Wednesday June 12,2013 : NEW JERSEY GOVERNOR WINS ON LOTTERY PRIVATISATION (Update)
Privatisation can go ahead despite political and trade union opposition
New Jersey governor Chris Christie won an important victory this week in his drive to privatise the state lottery despite political and trade union opposition to his plans to sign a long-term contract with Northstar New Jersey to run the lottery and boost its revenues.
The New Jersey Apellate Division ruled Tuesday that Christie's administration can sign the deal with Northstar, turning over management of New Jersey’s lottery. Earlier, the Communications Workers of America trade union had asked the court to block the contract.
North Jersey.com reports that Northstar New Jersey is a joint venture between Scientific Games, the Ontario municipal pension fund and GTech. It won a 15-year deal earlier this year to manage the lottery in an agreement that includes an upfront payment of $120 million and a commitment to increase lottery profits by nearly $1.5 billion over the life of the contract.
The agreement has been bedevilled and delayed by opposition from the state’s largest public-sector union, which represents lottery workers who could be affected by the privatisation, claiming that it would violate state and federal laws.
The Communications Workers of America also argued that the state violated regulations in selecting Northstar, which was the only company that bid for the contract, whilst political opponents from the Democratic Party asked the US Justice Department to intervene.
Christie's victory was not complete, however; although the two-judge panel allowed the deal to go forward on grounds that the union had not shown that it could cause “irreparable harm,” it agreed to hear the CWA’s appeal on an expedited basis.