State of Texas: Lottery leaders accused of enabling illegal activity in Senate hearing

  

AUSTIN (Nexstar) – On Wednesday, a routine budget hearing for the Texas Lottery Commission turned into a harsh warning from lawmakers.

The Senate Finance Committee urged the commission to take action to ban courier services that allow players to buy lottery tickets through external sources. The committee accused the commission of turning a blind eye to money laundering and letting minors and out-of-state players participate in the Texas lottery system. 

During the hearing, several senators on the committee questioned Ryan Mindell, Executive Director of the Commission since April 2024 about a $95 million Lotto Texas jackpot in April 2023. A Houston Chronicle Investigation found that a group of wealthy investors spent more than $25 million to buy tickets that included virtually all of the possible number combinations. 

“Typically, finance committee hearings are how much money do you need? Will you settle for half this time?” said John Moritz, the chief politics reporter for the Austin American-Statesman. “They were wanting some answers on how this jackpot was arranged, what the lottery officials knew, how they knew it, and why didn’t they do anything about what they saw?” 

According to the report, in order to overcome the logistical hurdles of buying and processing millions of tickets, the Texas Lottery Commission provided extra terminals to businesses that worked with the investors. After the investigation was published, the commission changed its policies and limited how terminals were deployed. 

One of the key reasons that Senators began to question the lottery’s business practices is because the lottery commission was scheduled for a Sunset Review.  A Sunset Review is a common practice for most state agencies that typically occurs on a 12-year cycle. Essentially, the Texas Lottery Commission has to prove their worth to lawmakers by the end of the legislative session. If lawmakers don’t proactively vote to extend the Texas Lottery Commission, they, along with the lottery as a whole, will cease to exist. But, the Texas Sunset Commission wasn’t thrilled with what they found during their investigation, said Moritz. 

“They were very critical of some of the processes of the Lottery Commission, very critical of management and oversight of the Lottery Commission,” said Moritz about the Sunset hearing. “And that’s what set the stage for the hearing in the Finance Committee this week or last week. And that’s where the thing really became public.”

This jackpot win raised concerns for some about the fairness and legitimacy of the lottery. But, buying up an entire draw is not prohibited by Texas Administrative Code or the State Lottery Act. Senators were more focused on the method in which these tickets were purchased as digital start-ups have begun to stretch the boundaries of the rules. Courier companies let customers order and pay for tickets via apps.

“Do we still have couriers or did you take the hint that it was not in line with what the intent of the legislature was to have them and change the rules?” asked Sen. Bob Hall, R-Edgewood, during the hearing.

Mindell responded. “Couriers are still operating in Texas today. They are outside of the regulatory authority of the Texas Lottery. We regulate the brick and mortar retail location and that’s who we license and that’s who we have regulatory control over.”

Mindell added that the Commission is “neutral” on the topic of courier services. In line with the Sunset Commission’s concerns, however, the commission is asking for legislative assistance in developing regulatory control over couriers, which they claim to have no control over currently. 

Hall further questioned Mindell on the courier’s role in selling lottery tickets to minors and out-of-state players. Mindell struggled to defend the commission in his response. 

“Don’t you think that’s serious enough to give you a reason to not use the couriers? By using them, you are facilitating minor gambling, and that’s one of the top things that you agreed that you’re supposed to be protecting,” said Hall. 

According to the Government Code’s State Lottery Act, the Commission has the authority to adopt all rules necessary to prohibit ticket sales to minors and those playing a lottery game by phone. The Senate Finance Committee continued to question the Commission on why they didn’t approach the Attorney General sooner about these concerns. 

“They’re not obeying the law now, and it’s obvious that they have no intent to obey the law,” Hall said during an interview. 

Other lawmakers raised concerns about the potential for enabling criminal acts, particularly money laundering. 

“This is 99% probability money laundering. True?,” Sen. Paul Bettencourt R – Houston asked Mindell in the hearing.

“I couldn’t commit on that,” Mindell responded.

“Well you need to be able to commit, because you need to be able to say what are the obvious signs? Because normal consumers don’t go buy $25 million of $1 tickets,” Bettencourt fired back, thumping his fist on the desk for emphasis.

According to Bettencourt, the lottery commission’s lack of accountability should be grounds for investigation. 

“We’re gonna get answers because I can’t speak for the Lt. Governor but I can tell you that when an agency acts this bad, there will be consequences for it,” said Bettencourt.

‘The people of Texas deserve this’: Senate discusses bail reform proposals

Texas lawmakers in the Senate Committee on Criminal Justice talked extensively on Wednesday morning about five proposed bail reforms.

“I truly believe that there are hundreds of people dead today that would not be dead if we had incorporated some of this legislation earlier on,” the author of the five bills, Sen. Joan Huffman, R-Houston, said. “The people of Texas deserve this.”

The committee’s first action was to name Senate Joint Resolution 1, a proposed constitutional amendment to prevent undocumented defendants from posting bail for felony charges, to “Jocelyn’s Law.”

Jocelyn Nungaray was a 12-year-old Houston girl who was allegedly kidnapped, sexually assaulted and killed by a pair of Venezuelan men who entered the country illegally. Both men had been arrested by U.S. Border Patrol for entering the country illegally before Nungaray’s death but were released and told to show up to court at a later date.

“These individuals had no business being here in the first place,” Jocelyn’s mother Alexis Nungaray said during a press conference Wednesday morning. “Anyone who comes here illegally and creates and does crime should not be allowed a bond. It’s not right. It’s very inhumane.”

The bill is intended to pair up with the U.S. Government’s Laken Riley Act, requiring officials to detain immigrants accused of theft, burglary or shoplifting. For Nungaray, she says having the bill named after her daughter is bittersweet.

“It reminds me that I’m really making change for her and I am really continuously being her voice,” Nungaray explained.

Senate Joint Resolution 5, another proposed constitutional amendment needing a public vote to adopt, would give judges discretion to not allow bond for people held under certain violent charges.

“There’s nothing partisan about asking our judges to hold people accountable when they do horrible things,” Paul Castro said during Wednesday’s presser. Castro’s son David was killed in a road rage incident in 2021. “But that was just the beginning of the horrors… The judge knew that he was a violent offender and tried to set a bail bond high enough that it would not be met — $350,000. Unfortunately because of a loophole in the system, he was able to get out barely a month after he was arrested.”

Current law only gives judges the discretion to hold a defendant in custody for 60 days under no bail holds. SJR 5 would allow judges to hold those who are deemed threats to safety until their trial date.

“The fact that this person who was a known violent offender, was able to achieve a bond at all, and the fact that in order to stop it we would have had to have my 13-year-old son testify as to what happened that night in 60-day intervals for perhaps as long as four years… simply unacceptable,” Castro said.

Proponents of SJR 5 emphasized a pattern of defendants on bail committing more violence.

“This week, we documented 162 cases of defendants who are on bond that are now charged with murder since 2021 in Harris County,” Andy Kahan, director of victim services for Crime Stoppers Houston, said. “There is absolutely no downside in allowing judges discretion. It’s not a mandate, and I’m sure most of the judges in this state would say we would love to have discretion in Jocelyn’s case. Everybody was outraged when a cash bond was given. How could that happen? It’s capital murder. Well, guess what? The judge had no choice. He had to grant a cash bond. My best guess perhaps, if the judge had a choice, which is what the constitutional amendment would be, there would be no bond.”

In opposition, Stammen called SJR 5 “a dangerous proposal that would undermine public safety and strip legally innocent Texans of their rights and freedoms.”

“Changes to the right to bail must ensure pretrial detention remains the exception, not the norm,” she continued in her written statement to the committee. “SJR 5 would increase family and caregiver separation, employment loss, economic insecurity, housing instability, and worsen medical and behavioral health outcomes.”

Four of the five bills in Huffman’s bail reform package passed out of committee on Wednesday with unanimous support. Huffman said s he wanted to leave SB 1047 pending in committee, which deals with enhancing the Public Safety Report System.

Lt. Gov. Dan Patrick said these bills will likely pass out of the Senate next week, and he made a promise that he will play “hardball” with the Texas House of Representatives to make sure these bills are passed this session.

“As far as I’m concerned, if these bills do not pass the House, I see no reason for us not to go to a special session, and another special session, and another special session,” Patrick said during a news conference when asked what “hardball” would look like.

April Aguirre, the aunt of Arlene Alvarez, who was shot and killed while going to Valentine’s Day dinner with her family, said she will be bringing more advocates for the bills to House committee hearings when they reach that point. She says people who want to testify during those hearings
can reach out to her on her X account.

The lieutenant governor said he hopes the bills will pass out of the Senate with full bipartisan support, but at least one Senate Democrat has already expressed reservations on SJR 5.

State Sen. Sarah Eckhardt, D-Austin, said these bills have the potential to place more people in the “crosshairs of our criminal justice system,” and says she is preparing for debate next week.

“As lawmakers, we should defend that presumption strenuously. Right now these bills suggest a greater interest in undermining it for political purposes than upholding it in pursuit of solutions to truly keep Texans safe,” Eckhardt said in a news release.

Her office points to data from Harvard’s Kennedy School’s Social Policy Data Lab which reports the pre-trial detention rates in the United States are 50% higher than Russia. Eckhardt believes the state must vigorously prosecute violent crime, but it must be done in a way that respects due process and the presumption of innocence before trial, according to a spokesperson in her office.

Central Texas mom awaits nearly $40K in child support. Parents owed $21B statewide

On the Saturday morning we were supposed to meet Ashely Bolling, she had already been up since 2:30 a.m. One of her daughters was sick and violently vomiting for hours. 

“Sorry, this is such a mess,” she texted. “Story of my life!”

Bolling was frantically trying to figure out what was going on with her 7-year-old. By mid-morning, she was relieved her daughter was feeling better — but the episode was just another example of what life is like for the single mom of three: “Everything is chaotic all the time.”

We spoke with Bolling on a rare day off. She runs a cleaning service and provides home health care and explained it’s been challenging raising her daughters without the help of their dads — especially her middle daughter’s. She showed us records from the Texas Attorney General’s office that he owes them nearly $40,000 in child support.

“There’s never enough time. There’s never enough money. There’s never enough me. There’s never enough help,” she said, her voice breaking as tears started coming down her face.

The Office of the Attorney General enforces child support in Texas. Data KXAN investigators obtained shows as of the end of December, the amount of child support owed statewide has topped $21 billion. 

Bolling isn’t the only one of those Central Texas parents to reach out to KXAN about the challenges they’re facing to get the money they’re owed.

“They have screwed up my child support so badly that I did not receive my May or June child support. That’s $4,600,” wrote another single mom last summer to KXAN. “I have called five times and get a different answer and the run around every time.”

In November, another parent emailed KXAN asking us to look into the AG’s office “not enforcing child support payments.”

KXAN has reached out to the AG’s office about the Child Support Division, and while it has yet to respond to our questions, Attorney General Ken Paxton addressed it as he presented his office’s proposed budget to lawmakers in January.

“I feel for these parents that need help and — and I really wanted to make a difference in that program — even though it doesn’t get a lot of publicity — but it does really matter,” Paxton said.

Bolling said she’s repeatedly called the agency about not receiving payments, and officials there tell her they can’t locate her ex to make him pay.

“I’ve had two case investigators over the 7 years, and that was me calling and basically begging, begging, begging for someone to call me back,” she added. 

She explained that if she tracks down a new address for him, she shares it with the AG’s Child Support Division. She said she’s notified the agency of at least 20 different addresses. KXAN investigators have asked the AG’s office about Bolling’s case but have yet to get a response.

Bolling says if she’s not able to get her ex in front of a judge who can hold him in contempt, “we don’t move forward.”

One way Bolling thinks could help find him: adding him to a list on the AG’s website.

Since 1997, Texas law has required the AG’s office to publicly name parents who are behind on child support. Then in 2019, the office created the Child Support Evader website which solicits tips online to find parents avoiding payments.

To be on the evader list, a parent must owe more than $5,000 in court-ordered child support, have an arrest warrant issued and regularly fail to pay in the last six months. As of December, records show there were 410,835 cases falling into that timeframe. Yet only seven parents are on the public webpage. It shows nearly 60 have been arrested between 2006 and late last year.

Bolling says she has received some payments in the past, but they haven’t been consistent. 

“For about a year during the pandemic, he ‘paid’ because the unemployment office paid me, not because he paid me. But how did someone who hasn’t had a job in all these years get unemployment?” Bolling wondered.

At a recent Texas Senate Finance hearing, Paxton fielded questions from state lawmakers considering his agency’s latest budget proposal including funding for child support enforcement.

“I am really pleased with what’s happened with child support over the last, say, four years. We did a complete restructure. We changed a lot. It’s become a lot more decentralized,” Paxton said during the hearing.

In the latest figures KXAN investigators obtained from the Legislative Budget Board, the AG’s office requested more than $390 million for “Child Support Enforcement” next fiscal year; a $25 million increase from the current fiscal year’s appropriation. 

“We’re trying to speed up the process because it was all getting stuck up in the bureaucracy, and we’re trying to figure out how can we get these people help faster,” Paxton added.

Since November, KXAN Investigators emailed and called Paxton’s office multiple times to ask how additional funding could help stop child support evaders and to learn more about the work of Child Support Division, but no one responded. Paxton also refused to speak with our team in person at the Capitol after that hearing.

During the budget hearing, officials with his office applauded what they call success in collecting money during Paxton’s tenure – attributing much of that to recent upgrades in technology. During Paxton’s administration, which began in 2015, the agency collected nearly $42 billion in child support. 

According to the federal Office of Child Support Services Fiscal Year 2023 Preliminary Report, Texas led the nation by collecting nearly $4.3 billion in child support.

The state has found ways to punish parents avoiding child support through a number of different enforcement measures. 

In severe cases, parents have been sent to jail. Last year alone, 92,452 liens were filed on either property, bank accounts or retirement plans; 81,703 passports were denied; 20,952 vehicle registrations were blocked; plus 1,091 licenses — including professional, hunting and driver’s licenses — were suspended.

“Judges have broad discretion when it comes to how they are going to enforce the orders and how lenient a judge is going to be can vary from courtroom to courtroom, from county to county,” said Jennifer Severn, a family law attorney who most recently worked in the AG’s Child Support Division. 

KXAN reached out to several judges in Travis and Williamson counties whose courts handle child support cases but they either declined to talk to us about enforcement measures or didn’t respond. 

Severn said she understands the frustrations shared by families fighting for child support payments. She explained that the case load is massive for the state and attorneys are doing the best they can with the resources they have.

“Voters must advocate for stronger child support enforcement by insisting that legislators fund and improve programs dedicated to ensuring the financial stability of children and families and tackling poverty. If these initiatives are truly valued by Texans, we cannot permit their defunding,” she said. 

Ultimately, Severn said hiring a private attorney is the quickest way to see any money. She encourages families who can’t afford attorney to contact the Austin Bar Association, Travis County Women Lawyers Association or the State Bar of Texas to ask about lawyers doing pro bono work. 

Bolling has an attorney, but she said she could no longer afford her. 

“I’m one paycheck away from being homeless,” she explained. “We’re out a vehicle because my car transmission went out.”

She has shared her concerns with lawmakers and has called her representatives to see what they can do about the system. This legislative session, several bills have been filed including paying retroactive child support beginning on the date of the child’s conception and lowering interest rates on overdue child support payments from 6% to 3%.

Sen. Judith Zaffirini, D-Laredo, is behind Senate Bill 629 and explained that lowering the financial pressure on overdue balances would encourage more parents to pay what they owe. 

“Overdue child support payments can quickly spiral out of control, with interest compounding so fast that catching up becomes nearly impossible. This bill would make repayment more manageable, helping parents stay on track and, most important, ensuring that children benefit from the resources they deserve,” Zaffirini said. 

Last session, lawmakers made other significant changes like giving judges the power to order parents behind on child support payments to get a job or enroll in a community employment program.

The Texas Workforce Commission along with family court judges and the AG’s office also provide help through a program, which targets low-income, unemployed or underemployed parents who are behind on child support. 

A spokesperson with TWC said during the fiscal year 2024, 1,971 program participants were ordered into the program with $4.5 million in child support collections achieved. Also, last year, 47.1% of participants gained employment after participating in the program. 

KXAN Investigators tried to reach Bolling’s ex but have not heard back. She said she hasn’t been able to reach him for several years now. She added that after we started looking into her case, he did make a few payments around Christmas last year but that’s since stopped again. 

“I can’t work another job,” Bolling said. “I’ve gotten on every support system that there is in our government.”

For parents like Bolling, it comes down to enforcement. She said if that’s lacking then no program or new laws will make a difference. She said the impact of not receiving the financial help is now so wide-reaching that it’s affecting everything else in their lives.

“I could have been a better mom with them being better dads,” she said. “There’s never enough to fulfill the need, and nothing’s gonna change.”

‘Why not?’ Parents question education savings account plans as legislation moves forward

On Super Bowl Sunday, parents, grandparents and community members packed into the sanctuary at Live Oak Unitarian Universalist Church in Cedar Park. People weren’t there to watch the game or for service, but instead to talk about a push to create “education savings accounts” in Texas.

Texas Gov. Greg Abbott has promised to sign such legislation during the 89^th legislative session, despite his failed effort last session.

The Texas Senate easily passed Senate Bill 2 on Wednesday, a bill that would give anywhere from $2,000 to $11,500 to participating students based on disability status and whether they go to private school or learn at home.

Texas State Rep. Vikki Goodwin, D-Austin, was one of the panelists talking about the “school choice” legislation at the Cedar Park church. On the panel, Goodwin referenced remarks from Sen. Robert Nichols, R-Jacksonville, who was the only Senate Republican to not vote for SB 2.

“Really it’s not choice, it’s a chance,” Goodwin said.

Megan Cooper, an attendee with grandchildren in the Pflugerville Independent School District, said she anticipates the program will become reality in the state this year.

“If we are going to give state funds to private schools, are we going to make sure they also have to provide special education services? Are we going to make sure they also have to provide transportation?” Cooper asked. “I don’t want it to pass, but should it pass I hope that the state of Texas will respond to the need that happens actually at the public school levels. So, we are not decimating public schools.”

A KXAN analysis of budget data for 58 school districts in Central Texas found most adopted deficit budgets in the 2024-25 school year. Many school district leaders have expressed fear a school choice program would further exacerbate budget shortfalls in public schools.

The legislative budget board said in its analysis of SB 2 that it “assumes 24,500 students would leave public schools for private schools in fiscal year 2027, increasing to 98,000 in fiscal year 2030.”

Shinara Morrison, who supports the legislation, said she has tried public schools and charter schools, but hasn’t found a program that works for her son. She hopes education savings accounts will help them try private school.

“Despite whether I have the money or not, you know, I still want to make sure that he’s well taken care of education-wise,” Morrison said. “Why not? That’s my real question. Why not, even if it’s for a trial period? Why can’t we even just try it and see, and let’s go based on the results.”

James Gallagher, a volunteer at the church’s forum, said he’s most concerned about accountability for private schools and the cost on taxpayers for funding public education and education savings accounts.

“This thing could mushroom and balloon out of control. At what point do they think they have achieved enough school choice,” Gallagher asked.

SB 2 lays out a plan for if the number of applications for education savings accounts exceeds available spots. The legislation would require a lottery where 80% of the available spots would be filled by school students who are either from low-income households or who have a disability.

According to the fiscal note for SB 2, the general appropriations bill includes $1 billion in funding for an education savings account program, if one is enacted. The analysis estimated that the program could cost the state more than $4 billion by 2030, but also that it could save $805.5 million in the same time frame.