Lottery system contract for approval suggested for Intralot in Maryland
In a significant development, the Maryland Lottery and Gaming Control Commission has recommended Greek tech company Intralot for the new Lottery Central Monitoring and Control System (LCMCS) contract, over competitors Scientific Games and IGT. Despite Intralot ranking second in terms of technical merit, the Commission's decision appears to be primarily driven by financial considerations and Intralot's commitment to community engagement.
The decision comes after a competitive bidding process, initiated with the announcement of a request for proposals (RFP) on July 19, 2020. A total of three companies, including Scientific Games, IGT, and Intralot, submitted proposals in response.
Financial Considerations ------------------------
Intralot's financial proposal, estimated at $260,393,946, underbid Scientific Games by a substantial amount, reportedly $110 million. This cost advantage likely influenced the Commission's decision, as the total estimated contract term price for Scientific Games' proposal stood at $371.1 million. IGT's proposal, on the other hand, had an estimated total contract term price of $641 million.
Community Engagement and Partnership -------------------------------------
Intralot's approach to community engagement was another key factor in the decision. The company engaged nine local Minority Business Enterprises (MBEs), more than previous vendors have typically partnered with, aligning with the Commission's requirement for MBE participation. This commitment to supporting local communities could potentially enhance the social and economic benefits of the contract.
Competition Evaluation ----------------------
Although Scientific Games ranked first in technical merit and Intralot came second, the evaluation committee confirmed that all three bidders could meet the Maryland Lottery's operational requirements. This suggests that while technical merit was important, it was not the only factor in the decision-making process.
If awarded the contract, Intralot would be responsible for manufacturing the counter terminals and self-service vending machines required for the sale of tickets at over 4,300 Maryland Lottery retail venues across the state. The contract, if approved, would be valid for 10 years with a renewal option for an additional 5 years.
The current LCMCS contract with Scientific Games is set to expire on May 4, 2027. The next step in the process is a green light by the Board of Public Works before the contract can be officially awarded.
Intralot currently powers lotteries in several important markets, including coin-operated amusement machine contracts in Illinois, New Mexico, Washington DC, and Ohio. The company's success in these markets undoubtedly played a role in its competitive bid for the Maryland contract.
[1] Total estimated contract term price for Intralot's proposal. [5] Reported difference in total estimated contract term price between Intralot and Scientific Games.
Sports betting is a potential interest for the Commission as Intralot's financial proposal for the new Lottery Central Monitoring and Control System (LCMCS) contract is estimated at a lower cost compared to Scientific Games, offering a substantial savings of $110 million. The company's commitment to community engagement, such as partnering with nine local Minority Business Enterprises (MBEs), is a significant aspect of their bid, demonstrating their focus on promoting social and economic benefits.
