SPRINGFIELD - A new federal legal decision could put a serious dent in Illinois' effort to raise money for a statewide construction program.

Reacting to a plan by Indiana to privatize the Hoosier Lottery, the U.S. Department of Justice said states may contract with private management firms to operate their lotteries, but that the state must maintain control over significant business decisions made by the lottery.

Illinois officials, who have struggled to find an agreement on how to pay for a road, bridge and school building program, are unsure if the opinion will scuttle the lottery lease idea.

In September, the Illinois House approved a lottery lease plan aimed at generating $10 billion for a job-creating construction program after other funding ideas such as an expansion of gambling failed to gain traction in the Legislature.

The measure is pending in the Senate, which had earlier approved a different privatization proposal.

Lucio Guerrero, a spokesman for Gov. Rod Blagojevich, said the Department of Justice opinion is under review.

Guerrero suggested Sunday that Illinois' proposal is different than Indiana's, which could allow it to go forward despite the federal opinion.

"Suffice to say, we are reviewing and still consider it an option," Guerrero said.

A spokesman for House Speaker Michael Madigan said the federal opinion is a cause for concern, especially in light of the governor's numerous legal battles on other policy initiatives.

"We don't want to be embroiled in another costly lawsuit," Brown said.

Brown said the federal decision could be used as a template to design a lottery lease plan that complies with federal law.

"It is certainly something that should be reviewed," Brown said.

State Sen. Jeff Schoenberg, D-Evanston, who sponsored the Senate version of the lottery lease, said the decision could provide a template for lawmakers to redraft the proposal that would comply with federal rules.

But, he said the changes could result in a different relationship between the state and private business, resulting in less revenue for the state. What's more, the recent economic turmoil could drive down the price private companies are willing to pay to take over all or part of the lottery.

"The landscape has changed dramatically," Schoenberg said.

Illinois and Indiana are among a handful of states investigating a lottery lease as a way to generate dollars for programs without raising taxes. Others include: California, New Jersey, Colorado, Florida, Michigan, Texas and New York.

The lottery lease plan emerged as a frontrunner in the race to find a funding stream for a construction program after other ideas, including an expansion of gambling, did not receive significant support among lawmakers.

If approved, the House plan initially would bring the state $6 billion, followed by $4 billion within the next two years. Some money would be set aside to replace money the lottery usually provides for schools.