Gary C. Peters
Position: Commissioner, Bureau
of State Lottery
Educational Background: Bachelor’s degree,
Alma College; MBA, University of Detroit-Mercy; law degree, Wayne State
University Law School.
Professional Background: Appointed by Governor
Jennifer Granholm to the Department of Treasury in January 2003. State
senator 1995-2002, serving as chair of the Democratic Caucus and vice
chair of the Finance, Education, Judiciary and Natural Resources committees.
Member of the Michigan Law Revision and Michigan Sentencing commissions.
Rochester Hills City Council member. Private-sector background includes
employment as vice president–investments at UBS PaineWebber in Rochester
Hills and service on arbitration panels for the National Association of
Securities Dealers and the New York Stock Exchange. Peters also serves
as a Lt. Commander and a Seabee Combat Warfare Specialist in the U.S.
Naval Reserve.
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Q: Why did you move from Treasury to Lottery?
A: I enjoyed my position in Treasury, having been involved in pension
plans, corporate governance and other key issues. Moving to the Bureau
of State Lottery was a natural career progression, given my experience
in business and investment, along with administering a $40-billion pension
fund. I bring a unique combination of experience to the Lottery: I spent
over 20 years in the investment field, working for both Merrill Lynch
and UBS PaineWebber.
Because of the lottery’s many challenges, including
intense competition and the need for additional revenue for schools, Gov.
Granholm asked me to become commissioner of the Bureau of State Lottery
to keep the organization moving forward. The state lottery is now a $1.6-billion
business, and last year generated in excess of $600 million for Michigan’s
public schools.
My staff is extremely committed, and our mission is to
deliver entertaining, fun products with the highest levels of integrity.
Our purpose is to generate money for public schools, and we will accomplish
that task to the best of our ability.
Q: How did you begin your career in public service?
A: I began my public service career in local politics, when I served
as a Rochester Hills City Council member for two years. I decided to become
more fully involved in public service at the state level by running for
the 14th District Senate seat in Oakland County. I won it, and kept the
seat for eight years. Some of the state’s richest and poorest people
lived in the 14th district, which made the job very interesting to me.
Q: What’s your strategy for strengthening relationships
with retailers?
A: The lottery is a competitive business. Our products compete
with casinos across the state, and we need to be very aggressive with
our advertising and marketing strategies. We need to work closely with
our retail partners to stay ahead of the game. The relationship we have
with our retailers is critical to our ability to provide needed revenue
to Michigan’s public schools. Approximately 9,500 retailers throughout
the state offer our products. We want to continue to strengthen the relationship
with retailers, and work together in creative ways to increase sales.
Q: What new developments can we expect?
A: We will soon launch two new games—break-open tickets and
quick-draw Keno—for businesses with Class C liquor licenses. We’re
estimating an additional $50 million in profits to public schools with
these new games.
These games will not negatively affect retail sales. Approximately
nine other states operate Keno, and a similar number offer break-open
tickets. We have not seen retailers in these states affected by these
games, because they offer distinctly separate products. These games tend
to be more “social,” and are very different than the instant
tickets and the online games offered by our retailers.
As we’re launching and promoting these new games,
we will always keep the focus on our retailer base and our core products—the
Daily 3, Daily 4 and our instant games. Last year we saw an increase in
our instant ticket sales, and we’re continuing to see an increase
in 2003. In addition, we launched 72 new games last year to keep the lottery
fresh and exciting. Our retailers are a major reason these games have
been successful, because they’ve kept them visible through point-of-sale
displays and other marketing assistance.
Q: What are the major challenges facing the Lottery?
A: The legislature is discussing a possible $2 million reduction
in the Lottery’s advertising budget, which makes launching and marketing
our new games more difficult. If the proposed reduction is implemented,
I will likely need to cut funding from our core games. I plan to take
action against that measure, and I hope our retailers will join us in
the fight. The Lottery is a partner with retailers, and its advertising
budget directly impacts lottery sales in retail establishments across
the state.
Our budget is different than most state government budgets.
It’s a business budget, which means that sometimes money has to be
spent to be made. Advertising dollars increase sales. If our new games
are not launched effectively, we may lose between $10 and $20 million
in revenue for the School Aid Fund in the long run, and lose competitiveness
with casinos.
Numerous retirements have impacted and will continue to
impact the Lottery. So far, 29 staff members have retired, and only seven
have been replaced. I currently have five deputy commissioners on staff
that, together, have close to 50 years experience—but by the end
of June, three of the five will retire.
Q: How has the lottery changed since it began?
A: In 1973 the lottery was the only game in town, which made it
much easier to market and advertise. Increased competition has changed
the gaming landscape, and the challenge is to keep our offerings fresh
to stay one step ahead of the competition.
Q: Is being the commissioner a fun job?
A: I recently gave my first check to a retired couple that played
the lottery and won $175,000. I was just as excited as they were, and
I look forward to many more opportunities in this job to make people happy.
We also recently launched a new instant game called the
$2,000,000 Blast, in which five finalists will go to Comerica Park in
June. I’ll draw the number to give one of them $2 million. I’m
looking forward to that.
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