A Four Part Series
- Part 1 - June 6, 2006 - About Director Sadberry and
the SAO Security Report , Click Here
- Part 2 - June 7, 2006 - Are the TLC Employees Happy
Now? - Click Here
- Part 3 - June 15, 2006 - SAO Reports, About the Integrity
of our Games, Scratch Tickets, Plus Much More ... Click Here
Part 4 - In Memory of Mark Bradshaw - Click here

Read about the TLC employees ... Click here and read Oct 9th entry.
See and hear what our legislators were told about VLT's, Click Here.

Oct 10, 2008 - 12:30 PM - Opinions Expressed Here Are MINE ... (Dawn Nettles)

Well, it's been a while since I wrote anything on my Hodgepodge page. There are reasons but there's no since in me going into that right now. Let's just move on with a few things I want to say. Today I'm going to cover two items - the new lottery commissioner and the purchase of Directors & Officers (D&O) insurance at the expense of taxpayer money.

About the new Lottery Commissioner ...

This week Governor Perry appointed a new commissioner to the Texas Lottery. Her name is Mary Ann Williamson.

I've often wondered how the Governor picks the people that he does to serve on Commissions so this time I decided to find out a little bit about her to see if I could try figure it out. I did this because I know a couple of people who submitted applications to serve as Commissioners yet they haven't ever be chosen by the Governor. Based on the "connections" that I found with Ms. Williamson, I think I may have figured it out. At least, this is my opinion!

The first thing you - as readers - need to know, is that the "Commissioners" really run the agencies. Governor Perry has been in office so long now that almost all Commissioners have been appointed by him. He can rest assured that the work he wants done can be accomplished by appointing certain folks to each of the agencies.

So let's look at the "ties" between the Governor, the Texas Lottery, Ms. Williamson, good friend Dan Shelley and the golden opportunity of taking MONEY from those who can least afford it.

Ms. Williamson's husband was Ric Williamson who died in January of this year. Mr. Williamson spent 14 years representing Parker and Wise counties in the Texas Legislature. In 1998, he decided not to run again.

In 2001, Governor Perry appointed Mr. Williamson to the Texas Transportation Commission where he "convinced" other leaders that it would require radically different steps to build enough roads to keep up with Texas' explosive growth. The Governors motive - the Trans-Texas Corridor issue - The Cintra deal that the Governor pushed. He's got the right man in the right spot.

Some of Mr. Williamson's closest friends were Governor Perry - who spoke at his funeral - and another state representative/senator/lobbyist/legislative aide by the name of Dan Shelley.

Mr. Shelley served as a state rep and senator from Houston for 8 years. He is now a high paid lobbyist and has had the privilege of working for Governor Perry as a legislative aide in "special times of need" - in otherwords, to conduct his lobbyist work for Cintra. As the FreeRepublic put it, "Cintra consultant turned Governor Perry's legislative aide, turned Cintra lobbyist. It's hard to keep up with who is working for who. Or is it? Austin lobbyist Dan Shelley has been one of Governor Perry's aides and Cintra's inside men. Shelley worked for Cintra making introductions to TxDOT just in time to see them get a winning proposal submitted for the Trans Texas Corridor. Then he worked for Governor Perry just in time to lobby the Legislature to protect and strengthen laws benefiting Cintra. Now he's back working for Cintra again planning all expense paid trips to Canada for TxDOT and Texas law makers."

Now that you see the ties between these three men, you're asking, what does this have to do with the Texas Lottery. The answer is PLENTY!

You see, Mr. Shelley is also a lobbyist for Aces Wired - the very company the TLC has been wanting to do business with. Aces Wired, Inc., is an operator of amusement gaming centers and a licensed distributor of bingo supplies and equipment. The Texas Lottery has been trying to sneak through "video confirmation" for a long time now.

It is also important to tell you that in May 2008, the AG shut down Aces’ locations in Dallas, Fort Worth, Corpus Christi, San Antonio and Copperas Cove and is the process of investigating the legality of the Company’s amusement with price (AWP) machines.

It's important to note, Mr. Shelley's son-in-law also represents gambling interests as a lobbyist too.

Folks, it is my opinion, that Governor Perry is really in favor of expanded gambling and always has been. And he's not alone. Representative Kino Flores is really in favor of it too. He keeps pushing legislation that hasn't passed.

While many of you believe "we should keep the money in Texas" - ya'll don't really understand the full impact of having "VLT's," "video gambling," and casino's in Texas. Other states that approved expanded gambling are regretting that move. The social costs were more than the profits - the states saw no profits.

Right now, the TLC is busy convincing the Texas Legislature and the media that lottery sales are down because players are "tired of the games" which is a bunch of crap. They are telling the legislature that we need to expand gambling. FYI - Lottery sales are NOT down because of the economy nor are sales down because of the cost of gas.

We, the players, KNOW why we are NOT supporting the games of Texas. And we've taken our valuable time in the past to tell the Texas Lottery but it fell on DEAF ears. The decisions staff and commissioners made screwed the state out of a lot of money and I told them so at the time they did it. And it's on the record.

Did you know that 35 out of 42 state lotteries have seen increased sales this year. You see, people spend more money gambling in hard times than they normally do but NOT in TEXAS. Just so that you know, I will be posting FULL details about Texas lottery sales in the coming days.

Back to Mrs. Williamson - the new lottery Commissioner. I think you see that by appointing her to the Texas Lottery Commission that Governor Perry's friends, Mr. Shelley and Ms. Williamson can hopefully work together with inside info to complete whatever tasks he wants done. Both Mr. Shelley and Ms. Williamson stand to make a lot of money if their is "mission" is completed!

This is much like Governor Perry appointing Commissioner Cox to the Commission. Shortly after he was appointed is when we saw the Las Vegas Law Firm who was hired to write Texas legislation which is against the law. Both the TLC & AG got into a lot of trouble for this and "supposedly," the law firm was not paid all monies that they had billed to the state of Texas. The law firm was also lobbying Texas for casinos. FYI - Commissioner Cox had casino ties when he was appointed to the Commission. It has become obvious to me though that Commissioner Cox does NOT know how to run a successful lottery or he wouldn't have voted the way he did on several game changes that has ultimately cost the state of Texas a ton of money for the school children of Texas.

This is MY opinion and only time will tell regarding the appointment of Ms. Williamson to the Texas Lottery Commission. I will be watching her every move.

Next subject ... The Purchase of Directors & Officers Liability Insurance (D & O Insurance) ...

On Feb 1, 2008, the Texas Lottery purchased what's called a D & O insurance policy. The purpose of purchasing D & O insurance is to cover judgments, settlements and defense costs for Commissioners and/or staff members who may be sued.

And YES, this is before the Shelton Charles settlement where the TLC claim he settled for $58K and his attorney settled for $40K. So that you know, Shelton Charles case was a federal case and he sued Gary Grief as well as the Texas Lottery.

The limit of liability is $1 million and the cost to the state for this policy was $25,887. The deductible is $100K.

On August 18, I made an open records request to obtain a "copy of the policy, all declarations, endorsements, amendments, attachments and appendices."

On or about Sept 9, 2008, I received a letter from the TLC stating "enclosed are documents responsive to your request." What they had enclosed was a BINDER. Folks, a "binder" is what insurance companies give clients for confirmation that the client has insurance - it is NOT a policy.

On Friday, Sept 19, 2008, I contacted the TLC and told them that they had NOT provided documents responsive to my request and I would appreciate receiving what I had originally requested. They would have received this notice on Sept 22, 2008.

Yesterday, Oct 9, 2008, I received an email that said, "With reference to your request, the State Office of Risk Management (SORM) procures the D&O insurance for the State of Texas and individual agencies may elect to purchase the insurance under the global SORM procurement At the time of your request no policy had been received by SORM or the Texas Lottery Commission and the binder was the only document available."

There are THREE points I want to make.

First, can you imagine paying $25K to Illinois National Insurance Company for insurance and 9 months later you still don't have your policy? Talk about bad business.

Second point - by state law, the TLC has 10 working days to respond to an open records request. They took 14 working days to give me a VAGUE answer and I still don't have documents responsive to a request I originally made on August 18, 2008. They say they have no policy.

Third point - how much taxpayer money is being wasted by the state to purchase such insurance policies? Do our legislators not have faith that they are placing People in positions that will do employees/consumers fairly and with the best interest of the state in mind without causing lawsuits?

I found it most interesting to learn that Commission Clowe, a former lottery Commissioner who was recently appointed to the Department of Public Safety Commission, has just purchased D & O insurance for that agency as well. Hmmm ... Think this is because of the $900K the state lost in the lawsuit by one of Governor Perry's security detail guys that worked for the Dept of Public Safety?

That's it for today. I will be posting a FY08 sales story for ya'll next.