TRENTON – The state is not privatizing the Lottery. That was the assessment by Treasury Department Commissioner Andrew Sidamon-Eristoff.
Sidamon-Eristoff said he felt there have been several “misconceptions” about the state’s seeking interested parties for the management services of the sales and marketing departments of the Lottery.
The treasurer said he finally felt comfortable talking about the plan “without being subpoenaed.”
“We are not privatizing the Lottery,” Sidamon-Eristoff said. “The state will continue to own the Lottery. The division will continue to collect revenue.”
Nearly two weeks ago, NorthStar was awarded a 15-year contract to run the Lottery’s sales and marketing departments. As part of the deal, NorthStar will provide a $120 million one-shot payment.
He said the plan is “not unusual, nor particularly novel” since other states like Illinois, Indiana and Nebraska have done it.
The treasurer said the state is not locked into the plan and can sever its contract with Northstar if the performance is poor. He said if net income targets are not met for two years in a row or three times in five years, the state can pull out.
He added that mom-and-pop retailers will not be negatively impacted, describing them as a most important asset.
Training will be provided to retailers on new packages and marketing strategies, he said.
He said some 60 employees will be impacted although they “will not be kicked out into the street,” as he said they are welcome to apply to Northstar for similar positions.
The company will hire 90 people, nearly double the 50 individuals who currently carry out those duties.
While he said he cannot make a guarantee, he believes many if not all of the affected workers will be picked up by NorthStar.