Originally created 08/14/04

Lotto execs get big bonuses



ATLANTA - Executives of the Georgia Lottery Corp. received more than $559,000 in bonuses after registering another record sales year, even though the Legislature voted to cut benefits under lottery-funded HOPE scholarships.

The $559,623 in bonuses was approved by the lottery board July 22, board Chairwoman Barbara Dooley said.

It was less than the $587,000 given out in 2003 because the senior staff shrank by two and because a half-year bonus for the new chief executive was slightly less than half the $210,000 full-year bonus former CEO Rebecca Paul received, Ms. Dooley said.

Ms. Paul and three of her lieutenants left in September to run the Tennessee lottery.

Margaret DeFrancisco, hired in January to replace Ms. Paul at a $225,000 annual salary, received a $100,000 bonus for six months' work. Ms. DeFrancisco deserved the bonus because she "carried us through ... in such great fashion," Ms. Dooley said.

Executive Vice President Cathy Walls, who served as interim CEO, received a $108,000 bonus, almost triple the previous year's. Senior Vice President Joan Schubert was paid an incentive of $70,500, a 76 percent increase over the previous year's bonus. Seven vice presidents received $36,000 bonuses - 36 percent more than last year.

Other employees received smaller bonuses, ranging from $4,700 to $12,600, based on their annual pay and the same as the year before. Lottery salespeople are paid on commission.

According to Ms. Dooley, after the departure of Ms. Paul and the others, the board promised its remaining executives a boost in incentive pay if they stayed through the fiscal year that ended in June.

For the year, the lottery sold a record $2.71 billion in tickets. In the previous year, ticket sales brought in $2.6 billion.

It is from the sales revenue that the lottery pays prizes, administrative expenses, marketing and other costs.

The total cash designated for education-related spending, including the HOPE college scholarships, was $782 million - the most in the lottery's 11-year history. So the board felt good about increasing executive bonuses for just one year, Ms. Dooley said.

Sen. Mitch Seabaugh, R-Sharpsburg, a member of the General Assembly's lottery oversight committee, said he was "sad that they would take this action."

Compensation for lottery employees came under scrutiny this year as legislators debated how to contain the costs of HOPE scholarships funded by the lottery. An oversight committee in May looked at executives' generous leave package.

Some lawmakers say the Legislature needs to look more closely at the annual bonuses for senior staff members and rank-and-file employees, which cost 11 times more than they did in 1993, the lottery's first year.