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N.C. Lottery will start on schedule, director says

Jan 9, 2006, 11:00 am

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North Carolina Lottery

Officials charged with starting a lottery in North Carolina said yesterday that they hope to award two major contracts by Feb. 2, despite a lawsuit intended to stop them.

The officials also said they will soon contract with the state's Alcohol Law Enforcement Division to provide agents to screen lottery retailers.

"We're developing momentum in getting this going," said Charles Sanders, the former Glaxo chairman who heads the N.C. Lottery Commission.

Officials have set April 5 as the target date to start a scratch-off lottery game.

But in a lawsuit that challenges the way that legislators adopted the lottery, lawyers have asked a judge to issue an injunction to stop the games from proceeding.

Tom Shaheen, the lottery's executive director, said that officials expect to receive bids for two major contracts — printing scratch-off tickets and running online games — by Friday.

"They get in Jan. 13, and we want to award these, I believe, by Feb. 2," Shaheen said. "It's very tight."

Two committees will review the bids under close security, and Shaheen will then decide which companies to recommend to the commission.

At least two companies, Oberthur Gaming Technologies and Scientific Games Corp., have said they intend to bid for the instant-ticket contract. Scientific Games and G-TECH have indicated that they intend to bid for the online game contract.

Shaheen said he also hopes to issue a request for proposals from advertising agencies by Wednesday. The contract would involve creative production, advertising purchasing and designing promotional materials to be displayed at stores.

"Basically, we're looking for a full-service advertising agency," he said. "We have tried to incorporate every type of advertising service that we need."

Sanders said that the attorney general's office is also reviewing a two-year contract for the Alcohol Law Enforcement Division to provide 12 agents and three clerical workers to conduct background and security checks on retailers who want to sell lottery tickets.

Although ALE officials estimated that it might take as many as 29 agents to police the lottery statewide, Sanders said that the commission wouldn't need that many agents initially.

"We may go higher — we're just not sure. We don't want to start out with higher than we need," he said.

The commission could hire more agents as the number of retailers grows, Sanders said, and their jobs could later include investigating any reports of potential fraud involving the lottery.

Shaheen said he hopes to award the major contracts, begin building a network of several thousand store outlets and set up regional offices where lottery winners must claim any prizes of $600 or more.

If the regional offices aren't in place by April 5, it's possible that all the initial prizes will have to be claimed at Raleigh headquarters, he said.

Shaheen said that officials have no contingency plans if a judge issues an injunction. But Lottery Commissioner Robert Farris Jr. of Wilson said he is confident that the attorney general's office will defend the lottery. "Either way, I'm sure we're in fine hands," he said.

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