Connecticut Lottery Takes Money from Minority Community But Does Not Buy From Minority Businesses

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According to the Greater New England Minority Supplier Development Council (GNEMSDC), the Connecticut Lottery Corporation (CLC) generates a substantial proportion of its revenues from minority and poor communities throughout the State of Connecticut, but does not buy many goods or services from minority businesses in the state. The GNEMSDC wants the Connecticut Lottery Corporation to establish firm procurement goals for certified minority businesses and for the State of Connecticut to allocate money from the CLC to go specifically for minority business and community development.

GNEMSDC Billboard on the Connecticut Lottery

"State Lotteries have been shown to rely heavily on minority and low income communities, yet they contribute little to the improvement of those communities." Dr. Fred McKinney, President and CEO, GNEMSDC

The Connecticut Lottery Corporation (CLC), a $900 million per year operation that returns $275 million to the state has done an excellent job at extracting resources from minorities, but has done an abysmal job at contributing to the economic health of minority communities in the state, the Greater New England Minority Supplier Development Council said today.

In 2010, the CLC awarded only 16 contracts totaling less than $20,000 to minority-owned businesses while 98 contracts totaling more than $217,000 were awarded to white women owned enterprises. Academic research consistently shows that state lotteries are regressive forms of taxation and that a disproportionate amount of lottery revenues come from African American, Hispanic and Asian communities. Having the amount of resources extracted from minority communities without a commensurate amount going back into under developed communities in the form of MBE contracts is a reason to demand immediate and fundamental change in the CT State Lottery.

“Because of the paucity of MBE contracts let by the CLC, the GNEMSDC is engaging in a marketing campaign of our own, asking the minority community and other fair minded people to consider where their money is going and what is being done with it when they play these games,” said Dr. Fred McKinney, President and CEO of the Greater New England Minority Supplier Development Council.

The GNEMSDC has purchased two billboards in the Hartford area that state: “They want our money, but does not want our business. Why won’t the CT Lottery spend on Minority Business Development?” Dr. McKinney said more billboards are being planned for around the state.

The cost of operating the CLC is about $50 million, with a large share going for marketing, advertising, printing and courier services. Academic literature shows that disproportionate numbers of ethnic and racial minorities and the poor play state lottery games. It is ironic and sad that the CLC does not utilize the services of minority advertising and marketing companies to reach their core clientele.

“We are demanding immediate action by the CLC to increase the utilization of MBEs in all of the types of goods and services they purchase. This needs to be done immediately,” McKinney said.

The incoming Malloy Administration, the Connecticut General Assembly, and the CLC need to consider the following changes:

1)     Changing the CT Lottery Board of Directors so that minority business and community interest are directly represented;
2)    Changing the CT Lottery Leadership and Management so that it reflects the entire CT population and in particular the communities where they receive their revenues;
3)    Establishment of hard goals to utilize and develop MBEs to supply goods and services to the CT Lottery;
4)    Establishing a line item so that at least 10 percent of the funds provided to the State of Connecticut from the CLC are spent specifically for minority business development; and
5)    Establishing a line item like the State of Georgia so that CLC revenues fund college scholarships for inner city and minority high school graduates.

Without these changes, the GNEMSDC will continue to bring attention to the role the CT Lottery plays in contributing to the destruction of minority communities around the state.

The Greater New England Minority Supplier Development Council is a 501 c-3 membership organization whose mission is to significantly grow minority businesses in the region by building relationships with Corporate America and the public sector. The GNEMSDC is a regional affiliate of the National Minority Supplier Development Council. The GNEMSDC serves over 200 corporate members and over 400 certified Minority Business Enterprises in Maine, New Hampshire, Vermont, Rhode Island, Massachusetts and Connecticut. Last year NMSDC corporate members purchased over $100 billion in goods and services from NMSDC certified MBEs.


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