2005 a trying year for Texas Lottery chairman

Jan 2, 2006, 7:42 am (3 comments)

Texas Lottery

Tom Clowe says he was never much of a gambling man, but he was willing to take his chances when he asked Gov. George W. Bush in 1998 to give him an opportunity to serve the state in a volunteer capacity.

"I said to Governor Bush: ‘I'm ready to do public service now. Give me the worst job that you've got,' " Clowe recalled in a recent interview. "And, man, he did!"

Bush appointed Clowe in November 1998 to the board that oversees the Texas Lottery Commission, which was still reeling from a string of scandals that caused two of its executive directors to be fired within six months and prompted officials to consider voiding the contract of the lottery's prime operator.
Compounding those problems was a dramatic drop-off in ticket sales, which meant that the state was realizing far less revenue from the lottery than lawmakers had counted on.

Clowe, a one-time Air Force pilot and former president of the Central Freight Lines trucking company, said he viewed those controversies and myriad others that he would encounter after being promoted to lottery chairman in March 2000 as nothing more than opportunities to fix problems for the state.

"I love challenges and I love to solve problems," said Clowe, 72, who has retired from the trucking and energy-distribution businesses. "You get a full dose of that here."

Much of 2005 has been a case study in crisis management at the Lottery Commission, which operates a $3.5 billion-a-year business that generates about $1 billion in profits annually for the state's public schools.

In early June, Clowe learned from a reporter that top lottery officials had inflated the advertised jackpot for the Lotto Texas game several times to mask slumping ticket sales. He made no effort to hide his disappointment and publicly upbraided then-lottery director Reagan Greer, saying the action had threatened to undermine the integrity of the state agency.

Greer resigned a month later, saying it was clear that he had lost the confidence of Clowe and the other lottery commissioners.

Meanwhile, several former lottery workers complained to lawmakers and others that they had been threatened on the job and fired without cause. They included the head of the agency's financial administration, who blew the whistle on the jackpot inflation.

In addition, another employee accused agency officials of failing to make lottery's disaster recovery center, designed to handle business operations in the event of a natural calamity or terrorist attack, fully operational despite spending millions on the project. That employee was fired after taking his allegations public, and lottery officials have adamantly disputed them.

And the lottery continued to struggle with low ticket sales and is considering overhauling the Lotto Texas game for the third time in five years.

Clowe says he is unfazed by such setbacks.

"This has been a challenging year, but I'm not sure if it's any more than some of the others that I've gone through," he said, pointing out that the lottery has consistently turned a $1 billion-a-year profit for the state.

"I think that operation of legalized gaming in the state of Texas will always be controversial and full of conflict. ... We're not stamping out license plates here. We're printing dollars; we're printing money. Anything that happens here is going to get a lot of attention."

Longtime associates said Clowe has a rare combination of people skills and a business executive's tenacity that will keep the lottery on sound footing.

"He is totally and completely ethical in everything he does, whether it's business or government," said former state Comptroller John Sharp, who as a member of the Texas Railroad Commission in the late 1980s was instrumental in hiring Clowe as that agency's first executive director and still considers him a good friend. "The lottery is always going to be in the hot seat, so he's the perfect guy to oversee it."
Clowe was born in Ardmore, Okla., grew up in Dallas and eventually settled in Waco after living in several Texas cities.

He said that when he left the Air Force as a young pilot he went searching for job that would require him to work hard but give him the opportunity "to make a lot of money."

That journey started from behind the wheel of big rig for a trucking company. He quickly moved into management and developed a philosophy based on that of Southwest Airlines co-founder Herb Kelleher: that a motivated work force would pave the way for a profitable company.

His career in business has included stints in the top management of several trucking firms, including Central Freight Lines, where he became president, board chairman and chief executive. He also managed or ran several energy-distribution companies. He interrupted his career to spend three years at the Railroad Commission, which regulates the Texas energy industry, first as a division manager and finally as executive director.

That experience, he said, sharpened his appreciation for public service and prompted him to approach Bush for an appointed post in state government. Being tapped for the Lottery Commission caught him off-guard, recalled Clowe, who said he had no interest in gambling and could not even remember if he had voted for or against the establishment of a state lottery in the 1991 election.

"I said: ‘I don't know anything about gaming. I'm a trucker and a gas-distribution guy,' " Clowe said. "He said: ‘That's what I want. I want somebody with a ... head for business.' "

Clowe, who despite operations on both knees still runs five miles in about 50 minutes a few times a week, said he spends three or four days each week at the Lottery Commission's headquarters in Austin, picking the brains of the executive staff and line workers. He said he doesn't try to micromanage the agency, just to motivate the work force and to show appreciation for the job employees do.

Lottery critic Dawn Nettles of Garland said that if Clowe wants a happy work force, he has a tough task. As publisher of the online Lotto Report and as something of a fixture at the commission's monthly meetings, Nettles has advised several current and former agency employees on how to air their grievances both in the news media and to lawmakers.

"I have nothing but respect for Tom Clowe," said Nettles, who first called public attention to the jackpot inflation scandal and had applied for the job to replace Greer but was passed over. "He truly does have the best interests of the lottery at heart, but unfortunately, he believes everything the senior staff over there tells him."

Clowe called Nettles' unblinking attention and criticism of the agency "a net plus," but he also said that many of the complaints she has aired have been unfounded.

"You always want input from the outside, and you want a citizen who has an interest to be articulate," he said. "But I'd like [the criticism] to be factual."

Clowe's term officially expired in February, but he continues to serve in a "holdover" capacity, which means that Gov. Rick Perry could replace him anytime. Kathy Walt, Perry's press secretary, said he retains full confidence in Clowe's stewardship, saying Clowe has excelled "in one of the toughest jobs in state government."

The open-ended assignment is fine with Clowe, who said he is still hoping to hire someone who can quiet the lottery's distractions to replace Greer. And he'd like to keep pushing to have Texas become the only state to offer both Mega Millions and Powerball, the nation's two multistate games, to its players.

"I serve at the governor's pleasure," Clowe said. "I'm not in any hurry to go anywhere."

Fort Worth Star Telegram

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For a leader and troubleshooter, he managed to allow the lottery to still be one of jokes of the year.  It may have looked good on the surface, but was a distaster at its core.  Non-professionals showed the world that it was corrupt at all levels.  All I would give him credit for is being able to white-wash the problem (for a while), and horrible management skills.  End the corruption, and you get credit.  Hide it, and you get zero credit.  Then again, he made a billion dolars for the state, so they have to love him in Austin.

Rip Snorter

Agree with stupid


If Lotto Texas stops playing their game and go to Powerball, this would be huge for Texas players becoming the only state to have two multi-state games. I hope Texas starts it and then California follows suit by dropping their CA SLP.

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