State Rep. Eugene DePasquale, D-York City, in his final day before being sworn in as the state's auditor general, issued a statement about privatization of the Pennsylvania Lottery.

The auditor general-elect, who will be the first Yorker to hold a state office since Gov. George Leader served in the 1950s, said Monday he's glad to see the senate Finance Committee holding a hearing to "finally shed some light on Gov. Tom Corbett's effort to privatize the Pennsylvania Lottery."

"But I am surprised that Gov. Corbett took action late on Friday - after many affected employees left for the weekend - to accept a contract with a foreign corporation to run the lottery before the public hearing," DePasquale said.

Myesha Randle departs Pak’s Food Market in York City.
Myesha Randle departs Pak's Food Market in York City. (Bill Kalina)
"The whole point of this hearing is to shed some light on this process and a contract that could tie the hands of legislators and governors."

'Very disturbing': DePasquale wasn't the lone elected official to be caught off guard by Corbett's announcement.

Calling Corbett's actions "very disturbing" and saying they show "contempt for public oversight," state Sen. Rob Teplitz, D-Dauphin County, said he was surprised that privatization was moving forward without input from state representatives and senators.

"I think we were all caught by surprise on Friday," he said. "It's really a contemptuous act."

Teplitz's district also includes parts of York County.

On Monday, the newly sworn-in Teplitz sat in on his first committee hearing. The topic was privatizing the lottery.

Teplitz's had concerns with the contract and the process Corbett took to award it to London-based Camelot Global Services.

State Sen. Patricia Vance, R-Cumberland County, whose district includes parts of York County, also sat in on the hearing. She too went into it with more questions than answers because little information was provided to elected officials before Corbett's announcement.

"After the hearing we probably know a little bit more," she said.

However, Vance said she also has concerns with how Corbett handled authorizing a contract with Camelot, the company poised to take over day-to-day operations of the state lottery.

Keno: Both Vance and Teplitz raised issued with whether the company can add keno to its menu of games in an effort to expand the lottery.

"I'm not comfortable with the expansion of the lottery," Vance said.

Adding keno has been kicked around in Harrisburg over the years, but nothing has come of it.

A bill to allow the game of chance didn't pass, and a number of officials, including state Treasurer Rob McCord said legislators need to give their blessing in order to the lottery to offer the game.

Camelot representatives told senators that expanding the lottery, which includes allowing keno, would increase revenue to the state.

Vance and Teplitz said that if keno were allowed under the lottery's current operating model, then there wouldn't be a need to privatize.

Audits: DePasquale said he will perform audits to make sure the state's seniors get all the money they're entitled to under the lottery program, said his greatest concern is potentially short-changing seniors.

"The administration has yet to identify how much more it will cost to operate the lottery under private management, but we know transitioning to private management could cost millions of dollars, not including the costs that have already been incurred on legal, financial and other advisers," he said.

DePasquale said he's concerned that the sole bid from a foreign company was reviewed for more than a month and an alternative plan that raised significant substantive issues was given less than three days of review. He said he wants to hear from lottery manager Todd Rucci about the benefits and disadvantages of moving forward with the contract.

"Like many legislators on both sides of the aisle, I question the governor's authority to unilaterally enter such an extensive contract and expand gaming opportunities without legislative input and authorization," he said.

Oversight: If Corbett goes through with the contract, "I will do everything within my power as auditor general to shed light on the entire selection process and make sure every penny possible is going to fund senior programs," DePasquale said.

The union representing state lottery employees, Council 13 of the American Federation of State and County and Municipal Employees, has sued to block the contract, in addition to filing a grievance and an unfair labor practice charge against the Corbett administration.

However, Teplitz said it appears Corbett will do all he can to make sure the contract goes through and the lottery is run by a corporation.

"I think the governor's actions on Friday tell us they are going to push this thing through," Teplitz said.

- Reach Greg Gross at ggross@yorkdispatch.com, reach Christina Kauffman at ckauffman@yorkdispatch.com.