Legislative committee refuses to OK lottery ad contract UPDATE | Arkansas Blog

Wednesday, January 18, 2017

Legislative committee refuses to OK lottery ad contract UPDATE

Posted By on Wed, Jan 18, 2017 at 10:17 AM

click to enlarge SEN. JIMMY HICKEY: Leads disapproval of lottery ad contract.
  • SEN. JIMMY HICKEY: Leads disapproval of lottery ad contract.
The review subcommittee of the Joint Budget Committee this morning failed to "review," or approve, the $34.5 million contract with CJRW to take over the Arkansas Lottery's marketing, which had been held by Mangan Holcomb.

I only have word of the vote by the committee whose members include Sen. Jimmy Hickey, who's taken something of a proprietary interest in lottery matters. He helped put in place a consultant, Camelot, that among other things has said that the lottery's main competitor was casino gambling, conducted in Arkansas at Oaklawn Park in Hot Springs and Southland in West Memphis.

I'm seeking more info, but I'm told Hickey led questioning this morning and made the motion against review. It was approved on a voice vote.

Challenges to a change to CJRW were mounted by Mangan and another firm because the process failed to take into account a potential conflict of interest in CJRW's representation of both Oaklawn and the lottery. Those challenges were rejected earlier this month.

What now? That's the great question. The Hutchinson administration has bridled at past legislative efforts to control executive agency contracting. The lottery falls under Hutchinson's Finance and Administration Department these days. There have even been suggestions that the governor might go to court someday to resolve the issue of how absolute legislative review is under terms of a fairly new constitutional amendment that expanded legislative review power. Even in one-party government, things can get interesting. Hickey is also a Republican. CJRW's executives include Gary Heathcott, who handled the governor's campaign advertising. Since Hutchinson took office it has picked up state economic development business and still holds the parks and tourism account.

I'm checking, but I think the full Joint Budget Committee gets next crack at the issue, which today was before its PEER/Review subcommittee.

Kyle Massey of Arkansas Business, who's been covering this like the dew (his background here), said the negative vote came despite an agreement by CJRW to cut its ad placement commission from 15 percent to 13 percent. Bishop Woosley, the lottery director, said that cut would put CJRW in line with Mangan in terms of pay as a percentage of budget.

A spokesman for ADFA said it hasn't decided what the next step will be.

UPDATE: Joint Budget accepted the PEER/Review subcommittee's report that it had not approved the contract. But, by voice vote, it also sent the contract BACK to PEER/Review. Discussion didn't reveal what that was about, but presumably it creates an opportunity for further discussion.

More reporting today from Kyle Massey at Arkansas Business.

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