The Ohio Lottery Commission has formally rejected State Auditor Mary Taylor's decision to launch a performance audit of the $2.4 billion agency without its blessing.
Lottery Director Kathleen Burke said in a letter Saturday that the audit "does not seem reasonable, necessary or a wise investment of public funds."
Taylor's office notified the commission last week that it was beginning a performance audit, citing the uncertain nature of gambling revenue from month to month and an "environment of heightened risk" created by, among other things, the passage of Issue 3, which allows casinos in four Ohio cities.
Burke reiterated many arguments she outlined in an interview Friday with The Plain Dealer that appeared in Sunday's paper, including her contention that the commission's sound financial performance doesn't warrant the attention.
"The fact that the Lottery has generally experienced consistent revenue growth contradicts your statement that gaming revenue from month to month and venue to venue is uncertain and therefore results in additional financial risk," Burke wrote.
Performance audits are typically initiated by a state agency itself, seeking advice on improving operations. Under Ohio law, the auditor or the legislature can call for one on the public's behalf. But this is the first such audit initiated by Taylor against the wishes of an agency that is not in financial trouble. The performance audit — separate from yearly audits of financial statements and regular monitoring of game drawings — will examine staffing, planning and budgeting, games and oversight by the administration, among other things.
Chris Abbruzzese, Taylor's director of public affairs, said Friday that the state's current budget deficit supports the need to make the commission, which pumped $702 million into the state's education budget last year, as efficient as possible.
In an interview Monday afternoon, Abbruzzese said Taylor is more than happy to further explain her intentions to the commission and answer questions about the audit.
"We are state government efficient experts and we follow professional standards and if someone has a unique book of business, like the lottery does, we can customize our plan to account for that," he said. "We intended and expected this to be a collorabative effort and we still we have that expectation."
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One state which desperately needs a full audit, including undercover sting operations performed on retailers, is New York. There was a TV news program which covered undercover stings on retailers in California. A few, not many, retail clerks would check a ticket. Sometimes if the ticket was a winning ticket, the clerk would say it was not a winner and keep the ticket, cashing it later. California has stiff penalties for such acts of fraud. When caught, the clerks are arrested and the retailer would lose its license to sell lottery tickets of all types. In many cases, retailers depend on lottery sales to boast sales for their other merchandise. Losing their ability to sell lottery tickets effectively puts them out of business.
When the TV news program tried to cover this story in New York, the New York lottery commissioner refused to cooperate. In fact, he went so far as to warn retailers that a new story was being made in New York!
There was also another part of the report which covered strange instances of where certain retailers would win $10,000 to $50,000 multiple times. These winners are not customers. They are the actual owners or wives of the owners of the retail stores. I cannot remember which state this occurred in. If anyone remembers, feel free to add to this discussion.
It was Illinois
Looks like somebody got mad from this last story, and ordered an audit:
https://www.lotterypost.com/news/150937
You pump 702 million dollars into the educational fund and there going to look for away to get Joe Citizen to contribnute more.....Politics and Lottery, It's the new big business
I wish someone would do an audit in Tennessee.But I guess that is wishfull thinking.
I think that audits, should be done in all states that have the lottery.
Especially GA. I think it was last year that the CEO's bonus was more than half of her salary.
Astekblue
Since we already know that, what kind of useful information do you expect we'd get by spending hundreds of thousands of dollars on an audit? The purpose of an audit is to look for irregularities, mismanagement, or inefficiency. Bonuses are either tied to rules, legislation or an employent contract, or based on meeting performance goals. The former can be fixed without an audit by simply changing the rules or the terms of renewed employment contracts. The latter probably means that the fat bonuses were based on good sales. That doesn't guarantee that there aren't any problems that could be fixed or improved, but it's certainly not an indicator that somethings's wrong. I think it's a sure bet that one of the things that's wrong with government in general is spending too much money to study problems that don't need as much studying as the government likes to do.
ALL Lotteries should be audited.
As an aside, AUDIT THE FEDERAL RESERVE WHILE YOU ARE AT IT. PS..it ain't Federal and there aren't any reserves.
The boss at the lottery doesn't want her books to be audited, how shocking.
She says it's a waste of money. When has any government agency ever worried about wasting money? All the more reason to audit them. They have a state auditor for one reason - to audit. Let them do their job lady and stay out of the way. If you haven't been cooking the books you've got nothing to worry about, right?
State employees get a bonus? A performance reward? Who decides that and how much?
Yep the highest paying positions are at the lottery and I don't think that's right. Who does the performance evaluation to determine a bonus? I would think it would be para-mutual to be fair to all state employees, or at least those working for the lottery. I think there should be no protest to any local, state or federal audit. That is unless the same company(s) get to do the audits.
The real test will be to see the monies being reserved for annual payouts is preserved and not spent like robbing Peter to pay Paul. Sure would be news to see the lotteries go broke because of poor management like some big bank back east. Looks like the same pattern though, big bonuses, no fiscal accountability and nobody looking over their shoulders. A perfect combination to shake the pig.
I say audit them till they get caught because any objection is a big warning for the state's financial health. Nobody should be nervous about an audit, unless there is something to be nervous about.
And if there is extra dough for a performance award, then a clean audit would guarantee an even bigger bonus for stellar performance. It's a win-win for the the honest lottery division, a loose, loose for the dishonest. Now,... for the promise of an even bigger performance award, I can see no objection to an audit. So,.... what's the problem? They are not confident of their numbers?
DD