from July 1 through Oct. 31. The forecast calls for annual growth of 7.4 percent....“The decision to privatize the lottery was rushed; it was done with a great deal of secrecy and there wasn’t enough time for the Legislature to legitimately weigh in,” said Assemblyman John Wisniewski, a Sayreville Democrat. “It was a momentary money grab that solved momentary budget issues.”...Christie, 52, came to office in 2010 saying New Jersey could save at least $210 million a year if businesses handled such services as prison meals and toll-road collections.When he turned to the lottery, critics, including a union that protested the planned firings of more than 60 state workers, and said New Jersey had no reason to change its business. Still, the governor said in January 2013 that “privatization is the right way to go.”Three months later, Christie’s administration hired Northstar New Jersey, a partnership of Gtech, Scientific Games and the Ontario Municipal Employees Retirement System.The company pledged to outdo government’s performance estimates by at least $1.42 billion over the life of the contract... “The contract must be reviewed,” Assemblyman Gary Schaer, a Democrat from Passaic who is chairman of his chamber’s budget committee, said in a statement today. “The Christie administration’s continued failure to meet its own revenue projections puts the state at risk in meeting its budgetary obligations.”
The kickbacks to Christie from this deal included big bucks from two of the three partners who contributed to the Republican Governors Association, while Christie was chairman. In 2013, Gtech gave $101,800 and Scientific Games gave $76,000, according to the group’s disclosure forms.