Monday, July 23, 2018
Politics

Was the state's massive lottery contract an illegal bet?

TALLAHASSEE — Did the Florida Lottery break the law when it agreed to spend $16.9 million on a 14-year contract to lease thousands of lottery ticket vending machines from a politically connected company without the Legislature's approval?

That was the question before Leon County Circuit Court Judge Karen Gievers on Monday in another high-stakes legal battle started by House Speaker Richard Corcoran, R-Land O'Lakes.

Last month, Corcoran and the Florida House sued Lottery Secretary Tom Delacenserie and his agency, which is under Gov. Rick Scott. The suit alleges Delacenserie overstepped his authority when he signed a contract with IGT Global Solutions Corp. in an attempt to get around the Legislature's refusal to authorize more full-service vending machines.

The fight, however, is more than a dispute over a contract. It goes to the heart of the budgetary power that Corcoran claims has been abused and corrupted in Florida, in part because state agencies and lawmakers have let special interests reign.

Corcoran in January also sued Visit Florida for refusing to disclose its $1 million contract with rapper Pitbull but withdrew the lawsuit when the agency agreed to make the deal public.

This time, House general counsel Adam Tanenbaum argued that by entering into the new contract that increased the number of self-service vending machines from 500 to 5,000 across the state and agreeing to pay for those machines through a percentage of ticket sales, it obligated the state to pay $12.9 million more than the Legislature authorized in the 2016-17 budget. He asked the court to invalidate the contract and order the Lottery Department to try again.

"After asking for an increase in the number of machines and having those requests rejected . . . the Florida Lottery drew an item and ultimately signed a contract that blew up that whole structure," Tanenbaum said.

But the agency would not back down. It hired Barry Richard, the Greenberg Traurig lawyer who represented former President George W. Bush in the 2000 U.S. Supreme Court decision Bush vs. Gore. Richard said Corcoran's criticism is not only off-target, but unprecedented.

He quoted state law that requires the Department of the Lottery to "maximize revenues" by operating as an "entrepreneurial enterprise" and said the House's objection is an illegal attempt to "micromanage an individual contract."

"It is widely accepted in this state and others that the contracting power is a quintessential power of the executive branch," Richard said. "Entering into long-term contracts provides the state with the best benefit and a maximization of its revenue. . . . They may have violated a process" that the House and Corcoran think they should have followed "but it does not violate the law."

Mike Manley, deputy chief of staff and legislative affairs director for the Florida Lottery, testified that five times since 2003 the lottery made more money than expected from its ticket machines, and therefore had to pay the vendor more than the Legislature authorized. Each time, the Legislature agreed.

Tanenbaum countered that this time the agency acted first and planned to get permission later. He said state law prohibits an agency from both soliciting and signing a contract that exceeds the amount of money authorized by the Legislature.

The contract, which was signed in September 2016 to run until 2028, changed the way the state pays for leasing the ticket sales machines by giving the company a fixed percentage of sales from each machine, rather than pay them with a flat $500 per machine fee.

Summer Silvestri, procurement director for the Florida Lottery, testified that by agreeing to extend the contract to 2031, the agency was able to negotiate a lower percentage fee, saving the state an estimated $18 million over the life of the contract.

House Appropriations Committee deputy staff director Bruce Topp testified that the contract is "a departure from the way we've operated for many years."

IGT's lobbyists and principals have been longtime contributors to Scott and his Republican predecessors. The company's predecessor GTECH gave $25,000 to Scott's re-election campaign in 2014.

Contact Mary Ellen Klas at [email protected] Follow @MaryEllenKlas

Comments
Trump’s Putin fallout: Inside the White House’s tumultuous stretch of walk backs

Trump’s Putin fallout: Inside the White House’s tumultuous stretch of walk backs

WASHINGTON - Executive time began early on Thursday, just after sunrise.Feeling exasperated and feisty as he awoke in the White House residence, President Donald Trump firedoff his grievances on Twitter about how the media had been covering his Helsi...
Published: 07/22/18
Tampa Bay and Florida businesses expect tariffs to drive prices up

Tampa Bay and Florida businesses expect tariffs to drive prices up

TAMPA — Tariffs imposed by the Trump administration and other countries are beginning to push up prices and depress demand in spots around the Tampa Bay area and Florida, business executives say."We’ve definitely seen that the tariffs have increased ...
Published: 07/20/18
March column: Is Congressional District 16 more flippable? What about District 15?

March column: Is Congressional District 16 more flippable? What about District 15?

In the wake of good fundraising news for Democrat David Shapiro, who is running against Rep. Vern Buchanan in Congressional District 16, political analysts are upping their odds of Shapiro’s winning. But what about Congressional District 15, where Re...
Published: 07/20/18
Trump says he’d have no problem beating former VP Biden in 2020

Trump says he’d have no problem beating former VP Biden in 2020

WASHINGTON - President Donald Trump said in an interview broadcast Thursday that running against Joe Biden in 2020 would be "a dream," claiming that Barack Obama "took him out of the garbage heap" to make him his running mate in 2008.Trump was asked ...
Published: 07/19/18
At St. Pete rally, protesters call Trump’s remarks on Russia ‘treason’

At St. Pete rally, protesters call Trump’s remarks on Russia ‘treason’

ST. PETERSBURG — Linda and Jack Miller braved the humidity at Demens Landing on Wednesday night for a simple reason: "Treason," said Linda Miller, 66. The St. Petersburg couple joined more than 100 protesters toting signs, pins and megaphones...
Published: 07/18/18
Updated: 07/19/18
Meet the man who might have brought on the age of ‘downloadable guns’

Meet the man who might have brought on the age of ‘downloadable guns’

During the summer of 2012, Cody Wilson hung around J&J, a car-repair shop run by two "goofy" guys in their late 20s. The Austin warehouse was crowded with engine blocks, car parts and Pelican boxes that never seemed to have been opened, but the 24-ye...
Published: 07/18/18
‘She was like a novelty’: How alleged Russian agent Maria Butina gained access to elite conservative circles

‘She was like a novelty’: How alleged Russian agent Maria Butina gained access to elite conservative circles

WASHINGTON - For nearly five years, the young Russian political-science student was an unusual fixture at the most important events of the U.S. conservative movement.Maria Butina, who was indicted this week on charges of being a covert Russian agent,...
Published: 07/18/18
PolitiFact: Fact-checking the Donald Trump-Vladimir Putin summit

PolitiFact: Fact-checking the Donald Trump-Vladimir Putin summit

President Donald Trump and President Vladimir Putin made inaccurate statements to the media following their one-on-one talks in Helsinki about election meddling, global terrorism and nuclear nonproliferation.Here’s a rundown of our fact-checks.Trump:...
Published: 07/17/18
Obama gives Trump sharp rebuke in Mandela address on values

Obama gives Trump sharp rebuke in Mandela address on values

JOHANNESBURG — Former U.S. President Barack Obama on Tuesday took aim at "strongman politics" in his highest-profile speech since leaving office, urging people around the world to respect human rights and other values now under threat in an imp...
Published: 07/17/18
Romano: Excuse me Gov. Scott, but you’re a hypocrite

Romano: Excuse me Gov. Scott, but you’re a hypocrite

Hypocrisy, thy name is Rick Scott.And, yes, I owe Shakespeare an apology.But I think Florida’s governor owes all of us an apology.This isn’t about one man’s opinion, and it isn’t about philosophical differences. This is about a politician who is publ...
Published: 07/17/18