Chicago Mayor Richard Daley, who announced plans to retire from his post yesterday, is more unpopular than ever thanks in part to a rushed and shortsighted lease of a key city asset: its parking meter system. With the November elections right around the corner, Gov. Pat Quinn and members of the General Assembly should be careful not to fall into a similar trap.

Next Wednesday, the governor will select the winner of a bidding competition to oversee Illinois' lottery system. This process began last year when the state legislature passed a measure into law allowing the Department of Revenue to conduct the lottery through a management agreement with a private company. While the U.S. Department of Justice has ruled that a state must control all significant business decisions made by a lottery enterprise, Illinois will soon become the first state to outsource fully its lottery management and marketing responsibilities. (It will retain ownership and regulatory oversight.)

There's a broad consensus around Springfield that the Illinois Lottery has the capacity to deliver greater revenue than it currently does. Illinois generates about $2 billion annually thanks to its gaming program. Roughly $650 million of that money eventually flows into the state's education honey pot, equaling almost 10 percent of the state's total contribution to schools. Yet lottery sales have remained flat in recent years, Illinois trails other comparable states in lottery sales per capita, and the system's machinery and customer outreach are outdated. It's an asset that's not being utilized wisely, especially at a time when the state's education budget is under constant duress.

Lots of gaming experts have spent time trying to figure out how to add new players to the mix in the 21st century. Bringing the lottery online and to wireless users is one strategy with plenty of support. (Internet lottery sales are still technically illegal, although some observers expect that to change in the near future.) Tapping into the growth of social media will undoubtedly play a role in any new marketing push, as well. Supporters of the privatization measure say that a comprehensive and forward-thinking business plan could boost profits by $150 million per year.

The General Assembly has concluded that a private company is needed to make those necessary changes. The idea is that a corporate manager will be better positioned to take entrepreneurial risks with state money than bureaucrats. "A private manager," Illinois Lottery Acting Superintendent Jodie Winnett told the Public Gaming Research Institute, "will be expected to bring something to the table in this area of prudent and shrewd risk assessment."

Of course, that risk sharing isn't free. The state will likely pay the management company a sizeable fee for its services along with an additional percentage of any increased lottery profits. Already, the state has shelled out $4 million to the Oliver Wyman Group of New York to help select the private manager. If the state could devise its own lottery reorganization plan in-house, none of those payments would be needed. "The purpose of the lottery is to provide funding for the citizens of Illinois," wrote State Rep. Jack Franks (D-Marengo), "not a corporation handpicked by the Governor."

Speaking of the governor, representatives from his office attended a public hearing in Chicago this morning and listened to the bids submitted by two finalists: Northstar Lottery Group, a joint venture between GTECH Corp., Energy/BBDO, and Scientific Games Inc., and Camelot Illinois. Coalition members from the first bidder have been in business with the state for over two decades, supplying Illinois with lottery equipment, instant tickets, and advertising work.

That relationship is leading good government critics to question the validity of the selection process altogether, which they say has been rushed and shrouded in secrecy. Members of the committee reviewing the bids have remained anonymous, for example. The state hasn't even released information about how many bids were ultimately submitted. And one company whose bid was rejected is protesting the decision, claiming they were given no justification for why its entry was tossed aside. "Does [Gov. Quinn] not understand what appearance of impropriety means?" wrote the Daily Herald editorial board yesterday. "Does he not understand that voters in this state want more transparency than is required?"

If Northstar is eventually awarded the lottery contract, Gov. Quinn and his staff need to be wary about the terms of the inevitably complex deal. When Mayor Daley leased his meters, he relied heavily on investment firm William Blair and Co. to write up the contract. Not surprisingly, Blair officials gave themselves and the other representatives from the companies now controlling the city's 36,000 meters a wonderful deal. Chicagoans lost close to $1 billion in future revenue and control over a useful transit development tool as a result. Daley lost support across the city.

Camelot, for what it's worth, released some details about its bid to the public before the meeting this morning. The company says it would limit the games' reliance on low-income residents and award 20 percent of contracts to firms owned by women, minorities, and the disabled. Yesterday, Camelot also mentioned that it plans to set up a foundation and allocate 10 percent of its profits (up to $35 million over 10 years) to Illinois educational programs and organizations. The Chicago Urban League, Illinois Hispanic Chamber of Commerce, and the Women's Business Development Center have all endorsed the bid. Northstar delivered a similar procurement diversity promise this morning and said it would donate 5 percent of its profits to local non-profit organizations.

The governor must decide which company to use by September 15. With the election just weeks away, it's almost certain his choice will face heavy scrutiny.