Mayor Adrian Fenty has agreed to withdraw a controversial $120 million deal that would turn the D.C. Lottery over to a foreign company and a bevy of local investors with questionable pasts.
Chief Financial Officer Natwar Gandhi told the D.C. Council on Wednesday the contract with W2I, a joint-venture of Greek firm Intralot and D.C.-based W2Tech, will be yanked. The contract was unlikely to win approval from the council’s finance and revenue committee, which was reviewing it.
“We are having a second look at the whole situation,” Gandhi said. “My recommendation to the mayor at this point is to have a second look at it, and we are withdrawing it.”
The D.C. Lottery operates under the auspices of the CFO, but Gandhi must go through the Fenty administration to submit legislation, including contracts, to the council.
Ward 2 Councilman Jack Evans, chair of the finance committee, and Ward 1 Councilman Jim Graham, both called on Fenty to spike the lottery deal. Graham in particular cited the brief 9-month-old history of W2Tech, the questionable gaming experience of key local players, and the background of W2Tech’s principal owners.
“I’m very pleased to hear that,” Graham said when told the deal was being withdrawn.
W2Tech, the majority partner in the joint venture, is led by Warren C. Williams Jr. and Sr., both of whom have checkered pasts with regard to the District’s real estate and social scenes. Williams Sr. owned Club U, once a nightclub in the Reeves Center where a man was fatally stabbed three years ago. Williams Jr. has been called a “slum lord” by city officials.
On Monday, Graham asked why the District would turn over an “extremely valuable contract” to the owner of an establishment “with a pattern of violent events.”
Proponents of the deal said W2I proposed to modernize the lottery and its technical capabilities at a significantly lower cost than what current contractor LTE is charging — $6 million versus $11 million a year.
Before the contract was pulled, it was described as “a win-win for the District of Columbiain terms of technical superiority and cost savings,” by Eric Payne, director of the CFO’s Office of Contracts.
