Legislators looking into lottery perks

Tom Sharp

Friday, July 23, 2004 | 9:40 a.m.

NASHVILLE, Tenn. -- The perception that the Tennessee lottery is too generous with pay and benefits, especially to top managers, got a thorough airing before the Legislature's Fiscal Review Committee last week.

The joint committee grilled four Lottery Corp. board members and top executives for nearly four hours last week, focusing on the pay and benefits provided in the lottery's early months to CEO Rebecca Paul and other executives of the quasi-governmental corporation.

Board Chairman Denny Bottorff fielded most of the questions. His general rebuttal was that the lottery, unlike most enterprises, could quantify significant financial losses for every day it was not operating -- an estimated $670,000 per day -- creating an immense pressure for bonuses and other perquisites if they could be shown to get the lottery up and running even a day early.

Bottorff acknowledged that mistakes were made. In particular, he pointed to a generous vacation and sick leave policy that was rescinded almost immediately.

"I don't know if any of you have ever been through an experience where so many things happened so fast, but I'll tell you we felt at times like we had a fire hose in our mouth," Bottorff told the committee. "It was coming at us fast and hard."

The committee members seemed generally pleased with the safeguards the board has in place against the kind of lavish behavior that eventually unseated former University of Tennessee President John Shumaker last summer, but it was clear some of the board's expenditures still rankled.