Lottery Defends Ticket Sales Contract

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TALLAHASSEE (CBSMiami/NSF) – The Florida Lottery defended a long-term contract for ticket sales in a Tallahassee courtroom Thursday, pushing back at a House lawsuit contending the agency had overstepped its authority.

Attorney Barry Richard, an outside lawyer representing the Lottery, told Leon County Circuit Court Judge Karen Gievers that the state agency did nothing wrong in signing the contract with IGT Global Solutions Corp. The House argues that the agreement illegally obligates the Legislature to spend money that it hasn’t yet agreed to shell out.

Richard said the contract, like many signed by state agencies, specifically says that the money due to IGT will only be spent if the Legislature sets the funds aside in the state budget.

“This contract does not contract to spend any monies in excess of the amount appropriated because it says that no monies will be spent unless they are appropriated by the Legislature,” he said.

Gievers set another hearing in the case for March 6, the day before the 2017 legislative session began, with an eye toward getting key witnesses on the stand before lawmakers convene.

After the hearing, Richard told reporters he was perplexed by the lawsuit. He said that, by signing a multiyear contract, the Lottery had actually saved the state money.

“I’m at a loss to understand why we’re doing this,” he said.

But House Speaker Richard Corcoran, one of the main critics of the deal, said the agency’s defense of the contract wasn’t good enough.

“I don’t think they have the right to even do that,” Corcoran, R-Land O’ Lakes, said during a press conference Thursday afternoon. “Agency heads don’t have the right to go around and enter into all kinds of contracts beyond the appropriation authority given to them by the Legislature simply by having a line that says, `if we get approval.’ ”

Related: House Rep. Wants Gambling Warning On Fla. Lottery Tix

The dispute revolves in part around a section of state law requiring that any long-term deal by an agency include the phrase: “The State of Florida’s performance and obligation to pay under this contract is contingent upon an annual appropriation by the Legislature.”

However, the language doesn’t specifically address what happens if the contract calls for the state to spend more money than the Legislature has set aside for a given purpose in any prior year, a key part of the House’s argument against the case.

Lottery Secretary Tom Delacenserie signed the contract with IGT in September. The pact initially ran until 2028, and was essentially immediately extended to 2031 under an option.

The deal also changed the way in which the vendor was paid. In the past, the Lottery has paid a fixed amount to deploy and administer each machine. Under the new deal, IGT will get a slice of the sales of tickets, machines and other services.

Based on projected sales, that would boost the amount the Lottery needs to pay for the contract by $12.9 million in the budget year that begins July 1, according to the House.

The House says state law requires an agency to receive permission from the Legislature before signing a contract that would spend more money in an area of the budget — even in future years — than lawmakers have already allocated for that area.

But Thursday, Richard told Gievers that the House’s argument would actually infringe on the agency’s right to make contracts, under the separation of powers doctrine.

“What the Legislature cannot do is to decree that it must approve every contract,” he said. “Because that places the Legislature in the position of performing a quintessential function of the executive branch.”

The legal fight over the Lottery has played into a wider feud between Corcoran and Gov. Rick Scott. Last week, a spokeswoman for Scott responded to the suit by calling the speaker “a trial lawyer” — an epithet in Republican politics.

The News Service of Florida’s Brandon Larrabee contributed to this report.

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