After a lengthy fight, Rhode Island-based GTECH gets a 10-year lottery contract.
By STEVE BOUSQUET
Published September 6, 2003
TALLAHASSEE - One of the most lucrative and bitterly contested contracts in state government is changing hands after 15 years.
The Florida Lottery has chosen GTECH Corp. of West Greenwich, R.I., to design and run online games for up to 10 years beginning in 2005. The contract is worth up to $25-million each year, company spokesman Bob Vincent said.
"Florida was one of the largest lotteries in the United States that was not a GTECH customer," Vincent said.
After years of bid challenges, court faceoffs and political battles in the Capitol, GTECH finally dislodged its arch rival, IGT Online Entertainment of Clifton, N.J., as the supplier of 12,000 Florida terminals, tickets, software and other materials.
An IGT subsidiary, Automated Wagering International (AWI), held the contract from the lottery's inception in 1988 and kept it through a protracted legal struggle with GTECH.
GTECH operates 26 of 37 state lotteries. Adding Florida will give GTECH control of the five biggest state lotteries in the U.S., including New York, California, Texas and Georgia.
"It's particularly gratifying in that we went to court after the last procurement and were successful in having the contract declared null and void," Vincent said.
As the GTECH-AWI bare-knuckled brawl continued through the mid 1990s, it spread to the halls of the state Capitol, where one senator described the battles as "ugly wars, because the companies in them are ugly companies."
Two years ago a state appeals court voided a five-year contract between AWI and the state, claiming the Florida Lottery violated bidding laws. That decision set the stage to reopen the bids that resulted in GTECH's victory.
A seven-member team of lottery officials chose GTECH on the basis of a superior technical proposal and a slightly lower price during the first six years of the contract. Weighted evaluation criteria awarded points on communications, software, games, marketing, staffing, security and corporate capability.
Vendors will see some changes in the system under GTECH's control, but customers looking to strike it rich won't notice any differences, a lottery spokesman said.
In the midst of the lengthy bid review process, an internal investigation revealed that former Lottery Secretary David Griffin and four senior staff members accepted shipments of lobsters, crab claws, steaks and college basketball luxury box tickets from two vendors seeking the contract.
Griffin, who was executive director of Gov. Jeb Bush's second term transition team, resigned as lottery secretary. The other four were fired.
The vendors were not identified in the lottery inspector general's report, but GTECH said it continued to have faith in the review process and agreed to a Lottery Department request not to use the scandal as a reason for challenging the final decision.
"We said that we felt from our perspective that the procurement had been conducted fairly and openly, and we did not have a concern about that," GTECH's Vincent said.
The third vendor seeking the contract was Scientific Games International. The deadline for appealing the decision quietly came and went Thursday, with no challenges filed this time.
"We've had a nice long relationship with the Florida Lottery that we've enjoyed very much," said IGT spokesman Ken Lathrop.
The selection of GTECH also represents a victory for one of the capital's busiest lobbyists and Republican fundraisers, Brian Ballard, who represented the firm throughout the selection process.
GTECH has donated $107,000 to the Republican Party of Florida since 1996, according to the Division of Elections Web site. The total includes $25,000 in 2002. IGT contributed $62,000 in 2002, including $25,000 to the state GOP.
- Times researcher Cathy Wos contributed to this report.
