Health - February 15, 2013

Attorney General Kathleen Kane rejects lottery agreement

Pennsylvania Attorney General Kathleen Kane announced at a press conference on Thursday that she had rejected proposed contract for the privatization of the state lottery.  Camelot Global Services, a UK based firm, had been awarded the contract last month.  Kane read a prepared statement and took no questions.

She announced that she found the contract to be unconstitutional—stating that the contract “unlawfully infringing on the General Assembly’s power to make basic policy choices regarding the management and operation of the Lottery.”  She also noted that the allowance and development of electronic games is not authorized by the Lottery Act and “usurps the authority granted by the General Assembly to the Pennsylvania Gaming Control Board.”  The final point made related to the proposal allowing Camelot to be indemnified for “indirect expenses.”  Kane’s office found this to be “an unconstitutional waiver of the doctrine of Sovereign Immunity as set forth in Article I, Section 11 of the Pennsylvania Constitution.”

Governor Corbett said after the announcement that in his term as Attorney General he doesn’t remember rejecting any contracts; noting that most contracts are repetitive and routine.  Though, First Deputy Attorney General Adrian King said in a statement that the lottery contract “is a unique and specialized agreement which deals with complicated constitutional and other issues.” King went on to say that there has not been a contract of this type submitted to the AG’s office for many years.  Corbett can appeal the decision to the Commonwealth Court or he can as the State Supreme Court for immediate consideration.  The Corbett administration has not indicated which direction they are likely to take.  The Camelot bid expires on Saturday.


PA Public Accountants release 2013 Fiscal Responsibility Task Force report

The Pennsylvania Institute of Certified Public Accountants (PICPA) recently released the 2013 report from their Fiscal Responsibility Task Force.  The full report can be viewed here.  Susan Howe, CPA, Chair of the Fiscal Responsibility Task Force made the following comments: 

“Pennsylvania’s two public pension systems have a combined unfunded liability of more than $41 billion and that number is expected to grow over the next ten years if no changes are made.” The Task Force recommended several policy options, including:

  • Maintain current defined benefit pension systems for existing retirees and honor the pensions already earned by current employees
  • Establish a defined contribution pension system for all new employees
  • Require annual plan funding contributions and prevent the ability to defer funding.