Gaming equipment giant International Game Technology earned seven-year contract to provide the management software and equipment for the state’s lottery, which is expected to launch in December.
Mississippi was one of six states that didn’t have a lottery until lawmakers and the governor signed off on legislation in August 2018. The change leaves only Alabama, Alaska, Hawaii, Nevada and Utah without a lottery.
Proponents tried for years to legalize a state lottery, only to be rejected by lawmakers and the state’s casino industry. However, faced with mounting pressure to address the state’s deteriorating roads and bridges, lawmakers approved a bill to establish a state-sponsored lottery in a special legislative session.
However, its taken a year to form the lottery commission, draft rules governing the activity, and selected an equipment vendor.
According to a statement from IGT, the company will provide the Mississippi Lottery Corp. with a central system, lottery terminals, and additional services. IGT signed a separate seven-year contract to supply the production of instant tickets, secure warehousing, and distribution of games.
Financial terms were not disclosed.
IGT’s lottery business, which was part of GTECH Holdings when the company merged with IGT in 2015 in a $6.5 billion deal, has launched 10 state lotteries since 1990.
“IGT will leverage our decades of experience and industry insights to help drive the success of the Mississippi Lottery Corporation, and to introduce compelling lottery entertainment throughout the State,” IGT COO of Lottery Jay Gendron said in a statement.
IGT was selected as the preferred bidder for both contracts following the state’s competitive procurement process. The two contracts allow for up to three one-year extensions. The company will also provide marketing support, field services, primary and back up data centers, call center operations, software support, and retailer training.
Tom Shaheen, president of the Mississippi Lottery Corp., said having IGT on board will help “in our effort as we pursue our mission of raising funds for roads and bridges throughout Mississippi.”
IGT has had a corporate presence in Mississippi since 1992 through its casino equipment operations, helping open the state’s first casino. The company expects to hire additional lottery employees in the state and will open a local office and a warehouse in Jackson, Mississippi near the Mississippi Lottery Corp. headquarters.
Lawmakers expect Mississippi’s lottery to generate $40 million in state tax revenue in the first year; then $80 million to $100 million a year thereafter. The first $80 million of lottery proceeds will go toward infrastructure improvements with any revenue above that amount pledged to education.
Mississippi’s law prohibits slot machine-like video lottery terminals, a concession to the state’s coastal casinos.
The state expects to join multi-state lottery games such as Powerball, sometime in 2020.
Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at hstutz@cdcgamingreports.com. Follow @howardstutz on Twitter.
