By Jason Tolbert
Special to the Arkansas News Bureau

Most of the great advice my dad gave me growing up was offered while we were working on projects around the house. Every time we would cut anything he would tell me, “Measure twice, cut once.” I often would be in hurry to get on to something else and would roll my eyes, but looking back I don’t remember making many mistakes while cutting a board.

Perhaps the Arkansas Lottery Commission should take that advice.

From the beginning, director Ernie Passailaigue has been clear that his chief objective is to get the lottery up and running as soon as possible. “What we have to do is build out a business in a very short amount of time,” Passailaigue told the Political Animals Club in Little Rock on July 21. He said the lottery was not scheduled to begin until 2010, but his goal is to have tickets sales begin on Oct. 29.

In the rush to get started, officials have made a series of missteps that may be undermining the public’s long-term confidence in the lottery.

Passailaigue’s accession to the lottery can be traced all the way back to February when he advised lawmakers on drafting the legislation that created it. These legislators were smitten with Passailaigue. One senator commented that she hoped the Arkansas Lottery could get someone just like him to be the director.

In May, Passailaigue made another trip to Arkansas from South Carolina, this time to advise the new Lottery Commission on how to get started. The commissioners also caught the Ernie P bug. One commissioner commented that finding Passailaigue was “like finding a four-leaf clover” and saw no reason to interview additional candidates.

In June, Passailaigue was offered and accepted the job as the first director of the Arkansas Lottery at a salary of $324,000. The commission gave him the green light to get the lottery started as soon as possible without much additional direction. Based on two consultations with Passailaigue, Arkansas lawmakers took the gamble that Passailaigue knew best how to build our lottery and went all in with Ernie.

Passailaigue’s first order of business was to speed up the lottery calendar. By his estimates, two extra months of ticket sales will translate into $15 million in additional scholarships. To accomplish this, Passailiague says, he must bring on experienced, talented professionals. In order to attract them, we must offer the big bucks.

Shortly after coming on board, Passailaigue sought to bring two of his colleagues he had worked with on the South Carolina lottery, Ernestine Middleton and David Barden. In a June 13 e-mail, House staffer and former House Speaker Bill Stovall advised Passailaigue that these positions could be filled at salaries ranging from $180,000 to $225,000.

Anything over that will require the approval of the Legislative Oversight Committee, Stovall advised.

On July 1, the Lottery Commission approved Passailaigue’s start-up budget and on July 2, he presented it to the Legislative Oversight Committee for their review. The budget not only listed the salaries of Middleton and Barden as $225,000, but also seven other six-figure salaries.

“It is my intent to hire the best and the brightest people available to ensure the quick start-up and long term success of this lottery,” he said. The review of the budget, including the salaries, was approved with only Sen. Johnny Key, R-Mountain Home, opposed.

There was early grumbling about the high salaries, which came to a head on July 14, when it was announced that Grant County Sheriff Lance Huey (from the same hometown as the lottery commission’s chairman, coincidentally) would be the lottery’s security chief at a salary of $115,644. That drew criticism from Gov. Mike Beebe on down. The following
week, Passailaigue confessed that this salary offer — a $69,000 raise for Huey — was a mistake as he relied on a schedule he got off the Internet instead of his own budget approved on July 2.

The latest news is that the lottery received only one bid on its contract to run its drawing games as two other major vendors were not comfortable with the bidding process put in place by Passailaigue. The lone bidder – Intralot – was the provider for South Carolina. One of the vendors that declined to bid said the process in Arkansas was plagued with problems.

All of these errors and missteps may seem minor in isolation. But taken together, they suggest that the set-up and administration of the lottery has been, to date, sloppy and overly hasty. Even Passailaigue has admitted, “If I was a citizen of Arkansas, I would be scratching my head, too.” Passailaigue often compares the lottery launch to a business startup — but it’s hard to imagine any successful business launched with so many mistake, and even a disregard for the goodwill of its future customers.

Perhaps Passailaigue is correct that starting the lottery early will translate to more scholarships for Arkansans. That’s a fine goal, but it should not come at the expense of public confidence. Why not spend a few extra months to measure twice?

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Jason Tolbert blogs about Arkansas state politics at TheTolbertReport.com. A certified public accountant, he lives in Benton with his wife and sons.