Jim Rosica
The Florida Lottery went on an illegal spending spree when it inked a multiple-year, $700 million contract for new equipment and “blew up” the state’s budget process, a lawyer for House Speaker Richard Corcoran argued Monday.
The Lottery’s lawyer countered that it takes money to make money, and the agency simply did what lawmakers told it to do: Follow “its singular purpose” of maximizing its revenue for education, Barry Richard said. Lottery proceeds go to the state’s Educational Enhancement Trust Fund.
Both sides gave closing arguments after a one-day, non-jury trial over Corcoran’s contention that the contract with International Game Technology (IGT) went “beyond existing budget limitations,” as House general counsel Adam Tanenbaum told Circuit Judge Karen Gievers.
Instead of first asking for approval from lawmakers in charge of the state’s purse, the Lottery went rogue last year by cutting a deal that costs the agency 37 percent more than a prior equipment contract, Tanenbaum suggested.
“If you want to do more, you have to ask for permission first,” he said.
Gievers did not rule immediately from the bench, saying she would take the matter “under advisement” and issue a decision “as quickly as I can.” The 2017 Legislative Session starts Tuesday.
Richard told Gievers the Lottery just followed its legislative mandate to act as an “entrepreneurial business enterprise” that’s allowed to do “alternative procurement” compared to other state agencies.
“The Lottery has done exactly as the Legislature has asked it to do,” he said. The agency surpassed $6.2 billion in sales during 2016, records show.
“It has been extraordinary successful, and the Legislature has never said, ‘You’re making too much money,’ ” Richard argued.
He further argued Corcoran was overstepping his constitutional bounds: “The Legislature’s function is to appropriate funds and make law. Contracting power is a quintessential power of the executive branch,” he said, granting that legislators can, however, place limits on that power.
Richard earlier in the day questioned Summer Sylvestri, the Lottery’s procurement director. She explained the agency negotiated a deal based on percentage of lottery ticket sales, and away from a flat rate based on the number of vending machines leased.
IGT then agreed to come down on the percentage after the Lottery agreed to exercise the first of three available 3-year renewal options on the 10-year deal. That saved the state $18 million, she testified.
The new deal also provides much more than the previous equipment contract, including in-store signage, self-service ticket checkers and upgraded security in the communications network.
