After Losing Contract, IL Lottery Chief Turns Against Contracting
With a number of ex-governors in prison, it’s difficult for a relatively low-level Illinois public official’s misbehavior to stand out. But the Illinois state lottery director Mike Jones is making a go of it.
According to local sources, after a previous stint as the state’s lottery director, Jones stepped down in an apparent attempt to secure the lucrative state lottery contract, which was going out to bid for private management:
Before this, his second, tenure as Illinois Lottery superintendent, Jones formed a company called ‘Your Lottery LLC’ to pursue the Illinois lottery contract for himself. He was listed by the Huffington Post as one of the top contenders for the contract. When he was interviewed, Jones spoke glowingly of the benefits a private company could bring to the state lottery, which severely lagged behind other states. When Jones withdrew from consideration and lost the contract, he changed his tune. Sources tell Illinois Review that Jones may have tried to contact other bidders, allegedly promising to "help" them get the state contract in exchange for a large chunk of their proceeds. When all of the bidders turned Jones down, Jones decided the process, which wasn't allowing him to get paid according to Illinois "rules of order," he soured on the privatization contract process and began his campaign.
Jones failed to make his lotto scheme pay off, so he went back to work at the Illinois Lottery … and immediately began to malign both the contract bidding process and the corporations that were taking part. He’s also taken his show on the road beyond the Illinois state line to “offer” his unsolicited “advice” to other states considering privatizing their lottery systems. Given the success Illinois has had with its lottery privatization (the state brought in nearly $100 million more this year than in the previous year) one might think Jones would offer high praise for his state as a model for increasing revenues.
Despite Illinois’ success, Jones first made unwelcome visits to Indiana to tell them to avoid privatizing the Illinois way:
The Illinois Lottery is not a model Indiana should follow in seeking a private manager to boost revenue, according to Illinois’ own lottery chief.
“It’s as if they didn’t learn anything,” Illinois Lottery Superintendent Michael Jones said after reviewing the request for bids that Hoosier Lottery released in July.
Indiana utterly ignored Jones and instituted contract bidding system similar to Illinois’ and subsequently awarding a similar private lottery contract to that which Illinois adopted. Outgoing Gov. Mitch Daniels counts the privatization of Indiana’s lottery system as a highlight of his legacy as chief executive of the Hoosier State.
"In eight years, this may be the easiest and most obvious decision the state has had to make," Daniels said in a statement. "With this contract, the only question is how much more money Indiana will receive than under the current system."
Undeterred by his failure to halt Indiana’s successful lottery privatization deal, Jones is now exporting his sage “advice” to Pennsylvania, where, again, the governor is looking to emulate Illinois’ model of success:
“Given the example of Illinois, why would any state opt for the same system?” [IL Lottery Director Mike] Jones said. “[Northstar] was only hired because of its ability to meet revenue targets, but it has immediately disputed those.”
He is trying to get the word out to other states not to lock in such long contracts and to make any privatization a truly competitive process in which the state can fire companies that aren’t performing.
It’d be one thing if Jones were a genuine watchdog of the public fisc. But, as previously stated, the privatization of Illinois’ lottery system has been wildly successful, netting an overstretched state budget an additional $100 million last year. Meanwhile, Jones himself has taken to doling out lucrative contracts to “consultants” with vague job descriptions and no real accountability:
Illinois citizens are struggling to find jobs, but the Illinois lottery, and Mike Jones, specifically, seems to be hiring at an incongruous rate. This year, Jones hired Scarlet Robinson, an Internet gaming consultant based out of Las Vegas, Nevada, to consult to the Illinois lottery. For only six months of work, that seems to have produced no searchable results or obvious improvement in the Illinois lottery, Ms. Robinson was paid a whopping $155,000. And for a lottery commissioner so obsessed with the apparent lack of transparency in the bidding process for the lottery he now runs, there doesn't seem to be much of a paper trail when it comes to a bidding process for his own lottery consultants.
A source also tells Illinois Review that the Illinois Lottery is pushing a lucrative $192,000, sole source contract to a consultant named Craig Scott to examine Internet lottery sales. …
Such are the problems that arise when an interested party leaves state government to win a state contract, fails to do so, and then goes back into state government to grind his ax. Jones is hardly the most scandal-plagued politician in Illinois. But he is part of the problem.