Pa. Attorney General Invalidates Gov. Corbett's Lottery Privatization Plan

By Tony Romeo

HARRISBURG, Pa. (CBS) -- Pennsylvania attorney general Kathleen Kane says a review by her office has determined that a contract with a British firm to manage the state lottery (see related story) is in violation of the state constitution.

Kane's office was obligated to review the lottery management contract for form and legality.  She says the contract is not legal, citing several reasons, the most significant being that the Corbett administration has overstepped its authority.

"The state Lottery Act does not confer express or implied authority upon the secretary of revenue to privatize the operation and management of the Pennsylvania Lottery," Kane said today.  "That authority rests with the General Assembly."

Governor Corbett had proposed an additional $50 million for senior services in the budget based on approval of the contract.

Without mentioning Corbett by name, Kane said it was "disingenuous" to "put the cart before the horse" and promise money to people in need based upon a contract, before making sure that contract was legal.

On Thursday afternoon, Gov. Corbett released a statement on the decision:

Governor Tom Corbett today issued the following statement on the Attorney General's review of the Lottery Private Management Agreement:

"I'm deeply disappointed. I don't agree with the attorney general's analysis and decision, and we will review our legal options.

My job is to protect Pennsylvania's seniors, and we will continue to do that.

We have a growing population where one in four Pennsylvanians will be over the age of 65 by 2017. My goal is to ensure that funding for senior programs keeps pace with that growth," the governor said.