Intralot Receives Ohio Slots Contract Despite Opposition from GOP Lawmakers

Despite criticisms from GOP legislators, the state Controlling Board agreed on September 15th, 2009 to give a no-bid, 2-year contract worth at least $17.5 million to Intralot Incorporated to provide a computer system to manage 17,500 slot machines.

Lottery Director Kathleen Burke said that she believes that this agreement represents an excellent deal for Ohio. Intralot, which is based in Greece, which be paid whichever is bigger: $1.75 million or 1.435% of all slots earnings minus payouts to gamers. State Representative Jay Hottinger, (Republican-Newark), objected to the agreement, stating that a competitive bidding process is the only option to assure that the state is getting the best possible value.

Burke told the Ohio Controlling Board that the state lottery would look for competitive slots bids whenever it is appropriate to do so. She said that for the meantime, the agreement with Intralot will help the state meet its deadline to have the slot machines operational by May 2010. Last year, Intralot won the contract to manage the state lottery's central operating system and included a provision to create a slot machine operating system.

This will be Intralot's first Video Lottery Terminal central operating system outside of the US. Burke said that if any court challenges affect the plan to install slot machines to the racing tracks, Ohio would be on the hook for Intralot's coasts up to that point. Two lawsuits against the slots plan are pending and a 3rd legal challenge was launched on September 14th, 2009 when three Ohio House members and Ohio Christian Alliance filed a case in the Ohio state Supreme Court.

The latest lawsuit alleged that the slots plans violates a clause in the Ohio Constitution barring the state from going into business with private organizations, in this case the seven racing tracks. State Representative John Adams, (Republican-Sidney) said that this is an underhanded attempt to get casino-style gaming in the state.

Representatives Seth Morgan (Republican-Huber Heights) and Ron Amstutz (Republican-Wooster) joined him. The plan expands the state lottery to include video slot machines and is expected to earn $933 million in 2 years for K-12 education.

Gov. Strickland's spokesperson, Amanda Wurst, said that the constitution gives the governor the power to create terms under which the Ohio Lottery operates and the Ohio legislature gave its support to plan in the budget bill. The Ohio Roundtable, a conservative public policy group from Cleveland, has filed a case against the plan.

Another conservative group, LetOhioVote.org, filed the first case against the slots plan. The suit asked the state Supreme Court to allow the group to start a campaign to put the slots proposal before state voters in November 2010. The seven racing tracks in the state are also required to submit detailed slots applications and the first $13 million payment toward the $65 million per racing track licensing cost.

Thursday, 08 October 2009
Caroline Mitchell