Comment on Lottery privatized under Christie falls $136 million short

Lottery privatized under Christie falls $136 million short

Higher costs associated with the private company that Christie hired, Northstar New Jersey, have cut the state's income for the second straight year, creating a $136 million shortfall in the state's 2015 budget, according to internal documents obtained by The Associated Press. Christie's office directed questions to the state's Treasury Department, which praised the company's "proactive and creative efforts" as the reason losses weren't even higher. The underperformance raises questions about the privatization strategy championed by Christie, who promoted lottery outsourcing as a way to shrink the government's payroll and bring in more cash. According to the paper's analysis of Northstar's contracts, New Jersey will likely pay the company around $100 million for its services in the year that ended in June. Much of New Jersey's problems stem from disappointing ticket sales for Powerball and Mega Millions, multistate draw games with a high profit-margin compared to instant-game scratch-off tickets. "The lottery is better off today with Northstar implementing sales, marketing and advertising services than when it was being managed exclusively by state employees," lottery spokeswoman Judith Drucker wrote in an email to the AP. The announcement omitted any mention of how much the state earned from those sales, which the AP obtained roughly two weeks after it asked for documents under the state's open records law.

 

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