The D.C. Lottery Board, under intense pressure from Mayor Marion Barry to resolve the court fight over the lucrative daily numbers contract, relented yesterday and voted to ask a Superior Court judge this morning to allow it to resolicit bids.
Board chairman Brant Coopersmith said the board made the decision on a 4-to-0 vote in a private room in the District Building after an emergency three-hour meeting yesterday with the mayor, one of his deputy mayors, Ivanhoe Donaldson, City Administrator Elijah Rogers and Corporation Counsel Judith W. Rogers. Coopersmith said the quasi-independent board took the vote knowing that "the city could have asked the court to compel us to resolicit."
Another person who attended the meeting said that Barry "threatened to fire us all" if they did not agree to resolicit bids for what could be a contract worth $4 million to the winning firm based on anticipated annual wagering of $100 million.
One source said Barry stressed to the board members that if they continued the court fight the agency "would be jeopardizing" minority involvement in the city by risking the possibility of a court decision that could weaken a provision of D.C. law requiring that minorities receive 25 percent of the value from all District government contracts.
Coopersmith said that contingent on the approval of D.C. Superior Court Judge Richard S. Salzman, the board would resolicit bids within a week.
But Coopersmith said the latest delay in awarding a contract would push the start of the daily numbers game back from July 18 until sometime in October, costing the cash-short city government more than $7 million in revenue.
Barry was not available for comment after the meeting. But previously he has complained that the city is not in control of the dispute as long as it is in court, and that the city needs the lottery revenues as soon as possible.
Barry two years ago appointed the five-member lottery board, and the members serve terms of various lengths. It is not known exactly how he could fire all of them, if he decided to.
Neal A. Jackson, a lawyer representing Lottery Technology Enterprises, the firm selected by the lottery agency over two other bidders in March to operate the daily numbers game, said last night that his client would fight in court to keep the contract.
"Our position is that the board lawfully selected us as the contract recipient and we are entitled to sign as soon as the court proceeding is concluded favorably to us," Jackson said.
The lottery board on Friday asked for and won a delay in the scheduled start of a hearing sought by the two losing bidders, Columbia Gaming Services Inc. and D.C. Data Co., on whether Salzman should impose a preliminary injunction against the lottery board to prohibit it from signing the contract with Lottery Technology.
However, in the interim Salzman extended his previously issued temporary restraining order blocking the contract signing at least through May 13, the second such restraining order imposed on the board.
Coopersmith said that "while I'm confident in what the board did in previously awarding the contract , it doesn't make sense to continue the trial."
He predicted that the lottery agency would again award the contract, after receiving the new bids, within four to five weeks.
"I'm reluctantly agreeing to resolicit," he said after the meeting. "It would take longer in court" to resolve the fight over the current contract, he said.
The dispute centers on the extent and validity of the minority representation that three white-controlled computer firms have promised to local minorities or minority-controlled firms. A city contract review committee last month said that the board may not have had enough information about the companies' offers to include minorities in their ventures and could actually be awarding the contract to a "minority shell or front."
Lottery Technology is a joint venture comprised of a Rhode Island-based computer firm, Gaming Systems Corp. and four relatively unknown D.C. minority-owned firms. But both D.C. Data and Columbia Gaming have claimed that Lottery Technology is not actually minority-controlled and that Gaming Systems would exert undue control even though it has promised that 60 percent of the profits made by the joint venture would go to the minority firms.
Lottery Technology officials have disputed the claims made by the two losing bidders.
Coopersmith said that in rewriting the bid solicitations, the board will likely make certain that all bidders know they must disclose how much revenue will actually flow to the minorities, not just profits.
The board chairman said the agency also will now have Corporation Counsel Rogers or someone from her office represent the board in court and in helping draft the new bid solicitation. Barry had objected that the board members hired David P. Towey of the prestigious firm of Arnold & Porter to represent it when the panel did not agree with the advice Rogers' office was giving the agency.
Coopersmith said that he, along with board members Lillian Wiggins, Carolyn Lewis and Almore Dale, voted to resolicit the bids. Board member Jerry Cooper also attended the meeting, but had to leave for another meeting before the vote.