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North Carolina lottery
The nine-member commission appointed to run North Carolina's lottery will be among the most independent of any such agencies in the country.
Modeled on similar groups in South Carolina, Georgia and New Mexico, it will be insulated from intrusion by elected officials and will have the power to appoint its own director and decide what games and prizes will be offered.
And though there will be regular oversight of the group - particularly during the state's biennial budget process - North Carolina's lottery commission will be relatively unfettered compared to agencies in Tennessee or Virginia in which the elected officials have a more direct hand in the lottery's operations.
That makes decisions on whom to appoint to the commission by Gov. Mike Easley and legislative leaders all the more critical, say lottery experts from around the country and observers in North Carolina. Many observers expect those appointments to be made this week.
"We want to make sure the lottery is run squeaky-clean", said Gilliam Cobbs, a former public school principal describing his role on the board that oversees Virginia's lottery.
Like North Carolina's future board, Virginia's sets some of the policies surrounding the lottery. But Virginia's law specifically prohibits the board from over-ruling its director's administrative decisions.
And it is Virginia's governor who has the power to hire and fire the lottery director, not the commission, as in North Carolina.
"Our powers are mainly advisory", Cobbs said. "Having the governor play an active role has helped Virginia develop a game with a reputation for being well-run and scandal-free", Cobbs said.
Cobbs was appointed in 2004 by Gov. Mark Warner and is something of an oddity in lottery circles: a board member who was a critic of the lottery.
Before his appointment, Cobbs complained that the lottery was focusing its advertising in poorer and minority neighbourhoods.
Cobbs said appointing lottery critics could be important in bolstering the public faith in the state-run game. Other lottery critics have made similar suggestions, such as having an advocate from one of the state's public-interest advocacy groups that opposed the lottery sit on board.
"I would think that would be a fairly uncomfortable position", said Bob Rosser, a consultant for Citizens United Against the Lottery, a group that lobbied against the game's passage.
Rosser said his group was considering a lawsuit to challenge the legality of the lottery, based on the legislative procedures used to put it in place.
A lottery critic, Rosser said, Players might become frustrated and so he constantly outvoted rather than being able to help impose restraint on the game.
While there is no role set aside for a lottery critic, three of the nine seats do have specific requirements.
One of Gov. Mike Easley's five appointments must be someone with at least five years' experience in law enforcement. Of the four other members to be appointed by legislative leaders, one must be a certified public accountant and another must have experience managing a retail store.
North Carolina's lottery law also says the nine members should represent a cross-section of the state's geographic regions and a cross-section of age, gender, ethnic and racial composition. But it doesn't specify how to do this.
Nor does the lottery law specify how members might be removed for misconduct, a power specifically given to governors in several lottery states, including Tennessee. In Virginia, the members "serve at the pleasure of the governor", giving him even tighter reins over the board.
Aside from the specific requirements laid down by North Carolina's lottery law, officials in states with commissions set up similar to North Carolina's say it is important each member of the group are business savvy.
"You would look for someone with a broad-based business background", said Tom Shaheen, the CEO of New Mexico's lottery and the president of the North American Association of State and Provincial Lotteries, an industry trade group. "You have to run a lottery like a business".
North Carolina's lottery businesses is projected to have at least $1 billion in annual revenue and will be charged with returning no less than 35 percent of that to the state to help bolster spending on the public schools and community colleges.
"Unfortunately, there's not going to be much oversight over that particular part of it, either", Rosser said.
The commission will only be responsible for turning over money to the state, not monitoring that the proceeds are actually helping increase spending on education.
The lottery board's closest scrutiny will come during the state's budget process, when its budget must be approved by the legislature. Also, the state auditor's office is empowered to conduct regular inspections of the games books.
But no system of governance ensures that a game will be problem-free. For example, in Texas the governor has a fairly strong hand over lottery appointments and director. Still, this summer, the lottery's director resigned weeks after approving advertising jackpots that were higher than ticket sales could support.
Critics say lottery commissioners are not designed to be watchdogs, but to help bring in revenue. That won't change with the appointment of North Carolina's board, they said.
"Their job is to get as much money out of the people of North Carolina as possible", Rosser said.
Source: BonusGambler.com Editors' Choice
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