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Lottery's ad contract draws protest

An attorney representing the Ghidotti-Vines partnership has filed a protest of the Office of State Procurement’s award of a five-year, $34.5 million advertising, marketing and public relations contract for the Arkansas Scholarship Lottery to competitor CJRW.

The attorney, Alex Gray, said CJRW failed to disclose in writing its conflict of interest in representing Oaklawn Racing and Gaming, so the lottery’s advertising contract should be awarded to Ghidotti-Vines partnership, which received the second-highest score from the evaluation committee that reviewed proposals from three advertising companies.

CJRW executive Gary Heathcott declined to address the complaint in a written statement to a reporter.

The Ghidotti-Vines partnership includes Ghidotti Communications and Vines Media.

Gray maintained that Oaklawn has acted as “a direct competitor” of the Arkansas Scholarship Lottery, which has identified Oaklawn “as a competitor for disposable income and threat to the success” of the lottery.

Thus, CJRW’s representation of Oaklawn is a conflict of interest to its representation of the lottery, Gray said in a four-page letter dated Wednesday to Edward Armstrong, director of the Office of State Procurement, and Lottery Director Bishop Woosley.

“CJRW never disclosed in writing any conflicts of interest in its response to the RFQ [request for qualifications]” for the advertising, marketing and public relations contract, Gray wrote.

“Therefore, because CJRW was required by Section 2.5 H. of the RFQ to disclose in writing any existing or potential conflict of interest and because it failed to do so, CJRW’s response to the RFQ must be disqualified pursuant to Section 1.5 B.”

In his statement to a reporter, Heathcott said, “At the outset of the oral presentations, the competing ad agencies were specifically instructed by [Office of State Procurement] personnel that it was absolutely against the rules for us or any representatives of our firms to discuss any element of the process with any members of the press until after the award and subsequent contract approval.

“We have followed that rule completely and will continue to do so,” Heathcott said in a written statement.

Asked why the procurement office awarded the contract to CJRW if Oaklawn Park is considered a competitor of the lottery, state Department of Finance and Administration spokesman Jake Bleed, said, “We’ve received a protest, and the state procurement director, Ed Armstrong, will provide a determination of that protest at the appropriate time.

“He has not yet completed his determination and until he does, it’d be inappropriate for us to comment on it,” Bleed said in a written statement.

Ghidotti President Natalie Ghidotti told the Arkansas Democrat-Gazette on Dec. 6 that she did not plan to file a protest.

But Thursday, Ghidotti said in a written statement that “I wasn’t planning on protesting AT THAT TIME.

“Once we received the score sheets from DFA and found numerous miscalculations throughout all three finalist sheets, we decided it deserved a deeper look,” she wrote.

Gray is a partner with the law firm of Steel, Wright, Gray & Hutchinson. His law partners include Sen. Jeremy Hutchinson, R-Little Rock, who is a nephew of Gov. Asa Hutchinson.

Jeremy Hutchinson said Thursday that he is not involved in the protest “at all.”

Mangan Holcomb Partners President Sharon Vogelphol said Thursday that she hasn’t filed a protest over the advertising contract, but she could before the Dec. 20 deadline.

“We are still in the consideration stage,” she said, and the firm is focused on its work for the lottery under its existing contract.

Vogelphol said she agreed with Gray in that a conflict of interest exists with CJRW representing Oaklawn Racing and Gaming, which is named as the lottery’s No. 1 competitor in the five-year business plan of lottery consultant Camelot.

Oaklawn General Manager Eric Jackson of Little Rock could not be reached for comment by telephone on Thursday afternoon.

CJRW currently holds the contract with the state Department of Parks and Tourism. That account, worth about $15 million a year, will be open for bids in March.

Business on 12/16/2016

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