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State Roundup: 2013 Setting up to be Historic Year for Pennsylvania

A WINNING BET: Pennsylvania officials say the state will end up with $50 million in new revenues for next year’s budget from the lottery privatization deal.

By PA Independent Staff

HARRISBURG – The Corbett Administration finalized a contract to privatize the management of the state lottery this week, but bigger issues are on the horizon – including a long-awaited transportation funding plan and a renewed effort to also privatize Pennsylvania’s state monopoly on liquor stores.

Judging from this week, 2013 could be an exciting year in the state Capitol.

State moves ahead to private lottery manager

Pennsylvania is on its way to securing a private lottery manager that promises billions of dollars in new profits from the Pennsylvania Lottery.

But discussions about the implications of this arrangement are far from over.

Camelot Global Services has committed to earn more than $34 billion in lottery profits in a 20-year period. Profits benefit programs for senior citizens across the commonwealth.

State officials say this is $3 billion to $4.5 billion more than what the state would make in the same timeframe.

Gov. Tom Corbett said the deal was in the best interests of Pennsylvania’s seniors.

“An apples to apples comparison, taking into account Lottery’s own projections for Keno and Internet products, clearly demonstrates that private industry investment and expertise will grow Lottery profits to support a growing senior population,” Corbett said in a news release.

Should the company not meet its goals, there are termination clauses in the contract that kick in after three years.

But before it’s put into action, Attorney General Kathleen Kane will renew the contract for form and legality, according to the administration. Kane’s office has 30 days to complete the review.

Ranking Democrat lawmakers have reached out to Kane citing violations of federal law inside the contract.

“The PMA poses serious financial and legal questions that have yet to be satisfactorily answered by the Corbett administration,” reads the letter.

Camelot has said its business plan involves getting more Pennsylvanians playing the lottery, as well as expanding game operations to include more terminal-based sales and Keno. The goal is to get “a lot of people playing a little, rather than a few people playing a lot,” said Camelot managing director Alex Kovach at a hearing earlier this week.

Liquor privatization possible in 2013

After years of failure, there is a chance 2013 will be the year Pennsylvania ditches the state monopoly for liquor sales.

Sources who have attended a series of meetings with the administration in recent weeks to help craft a still-unfinished proposal are hopeful that an announcement will be made in the next two weeks – before Gov. Tom Corbett gives his annual budget address, scheduled for Feb. 5.

Several people with knowledge of the discussions say the administration is taking the lead on the issue this time, a notable shift from how Corbett has handled privatization during his first two years in office, when he would make public statements of support but often follow that up by telling lawmakers to put a bill on his desk before he would discuss specifics.

Signs now point to the governor taking the lead, with an announcement planned for the week of Jan. 28.

The administration has been tight-lipped about the privatization plan, but Eric Shirk, a spokesman for Corbett, said there are several goals including “consumer choice, increased convenience and getting the state out of the liquor business.”

New row officers sworn in

Swearing-in ceremonies on Tuesday marked the first day in office for both Attorney General Kathleen Kane and Auditor General Eugene DePasquale.

Kane, who was the top vote-getter in the November elections, told a crowd of about 500 people in the Pennsylvania State Capitol rotunda that she was going to work to protect the rights and safety of Pennsylvania’s most vulnerable citizens, like children and the elderly.

“I look forward to working with you, starting today, to do the people’s  business, fighting back against public corruption no matter where it exists, protecting our streets from violent crimes and our children from predators who seek to them harm,” Kane said.

DePasquale, a former state representative from York County, said that one of his first orders of business will be a performance audit of the Department of Environmental Protection to ensure that Pennsylvania’s drinking water has not been compromised by natural gas drilling.

He’s already reached out to DEP Secretary Michael Krancer on the matter, and said the audit will begin next week.

Also sworn in Tuesday was Treasurer Rob McCord, who is beginning his second term. McCord talked about how his office has led the state in innovation, citing the $1.6 billion in investment returns that his office earned for the commonwealth, and cuts to wasteful spending.

McCord’s name is often tossed out as a Democrat challenger to Gov. Tom Corbett in 2014. After his inauguration, it was reported that McCord would likely make his decision within the next six months.

Corrupt Philadelphia Traffic Court targeted by Senate Majority Leader

A top lawmaker in the state Senate wants to do away with the corruption-plagued Philadelphia Traffic Court.

Senate Majority Leader Dominic Pileggi, R-Chester, announced Friday his intention to introduce legislation that would close the traffic court and transfer its responsibilities to the Philadelphia Municipal Court.

The Philadelphia Traffic Court was the subject of a stinging review of by the state Supreme Court last year that concluded the court had “two tracks of justice – one for the connected and another for the unwitting general public.”

The recent Supreme Court report said those judges “routinely made, accepted and granted third-party requests for preferential treatment for politically connected individuals.”

A 1997 review of the court described it as a “judicial backwater” and a good place to stash party hacks, generate patronage jobs and earn favors by fixing tickets or throwing out cases, Pileggi said.

State Sen. Shirley Kitchen, D-Philadelphia, said more study was necessary before the court could be abolished entirely — including a determination about whether the Philadelphia Municipal Court could take on more cases.

Unemployment up to 7.9 percent in Pennsylvania for December 2012

Pennsylvania’s unemployment rate ticked up to 7.9 in December 2012 from 7.8 in November, according to data released Friday by the U.S. Department of Labor.

With the increase, Pennsylvania ended the year slightly above the national unemployment rate of 7.8, capping a year in which the state’s rate fluctuated from a low of 7.4 in May to a high of 8.2 in September.

The state added a total of 38,000 jobs during 2012, according to the Department of Labor.

Follow @PAIndependent on Twitter for more.

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