minority business

AN AGENCY OF THES TATE OF T E XAS

MINORITY BUSINESSPARTICIPATION REPORT

For The Fiscal Year Ending August 31, 2007

February 20, 2008

The Honorable Rick PerryThe Honorable David DewhurstThe Honorable Tom CraddickMembers of the 80th Legislature Ladies and Gentlemen:

In accordance with Section 466.107 of the State Lottery Act, the Texas Lottery Commission is submitting its annual Minority Business Participation Report for fiscal year (FY) 2007.

During FY 2007, the agency achieved an overall participation rate of 27.07 percent in its minority/Historically Underutilized Business (HUB) contracting activity. This represents an increase from FY 2006, and exceeds the 10-year high that the agency achieved in FY 2004. The agency also continued to surpass its 20-percent goal for licensed minority retailers.

During FY 2008, we will continue to implement initiatives designed to increase the minority/HUB participation in our business operations.

Should you have any questions regarding the report, please do not hesitate to contact our executive director, Mr. Anthony Sadberry.

Sincerely,

James A. Cox Jr.Chairman

TABLE OF CONTE NTS

I NTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

BACKGROUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

EXECU TIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

PRI ME CONTR ACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

FISCAL YEAR 2007 HIGHLIGH TS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

FISCAL YEAR 2007 MI NORITY/HUB EXPE NDITURE SUMMARY . . . . . . . . . . . . . . . . 8

FISCAL YEAR 2007 ACCOMPLISHME NTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

FISCAL YEAR 2008 RECOMME NDED I MPROVE ME NTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

APPE NDICES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15

TEXAS LOTTERY COMMISSION

INTRODUCTION

The Texas Lottery Commission (TLC) has prepared its annual Minority Business Partici-pation Report for fiscal year (FY) 2007 in accordance with Section 466.107 of the State Lottery Act. This report documents the agency’s level of minority business participation both in its lottery and bingo regulatory contracting activity, and in the licensing of lottery sales agents. It also provides recommendations for the improvement of lottery-related minority business opportunities.

As defined by the State Lottery Act, a “minority business” is a “business entity at least 51 percent of which is owned by minority group members or, in the case of a corporation, at least 51 percent of the shares of which are owned by minority group members.” Minority group members include African Americans, American Indians, Asian Americans, Mexican Americans and other Americans of Hispanic origin. Throughout this report, the terms “minority- owned business” and “minority business” are used interchangeably.

Although it is not specifically addressed by the State Lottery Act, the TLC also has a strong commitment to including minorities in its business operations by maintaining a diverse workforce. Information about this area is included in Appendix D of the report (page 25).

M I N O R I T Y B U S I N E S S PA RT I C I PAT I O N R E P O RT F Y 2 0 0 7 1

MINORITY BUSINESSPARTICIPATION REPORT

FISCAL YEAR 2007

BACKGROUND

TEXAS LOTTERY COMMISSION VISION

To be the preeminent Lottery and Charitable Bingo agency through innovative leadership.

TEXAS LOTTERY MISSION

The Texas Lottery is committed to generating revenue for the state of Texas through the responsible management and sale of entertaining lottery products. The Texas Lottery will incorporate the high-est standards of security and integrity, set and achieve challenging goals, provide quality customer service and utilize a TEAM approach.

CHARITABLE BINGO MISSION

Provide authorized organizations the opportunity to raise funds for their charitable purposes by conducting bingo. Determine that all charitable bingo funds are used for a lawful purpose. Promote and maintain the integrity of the charitable bingo industry throughout Texas.

CORE VALUES

The Texas Lottery Commission combines private business management principles with public service standards of conduct in all its operations. The following values guide us in our work:

• Integrity and Responsibility • Innovation • Fiscal Accountability • Customer Responsiveness • Teamwork • Excellence

MINORITY / HUB COMMITMENT

The Texas Lottery Commission is committed to assisting and including minority-owned businesses and Historically Underutilized Businesses (HUBs) in its procurement opportunities. In accordance with the provisions of the State Lottery Act, Texas Government Code, Chapter 466, the agency and its prime contractors make a good faith effort to contract and subcontract with minority-owned businesses for the purchase of supplies, equipment, and services for the operation of the agency.

T E X A S L O T T E RY C O M M I S S I O N2

MINORITY / HUB PROGRAM

The TLC’s Minority/HUB Program functions as part of the agency’s Administration Division. The agency’s HUB Coordinator is responsible for advising and assisting the TLC in complying with the requirements of the State Lottery Act and the state’s HUB rules. The agency’s Minority/HUB Program operates in three key areas to promote the inclusion and utilization of minority-owned businesses and HUBs: outreach activities, contract compliance and reporting.

OUTREACH ACTIVITIES

Outreach activities make up one of the most important components of the TLC’s Minority/HUB Program. The purpose of these activities is to inform minority/HUB vendors about opportunities to provide goods and services to the agency and its prime contractors. Outreach is performed primarily by coordinating and participating in business opportunity forums and other events. The TLC also hosts its own annual HUB Forum to inform minority/HUB vendors about the agency’s procure-ment process and provide networking opportunities. A chart listing the outreach events in which the agency participated during FY 2007 is available in Appendix C (page 24).

Other types of outreach activities include providing information to prospective vendors via the TLC Web site, coordinating meetings with individual minority/HUB vendors, administering the agency’s Mentor-Protégé Program, and assisting eligible businesses with obtaining state HUB certification.

CONTRACT COMPLIANCE

The TLC’s HUB Coordinator, Purchasing and Contracts staff, and administering divisions work collaboratively to maintain vendor compliance with contract terms relating to minority and HUB participation. The first step in this process involves assisting the agency with making HUB subcon-tracting determinations for contracts totaling more than $100,000 prior to releasing solicitations. Pre-bid and pre-proposal conferences are held to highlight the TLC’s HUB policy and subcontracting requirements. The HUB Coordinator also assists evaluation teams by reviewing bids/proposals to determine whether the HUB good faith effort criteria was met. Finally, the agency’s subcontracting plans are monitored for compliance following contract awards.

REPORTING

Throughout the year, the TLC’s minority/HUB expenditures are monitored and reported. Minority/HUB participation updates are provided to the commissioners, executive management and agency staff on a regular basis. In addition, HUB subcontracting expenditures and supplemental informa-tion are reported twice annually for inclusion in the Statewide HUB Reports.


EXECU TIVE SUMMARY

During FY 2007, the TLC continued its efforts to provide opportunities for minority-owned buinesses to particpate in its procure-ment processes. Developing contacts with minority-owned businesses in Texas and licensing minority retailers as Texas Lottery sales agents are essential to the agency’s initiatives.

During FY 2007, the TLC achieved an overall participation rate in its minority/HUB contracting activity of 27.07 percent. As shown in Figure 1, total expenditures paid to minority/HUB vendors increased from the previous fiscal year. Figure 2 summarizes payments made to minority-owned businesses (not including non-minority women). During this report period, although direct spending with minorities decreased, subcontracting payments to minority businesses increased by nearly $4 million. Figure 3 shows the break-down of FY 2007 spending by ethnic group.

The TLC’s overall expenditures, as captured by the Comptroller of Public Accounts (CPA) Fiscal Year 2007 Annual Statewide HUB Report, increased from FY 2006 to 2007. During this report period, the TLC ranked 12th by overall expenditures among the top 50 largest-spending agencies.

FIG. 2MINORITY SPENDING

FIG. 1MINORITY/HUB SPENDING

(IN MILLIONS)


During FY 2007, the TLC continued to exceed its statutory goal of a 20-percent minority-owned Texas Lottery retailer base. Minority retailers now number 6,636, which represents 40.94 percent

of the agency’s total Texas Lottery retailer base (see Figures 4 and 5). During this report period, the number of minority retailers increased in all 10 Texas Lottery sales districts. In addition, for the fourth consecutive year, the TLC has maintained a minority retailer percentage of more than 38 percent. More detailed information on minority retailers is located in Appendix B (page 18).

FIG. 3FY 2007

MINORITY/HUB SPENDINGBY ETHNICITY

FIG. 5FY 2007

MINORITY RETAILERSBY DISTRICT


FIG. 4NUMBER OF

MINORITY RETAILERS

PRI ME CONTR ACTORS

The Commission’s prime contractors during FY 2007 for contracts estimated to be $100,000 or more included the following:

ADT SECURITY SYSTEMS, INC. - Security system leasing and monitoring services.

AFFILIATED FORENSIC LABORATORY, INC. - Instant ticket testing services.

AUSTIN RIBBON AND COMPUTER SUPPLIES, INC.* - Computer equipment leasing.

DAVILA, BUSCHHORN AND ASSOCIATES, P.C.* - Lottery drawings audit services.

EXECUTIVE SECURITY SYSTEMS, INC. - Uniformed security guard services.

GTECH CORPORATION (LOTTERY OPERATOR) - Texas Lottery operation terminals and systems, leasing of Instant Ticket Vending Machines (ITVMs), telecommunications, field marketing, retailer training, and instant ticket warehousing and distribution.

IPSOS-REID CORPORATION - Lottery market research services.

M&S WORKS - Production services for live broadcasts of drawings.

MAXWELL, LOCKE AND RITTER, LLP - Auditing services.

MEYERTONS, HOOD, KIVLIN, KOWART AND GOETZEL, P.C. - External legal services for intellectual property issues.

PAUL ADAMS PRODUCTIONS, INC. - TV-style game show at State Fair of Texas.

POLLARD BANKNOTE, LTD. - Instant ticket manufacturing and services (secondary vendor).

RANDALL EUBANK, PHD. - Statistical consulting services.

SCIENTIFIC GAMES INTERNATIONAL, INC. - Instant ticket manufacturing and services.

TRACYLOCKE, LP - Advertising and media buying services.

VERICENTER, INC. - Web site hosting services and maintenance.

XEROX CORPORATION - On-site document management and copy center.

*HUB-certified contractors.


• The TLC’s minority/HUB expenditures totaled more than $42.6 million.

• Subcontracting payments to minority/HUB businesses increased by more than $10 million.

• Six of the the TLC’s prime contractors increased subcontracting payments to minority/HUB businesses.

• For FY 2007, the Texas Lottery Commission ranked 12th in terms of overall expenditures as captured by the CPA’s Fiscal Year 2007 Annual Historically Underutilized Business (HUB) Report. However, of the 12 largest-spending state agencies, the TLC ranked number one by overall HUB percentage (see Table B). In fact, the TLC ranked number one by overall HUB percentage of the 25 largest-spending state agencies.

• Two HUB companies provided major contract services to the agency during FY 2007.

• The TLC participated in 16 economic opportunity forums and HUB-related outreach events statewide.

• The TLC conducted a successful annual HUB forum on July 31, 2007, which attracted minority/HUB participants from across the state. The agency’s use of roundtable networking sessions at this event allowed maximum interaction between attendees and key agency staff/prime contract vendors.

• Although the TLC did not have active mentor-protégé relationships during FY 2007, the agency worked diligently to establish new relationships, in accordance with 34 TAC §20.28. This effort resulted in five new mentor-protégé relationships that will become effective during FY 2008.

• The TLC HUB Coordinator provided leadership of the Legislative and TAC Rules Subcommittee of the HUB Discussion Workgroup.

• The TLC continued to maintain a minority retailer percentage of more than 38 percent for the fourth consecutive year.

FISCAL YEAR 2007 HIGHLIGH TS


FISCAL YEAR 2007 MI NORITY/HUB EXPE NDITURE SUMMARY

TABLE A

I. DIRECT MINORITY/HUB EXPENDITURES

MINORITY/HUB GROUP DIRECT EXPENDITURES % OF TOTAL TOTAL EXPENDITURES

AFRICAN AMERICAN

HISPANIC AMERICAN

ASIAN AMERICAN

NATIVE AMERICAN

AMERICAN WOMEN

TOTAL

$124,105

$620,124

$96,119

$0

$1,519,234

0.08%

0.39%

0.06%

0.00%

0.96%

$2,359,582 1.50% $157,463,262

II. PRIME CONTRACTOR MINORITY/HUB SUBCONTRACTING EXPENDITURES

MINORITY/HUB GROUP SUBCONTRACTINGEXPENDITURES

% OF NON-MINORITY/NON-HUB TOTAL

TOTAL NON-MINORITY/NON-HUB EXPENDITURES

AFRICAN AMERICAN

HISPANIC AMERICAN

ASIAN AMERICAN

NATIVE AMERICAN

AMERICAN WOMEN

TOTAL

III. GRAND TOTAL OF MINORITY/HUB EXPENDITURES

MINORITY/HUB GROUP % OF TOTAL TOTAL EXPENDITURES

AFRICAN AMERICAN

HISPANIC AMERICAN

ASIAN AMERICAN

NATIVE AMERICAN

AMERICAN WOMEN

TOTAL

$5,871,421

$9,579,288

$107,590

$0

$27,059,814

3.73%

6.08%

0.07%

0.00%

17.18%

$42,618,113 27.07% $157,463,262

MINORITY/HUBEXPENDITURES

NOTE: Fiscal Year expenditures were based on the reportable expenditure object codes utilized by the Comptroller of Public Accounts (CPA) for the State of Texas HUB Report. Minority/HUB expenditures were derived from the Fiscal Year 2007 Annual Historically Underutilized Business (HUB) Report plus Texas Lottery Commission spending with minority vendors (direct and indirect) who were not HUB certified during FY 2007. Amounts listed above may not exactly match amounts on CPA Report due to rounding.


3.71%

5.78%

0.01%

0.00%

16.47%

25.96% $155,103,680$40,258,531

$5,747,316

$8,959,164

$11,471

$0

$25,540,580

FISCAL YEAR 2007 ACCOMPLISHME NTS

The Texas Lottery Commission promotes fair and competitive business opportunities for minor-ity/HUB businesses interested in contracting with the agency and its prime contractors. The TLC conducted an effective program during FY 2007 to inform and educate minority/HUB businesses about opportunities to provide supplies, equipment, and services for the operation of the agency and to serve as licensed sales agents.

The following sections detail some of the TLC’s achievements in FY 2007.

INCLUSION IN PROCUREMENTS

Many of the TLC’s procurement-related initiatives contributed to its minority/HUB participation. These included:

• Participating in forums and other outreach events to inform minority/HUB vendors about the TLC’s contracting and subcontracting opportunities.

• Hosting an annual HUB forum to present procurement-related information to minority/HUB vendors and provide networking opportunities.

• Determining the probability of subcontracting and identifying potential minority/HUB subcontracting opportunities for contracts totaling $100,000.

• Evaluating good-faith-effort compliance with HUB subcontracting plan requirements.

• Monitoring contracts totaling more than $100,000 to ensure subcontracting plan compliance.

• Providing procurement opportunities at HUB Forums and other outreach events.

• Hosting meetings with interested vendors to assist them in becoming familiar with the TLC’s procurement processes.

• Conducting post-contract award meetings with vendors for contracts more than $100,000 to discuss subcontracting plan requirements.

• Assisting eligible vendors to become certified as HUBs.

Bids/Proposals Received and Contracts Awarded: During FY 2007, the TLC received 73 competitive bids and proposals from HUB vendors, which represented nearly 34 percent of all responses. Overall, the agency awarded 199 total contracts to HUB vendors, 146 of which were awarded to minority-owned HUBs. These included contracts resulting from noncompetitive “spot purchases,” informal and formal quotes, offers, and proposals received from HUB vendors.



Advertisements: During FY 2007, the TLC ran print advertisements for minority/HUB outreach events in minority-owned newspapers. Examples of the types of advertising placed are available in Appendix E (page 27).

Outreach Materials: The TLC provided information to minority businesses and HUBs that were interested in doing business with the agency. This included information regarding the agency’s procurements, and contacts for both agency staff and TLC prime contractors.

Web site: Information about the the TLC’s Minority/HUB Program is available via the agency’s Web site (www.txlottery.org), which also provides links to Statewide HUB Program information.

Forums: In accordance with legislative mandates, TLC staff participated in conferences, forums and vendor fairs to provide information regarding the agency and its procurement opportunities. As part of the TLC’s outreach program, staff attended Economic Opportunity Forums (EOFs) sponsored by state agencies and/or other governmental entities. In addition, staff participated in numerous conferences and events coordinated by small, minority- and woman-owned business organizations. A summary of the agency’s outreach efforts is identified in Appendix C (page 24) of this report.

The TLC conducted one of its most important outreach activities, the Texas Lottery Commission Annual HUB Forum, on July 31, 2007, in Austin. The forum drew 41 minority- and woman-owned companies from throughout the state. Texas Lottery Commission presenters provided an overview of the agency’s procurement opportunities and processes, as well as other information to assist HUBs. In addition, at the FY 2007 HUB Forum, the agency offered roundtable networking sessions for the second year in a row. Attendees had the opportunity to meet face-to-face with agency management and staff, as well as with representatives from some of the TLC’s prime contractors. The roundtable format was very popular with the vendors who attended the forum, and positive feedback was received.

Subcontracting Opportunities: In FY 2007, the TLC continued to identify subcontracting opportunities for minority/HUB vendors, and subcontracting expenditures paid to minority-owned businesses increased during the report period.

OUTREACH ACTIVITIES

In accordance with Texas Government Code, Section 2161.065, all state agencies with biennial bud-gets of more than $10 million are required to have a Mentor-Protégé Program. The purpose of the Mentor-Protégé Program is to foster long-term relationships between prime contractors and HUBs. The ultimate goal of the program is to provide developmental assistance to HUBs that will potentially increase their ability to contract directly with the state and/or to obtain subcontract opportunities under a state contract.

Although the TLC did not have active mentor-protégé relationships during FY 2007, the agency worked diligently to establish new relationships, in accordance with 34 TAC §20.28. This effort resulted in five new mentor-protégé relationships that will become effective during FY 2008.

MENTOR-PROTEGE PROGRAM´ ´


The Mentor-Protégé Program is an ongoing initiative of the TLC. All relationships among men-tors, protégés and the program sponsor are voluntary, and participation in the agency’s Mentor-Protégé Program is neither a guarantee for a contract opportunity nor a promise of business.

HUB DISCUSSION WORKSHOP

The TLC participates in the HUB Discussion Workgroup, a collective of HUB coordinators from state agencies and institutions of higher education that meets on a regular basis. The workgroup shares “best practices” and ideas, sponsors outreach events, and provides input on methods to improve the state’s HUB Program. During FY 2007, the TLC HUB Coordinator served as Chair of the Legislation and TAC Rules Subcommittee. The subcommittee tracks legislative and rule changes that affect the state’s HUB program, and communicates information to the group at large.

PRIME CONTRACTOR SUPPORT

Prime contractors are encouraged to include minority businesses and HUBs when purchasing goods and/or services related to the fulfillment of their contracts with the TLC. For contracts totaling more than $100,000, when the TLC determines that subcontracting is probable, respondents must perform good-faith-effort activities and meet subcontracting plan requirements. The state’s Centralized Master Bidders List and HUB Directory are key resources available to the TLC’s prime contractors for identifying HUBs who may be capable of performing subcontracting opportunities. Many prime contractors participated in the TLC’s FY 2007 HUB Forum, providing information and networking opportunties to potential HUB subcontractors. Through these efforts, the TLC’s prime contractors who offered subcontracting opportunities achieved the following results in FY 2007:

PRIME CONTRACTOR NAME MINORITY/HUB SUBCONTRACTING

TRACyLOCkE

GTECH CORPORATION

SCIENTIFIC GAMES INTERNATIONAL

POLLARd BANkNOTE, LTd.

VERICENTER, INC.

dAVILA, BuSCHHORN, & ASSOCIATES

IPSOS-REId CORPORATION

M & S WORkS

ExECuTIVE SECuRITy SySTEMS, INC.

$28,006,596

$5,698,630

$4,425,994

$1,477,011

$457,362

$80,133

$77,068

$59,970

$55,899




RANK AMONG LARGEST-SPENDING AGENCIES

For FY 2007, the Texas Lottery Commission ranked 12th in terms of overall expenditures as captured by the CPAs Fiscal Year 2007 Annual Historically Underutilized Business (HUB) Report. Of the 12 largest-spending agencies, the TLC ranked number one by overall HUB percentage (see Table B). In fact, the TLC had the highest overall HUB percentage of the top 25 largest-spending agencies.

MINORITY RETAILERS

The Texas Lottery Commission’s minority retailer base consistently exceeds its statutory goal of 20 percent. In FY 2007, the agency’s minority retailers numbered 6,636 which represented 40.94 percent of the Texas Lottery’s total retailer base (see Figure 4, page 5, and Appendix B, page 18). This represents an increase from the previous fiscal year. In addition, the agency has continued to maintain a minor-ity retailer percentage of more than 38 percent for the past four fiscal years. The percentage of minority retailers exceeds 20 percent in eight of the Texas Lottery’s 10 individual sales districts. This is also an improvement from FY 2006, when the percentage of minority retailers exceeded 20 percent in seven of the 10 sales districts.

RANK AGENCY NAME TOTALEXPENDITURES

HUBEXPENDITURES

TExAS LOTTERy COMMISSION

HEALTH ANd HuMAN SERVICES COMMISSION

TExAS A & M uNIVERSITy (MAIN uNIVERSITy)

uNIVERSITy OF TExAS SySTEM

THE uNIVERSITy OF TExAS AT AuSTIN

dEPARTMENT OF STATE HEALTH SERVICES

uT SOuTHWESTERN MEdICAL CTR - dALLAS

uT MEdICAL BRANCH AT GALVESTON

TExAS dEPARTMENT OF CRIMINAL JuSTICE

TExAS dEPARTMENT OF TRANSPORTATION

uT Md ANdERSON CANCER CENTER

TExAS GENERAL LANd OFFICE - FISCAL

$157,463,263

$542,184,000

$196,541,600

$534,524,398

$272,539,004

$257,833,783

$347,274,298

$301,905,206

$306,23,311

$6,401,496,110

$826,753,276

$160,646,518

27.02%

25.90%

20.58%

18.75%

16.26%

13.35%

12.71%

11.57%

10.89%

10.43%

7.93%

0.36%

$42,541,911

$140,431,946

$40,445,899

$85,588,541

$44,312,821

$34,408,936

$44,123,459

$34,928,672

$33,651,547

$667,815,900

$65,560,926

$572,547

HUBPERCENTAGE

1

2

3

4

5

6

7

8

9

10

11

12

Note: The largest spending agencies are determined by total expenditures made for object codes which are reportable in the CPA’s Fiscal Year 2007 Annual Historically Underutilized Business (HUB) Report. The state does not have an overall HUB goal, but utilizes six procurement category goals, in accordance with the State Disparity Study. These figures are for HUB utilization only, and do not include expenditures made to uncertified minority businesses, which are included in the Texas Lottery Commission’s totals elsewhere in this report. These figures are unaudited.

TABLE BANNUAL FISCAL YEAR 2007 STATEWIDE HUB REPORT

12 LARGEST-SPENDING AGENCIES RANKED BY OVERALL HUB PERCENTAGE


FISCAL YEAR 2008 RECOMME NDED I MPROVE ME NTS

• Focus on performance in procurement categories where goals were not attained in FY 2007.

• Update the TLC’s minority/HUB outreach materials and HUB Program Web content.

• Continue to develop training and/or other methods to assist vendors with HUB subcontracting plan preparation.

• Develop additional mentor-protégé relationships and continue to improve TLC’s Mentor Protégé Program.

• Continue to increase TLC staff ’s HUB Program awareness by providing information and training opportunities.

• Develop new opportunities for prime contractors to interact with potential minority/HUB subcontractors.

• Continue to improve the agency’s Annual HUB Forum to address the needs of minority/HUB businesses.


A P P E N D I C E S

A . DEFI NITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16

B. MI NORITY RETAILERS BY COUNTY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

C . FISCAL YEAR 2007 OU TREACH EVE NTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24

D. WORKFORCE DIVERSITY HUMAN RESOURCES S TATE ME NT . . . . . . . . . . . . . 25

E . SAMPLE ADVERTISE ME NTS I N MI NORITY NEWSPAPERS . . . . . . . . . . . . . . . . . . . 26

APPE NDIX A

MINORITY BUSINESSAs defined in Texas Government Code §466.107 (b), “Minority Business” means a business entity at least 51 percent of which is owned by minority group members or, in the case of a corporation, at least 51 percent of the shares are owned by minority group members, and that:

1) is managed and, in daily operations, is controlled by minority group members; and

2) is a domestic business entity with a home or branch office located in this state and is not a branch or subsidiary of a foreign corporation, firm or other business entity.

“MINORITY GROUP MEMBERS” include African Americans, American Indians, Asian Americans, and Mexican Americans and other Americans of Hispanic origin.

HISTORICALLY UNDERUTILIZED BUSINESS (HUB): As defined in Texas Government Code, §2161.001 subdivisions (2) and (3), “historically underutilized business” means an entity with its principal place of business in the state of Texas that is:

1) a corporation formed for the purpose of making a profit in which 51 percent or more of all classes of the shares of stock or other equitable securities are owned by one or more economically disadvantaged persons who have a proportionate interest and actively participate in the corporation’s control, operation and management;

2) a sole proprietorship created for the purpose of making a profit that is completely owned, operated, and controlled by an economically disadvantaged person;

3) a partnership formed for the purpose of making a profit in which 51 percent or more of the assets and interest in the partnership are owned by one or more economically disadvantaged persons who have a proportionate interest and actively participate in the control, operation and management;

4) a joint venture in which each entity in the venture is a historically underutilized business, as determined under another paragraph of this subdivision; or

5) a supplier contract between a historically underutilized business determined under another paragraph of this subdivision and a prime contractor under which the historically underutilized business is directly involved in the manufacture or distribution of the goods or otherwise warehouses and ships the goods.

“ECONOMICALLY DISADVANTAGED” PERSON means a person who is economically disadvantaged be-cause of the person’s identification as a member of a certain group, including Black Americans, Hispanic Americans, women, Asian Pacific Americans, and Native Americans, and who has suffered the effects of discriminatory practices or other similar insidious circumstances over which the person has no control.

DEFINITIONS


APPE NDIX A

COMMISSION: As defined in Texas Government Code, §466.002(1), “Commission” means the Texas Lottery Commission.

HUB SUBCONTRACTING PLAN: As defined by Texas Administrative Code Title 34, Part 1, Chap-ter 20, Subchapter B, Rule §20.12, a HUB subcontracting plan is “written documentation regarding the use of HUB subcontractors, which is required by a state agency in procurements with an expect-ed value of $100,000 or more which a potential contractor/vendor must prepare and return with their bid, proposal, offer, or other applicable expression of interest. The HUB subcontracting plan subsequently becomes a provision of the contract awarded as a result of the procurement process.”

LOTTERY: As defined in Texas Government Code, §466.002(5), “lottery” means the procedures operated by the state under this chapter through which prizes are awarded or distributed by chance among persons who have paid, or unconditionally agreed to pay, for a chance or other opportunity to receive a prize.

SALES AGENT OR SALES AGENCY: As defined in Texas Government Code §466.002(9), “sales agent” or “sales agency” means a person licensed under this chapter to sell tickets.

SUBCONTRACTOR: As defined in Texas Government Code §2251.001, “subcontractor” means a person who contracts with a vendor to work or contribute toward completing work for a govern-mental entity.

LOTTERY OPERATOR: As defined in §466.002(7), “lottery operator” means a person selected under §466.014(b) to operate a lottery.

VENDOR: As defined in Texas Government Code §2251.001, “vendor” means a person who supplies goods or a service to a governmental entity or another person directed by the entity.

DEFINITIONS


APPE NDIX B

MINORITY RETAILERS BY COUNTY

COUNTY TOTAL RETAILERS MINORITY RETAILERS PERCENTAGE

ANdERSON

ANdREWS

ANGELINA

ARANSAS

ARCHER

ARMSTRONG

ATASCOSA

AuSTIN

BAILEy

BANdERA

BASTROP

BAyLOR

BEE

BELL

BExAR

BLANCO

BORdEN

BOSQuE

BOWIE

BRAZORIA

BRAZOS

BREWSTER

BRISCOE

BROOkS

BROWN

BuRLESON

BuRNET

CALdWELL

CALHOuN

CALLAHAN

CAMERON

CAMP

CARSON

CASS

CASTRO

CHAMBERS

CHEROkEE

CHILdRESS

CLAy

COCHRAN

COkE

COLEMAN

COLLIN

40

10

59

23

8

1

33

30

5

12

58

4

19

183

902

14

0

23

50

186

132

10

3

9

35

20

35

22

18

11

201

8

7

21

8

29

41

5

5

4

4

12

281

10

0

14

5

0

0

17

16

0

2

23

0

5

59

453

3

0

8

7

119

78

3

0

4

1

8

12

4

9

1

62

2

1

3

0

11

13

1

0

0

0

0

102


25.00%

0.00%

23.73%

21.74%

0.00%

0.00%

51.52%

53.33%

0.00%

16.67%

39.66%

0.00%

26.32%

32.24%

50.22%

21.43%

0.00%

34.78%

14.00%

63.98%

59.09%

30.00%

0.00%

44.44%

2.86%

40.00%

34.29%

18.18%

50.00%

9.09%

30.85%

25.00%

14.29%

14.29%

0.00%

37.93%

31.71%

20.00%

0.00%

0.00%

0.00%

0.00%

36.30%

APPE NDIX B



COLLINGSWORTH

COLORAdO

COMAL

COMANCHE

CONCHO

COOkE

CORyELL

COTTLE

CRANE

CROCkETT

CROSBy

CuLBERSON

dALLAM

dALLAS

dAWSON

dEAF SMITH

dELTA

dENTON

dEWITT

dICkENS

dIMMIT

dONLEy

duVAL

EASTLANd

ECTOR

EdWARdS

ELLIS

EL PASO

ERATH

FALLS

FANNIN

FAyETTE

FISHER

FLOyd

FOARd

FORT BENd

FRANkLIN

FREESTONE

FRIO

GAINES

GALVESTON

GARZA

GILLESPIE

0

9

8

1

0

8

7

0

0

2

1

1

0

689

1

1

3

95

1

0

6

0

6

3

7

1

21

93

3

4

7

4

0

1

0

134

1

2

2

1

168

0

0

0.00%

30.00%

11.94%

8.33%

0.00%

21.05%

25.93%

0.00%

0.00%

28.57%

12.50%

12.50%

0.00%

42.69%

14.29%

7.14%

100.00%

36.82%

10.00%

0.00%

66.67%

0.00%

50.00%

13.04%

8.33%

33.33%

25.00%

24.16%

14.29%

33.33%

33.33%

18.18%

0.00%

20.00%

0.00%

62.62%

20.00%

9.09%

14.29%

9.09%

62.45%

0.00%

0.00%

3

30

67

12

5

38

27

1

5

7

8

8

9

1614

7

14

3

258

10

3

9

6

12

23

84

3

84

385

21

12

21

22

3

5

1

214

5

22

14

11

269

6

16


APPE NDIX B



GLASSCOCk

GOLIAd

GONZALES

GRAy

GRAySON

GREGG

GRIMES

GuAdALuPE

HALE

HALL

HAMILTON

HANSFORd

HARdEMAN

HARdIN

HARRIS

HARRISON

HARTLEy

HASkELL

HAyS

HEMPHILL

HENdERSON

HIdALGO

HILL

HOCkLEy

HOOd

HOPkINS

HOuSTON

HOWARd

HudSPETH

HuNT

HuTCHINSON

IRION

JACk

JACkSON

JASPER

JEFF dAVIS

JEFFERSON

JIM HOGG

JIM WELLS

JOHNSON

JONES

kARNES

kAuFMAN

1

5

20

16

110

124

28

71

21

7

9

4

7

48

3121

41

1

7

77

5

52

357

40

13

41

25

21

30

3

64

17

5

8

19

34

2

226

8

41

92

9

14

76

0

1

9

2

39

24

14

24

4

0

0

0

1

8

2125

3

0

1

15

0

22

184

4

2

5

6

3

3

1

32

1

0

1

3

5

1

57

5

18

31

0

1

40

0.00%

20.00%

45.00%

12.50%

35.45%

19.35%

50.00%

33.80%

19.05%

0.00%

0.00%

0.00%

14.29%

16.67%

68.09%

7.32%

0.00%

14.29%

19.48%

0.00%

42.31%

51.54%

10.00%

15.38%

12.20%

24.00%

14.29%

10.00%

33.33%

50.00%

5.88%

0.00%

12.50%

15.79%

14.71%

50.00%

25.22%

62.50%

43.90%

33.70%

0.00%

7.14%

52.63%


APPE NDIX B



kENdALL

kENEdy

kENT

kERR

kIMBLE

kING

kINNEy

kLEBERG

kNOx

LAMAR

LAMB

LAMPASAS

LA SALLE

LAVACA

LEE

LEON

LIBERTy

LIMESTONE

LIPSCOMB

LIVE OAk

LLANO

LOVING

LuBBOCk

LyNN

MAdISON

MARION

MARTIN

MASON

MATAGORdA

MAVERICk

MCCuLLOCH

MCLENNAN

MCMuLLEN

MEdINA

MENARd

MIdLANd

MILAM

MILLS

MITCHELL

MONTAGuE

MONTGOMERy

MOORE

MORRIS

5

0

0

3

2

0

0

11

0

16

0

2

0

1

9

3

32

3

0

2

4

0

18

0

5

3

0

2

19

11

0

58

0

4

0

4

2

1

0

6

156

3

2

26.32%

0.00%

0.00%

7.69%

15.38%

0.00%

0.00%

37.93%

0.00%

34.04%

0.00%

15.38%

0.00%

5.88%

45.00%

12.00%

47.06%

13.04%

0.00%

11.76%

21.05%

#dIV/0!

12.95%

0.00%

50.00%

17.65%

0.00%

40.00%

47.50%

44.00%

0.00%

31.52%

0.00%

12.90%

0.00%

5.56%

8.00%

20.00%

0.00%

35.29%

57.56%

15.79%

22.22%

19

0

1

39

13

1

3

29

4

47

13

13

6

17

20

25

68

23

5

17

19

0

139

3

10

17

1

5

40

25

10

184

2

31

3

72

25

5

6

17

271

19

9



MOTLEy

NACOGdOCHES

NAVARRO

NEWTON

NOLAN

NuECES

OCHILTREE

OLdHAM

ORANGE

PALO PINTO

PANOLA

PARkER

PARMER

PECOS

POLk

POTTER

PRESIdIO

RAINS

RANdALL

REAGAN

REAL

REd RIVER

REEVES

REFuGIO

ROBERTS

ROBERTSON

ROCkWALL

RuNNELS

RuSk

SABINE

SAN AuGuSTIN

SAN JACINTO

SAN PATRICIO

SAN SABA

SCHLEICHER

SCuRRy

SHACkELFORd

SHELBy

SHERMAN

SMITH

SOMERVELL

STARR

STEPHENS

3

51

44

15

19

232

6

1

69

37

17

55

8

23

29

89

6

8

37

2

5

15

8

11

1

24

31

16

28

14

10

16

68

7

3

9

4

19

2

117

10

33

7

0

12

16

2

0

67

0

0

8

5

5

15

0

7

11

30

4

4

5

0

1

5

2

2

0

7

9

0

11

0

2

12

15

0

0

0

0

5

0

51

2

22

1

0.00%

23.53%

36.36%

13.33%

0.00%

28.88%

0.00%

0.00%

11.59%

13.51%

29.41%

27.27%

0.00%

30.43%

37.93%

33.71%

66.67%

50.00%

13.51%

0.00%

20.00%

33.33%

25.00%

18.18%

0.00%

29.17%

29.03%

0.00%

39.29%

0.00%

20.00%

75.00%

22.06%

0.00%

0.00%

0.00%

0.00%

26.32%

0.00%

43.59%

20.00%

66.67%

14.29%

APPE NDIX B



APPE NDIX B



STERLING

STONEWALL

SuTTON

SWISHER

TARRANT

TAyLOR

TERRELL

TERRy

THROCkMORTON

TITuS

TOM GREEN

TRAVIS

TRINITy

TyLER

uPSHuR

uPTON

uVALdE

VAL VERdE

VAN ZANdT

VICTORIA

WALkER

WALLER

WARd

WASHINGTON

WEBB

WHARTON

WHEELER

WICHITA

WILBARGER

WILLACy

WILLIAMSON

WILSON

WINkLER

WISE

WOOd

yOAkuM

yOuNG

ZAPATA

ZAVALA

0

0

0

0

391

4

0

0

0

4

2

161

5

0

5

0

4

6

13

16

29

20

0

10

51

26

1

24

2

3

47

7

0

14

7

0

1

8

8

0.00%

0.00%

0.00%

0.00%

34.79%

3.92%

0.00%

0.00%

0.00%

19.05%

2.67%

28.50%

29.41%

0.00%

26.32%

0.00%

16.00%

24.00%

40.63%

26.67%

61.70%

57.14%

0.00%

32.26%

38.93%

53.06%

14.29%

23.30%

16.67%

33.33%

29.19%

28.00%

0.00%

34.15%

36.84%

0.00%

5.88%

61.54%

66.67%

1

2

8

4

1124

102

1

8

2

21

75

565

17

15

19

3

25

25

32

60

47

35

12

31

131

49

7

103

12

9

161

25

7

41

19

8

17

13

12

TOTAL 16,211 6,636 40.94%


APPE NDIX C

FISCAL YEAR 2007 HUB, MINORITY AND SMALL BUSINESS OUTREACH EVENTS

I. STATE ECONOMIC OPPORTUNITY FORUMS LOCATION

II. TEXAS LOTTERY COMMISSION FORUMS

TExAS LOTTERy COMMISSION ANNuAL HuB FORM

III. VENDOR FAIRS, CONFERENCES & PROCUREMENT EVENTS

AuSTIN

MIdLANd

AuSTIN

SAN MARCOS

MCALLEN

ARLINGTON

AuSTIN

AuSTIN

WEST TExAS ECONOMIC dEVELOPMENT SuMMIT: “SELLING TExAS ONE REGION AT A TIME”

THE uNIVERSITy OF TExAS SySTEM ANd uNIVERSITy OF TExAS AT AuSTIN HuB VENdOR FAIR

CENTRAL TExAS BuSINESS PROCuREMENT CONFERENCE SPONSOREd By TExAS STATE uNIVERSITy

ECONOMIC OPPORTuNITy FORuM: “SELLING TExAS ONE REGION AT A TIME”

11TH ANNuAL GOVERNMENT PROCuREMENT CONFERENCE SPONSOREd By uT - ARLINGTON

6TH ANNuAL HuB FORuM (CO-HOSTEd By THE TExAS ALCOHOLIC BEVERAGE COMMISSION, TExAS EduCATION AGENCy ANd OTHER STATE AGENCIES)

HEALTH ANd HuMAN SERVICES COMMISSION HuB VENdOR FAIR 2007

AuSTIN HISPANIC CHAMBER OF COMMERCE 2Nd ANNuAL PROCuREMENT FAIR

7TH ANNuAL TExAS ASSOCIATION OF AFRICAN AMERICAN CHAMBERS OF COMMERCE CONFERENCE ANd SPOT BId FAIR

uNITEd STATES HISPANIC CONTRACTORS ASSOCIATION NETWORkING RECEPTION ANd ExPO

HOuSTON MINORITy BuSINESS COuNCIL ExPO 2006

THE CITy OF SAN ANTONIO ANd BExAR COuNTy’S 6TH ANNuAL SMALL, MINORITy ANd WOMAN BuSINESS OWNER’S CONFERENCE

GOVERNMENT PROCuREMENT CONNECTIONS 2006

6TH ANNuAL LOWER COLORAdO RIVER AuTHORITy VENdOR OPEN HOuSE

TExAS ASSOCIATION OF MExICAN AMERICAN CHAMBERS OF COMMERCE 31ST ANNuAL CONVENTION ANd BuSINESS ExPO

2007 SOuTH TExAS CONTRACTING OPPORTuNITIES CONFERENCE

AuSTIN

HOuSTON

AuSTIN

HOuSTON

SAN ANTONIO

HOuSTON

AuSTIN

SAN ANTONIO

SOuTH PAdRE ISLANd



APPE NDIX D

WORKFORCE DIVERSITY HUMAN RESOURCES STATEMENT

The Texas Lottery Commission (TLC) strives to ensure that its employee population reflects the ethnic and gender composition of the state of Texas. A workforce comprising nearly 63 percent women and 43 percent minorities is the result of our aggressive approach to equal opportunity practices (see table below).

The TLC takes great pride in its workforce diversity. Efforts to maintain and enhance this diversity are apparent in the open and fair availability of employment opportunities to all members of the public, as well as to TLC employees. TLC staff is expected to treat others with respect. The agency recognizes that maintaining a diverse workforce plays a role in reaching our goal of increased minor-ity participation. This recognition of the value of employee uniqueness is an important factor in the TLC’s overall effectiveness.

Programs and policies that aid in accomplishing the goal of workforce diversity include:

• Encouraging a Team Approach • Emphasizing employment recruiting and retention • Monitoring workforce demographics • Defining management roles and responsibilities • Equal Employment Opportunity (EEO) training for management

TEXAS LOTTERY COMMISSION WORKFORCE

TEXAS LOTTERY EMPLOYEES BY ETHNICITYAS OF NOVEMBER 30, 2007

ETHNICITY NUMBER OF EMPLOYEES

% OF AGENCY EMPLOYEES

TEXAS LOTTERY EMPLOYEES BY GENDERAS OF NOVEMBER 30, 2007

ETHNICITY NUMBER OF MALES


ETHNICITY NUMBER OF FEMALES


AFRICAN AMERICAN

HISPANIC AMERICAN

ASIAN AMERICAN

NATIVE AMERICAN

TOTAL MINORITIESCAuCASIAN AMERICAN

TOTAL EMPLOYEES

37

91

4

1

133176

309

11.97%

29.45%

1.29%

0.32%

43.04%56.96%

100%

AFRICAN AMERICAN

HISPANIC AMERICAN

ASIAN AMERICAN

NATIVE AMERICAN

CAuCASIAN

TOTAL MALES

TOTAL AGENCYEMPLOYEES 309 100%

8.74%

19.74%

0.32%

0.00%

33.98%

62.78%

27

61

1

0

105

194

AFRICAN AMERICAN

HISPANIC AMERICAN

ASIAN AMERICAN

NATIVE AMERICAN

CAuCASIAN

TOTAL FEMALES

3.24%

9.71%

0.97%

0.32%

22.98%

37.22%

10

30

3

1

71

115


A P P E N D I X E

SAMPLE ADVERTISEMENTS IN MINORITY NEWSPAPERS


APPE NDIX E


Annual Historically Underutilized Business Forum (HUB)

The forum will provide an update on legislation affecting the HUB program, a Mentor Protégé presentation, and a roundtable networking session featuring key decision makers from both the Lottery Commission and its prime contractors. Roundtable assignments will be made on a first-come, first-serve basis on the day of the forum.

For more information contact:Joyce Bertolacini, HUB coordinator512.344.5293joyce.ber t [email protected]

The TLC HUB Forum is FREE of charge! Register on-line on or before 7/23/2007 at:www.txlottery.org/hub

Tuesday, July 31, 20071:00 - 4:30 pm

611 East 6th Street - Austin, Texas

© 2007 Texas Lottery Commission. All rights reserved.

Texas Lottery Commission


APPE NDIX E


Foro Sobre Empresas Históricamente Subutilizadas (HUB)

El foro proveerá una actualización de la legislación que afecta al programa HUB, presentación del programa mentor y pupilo y una mesa redonda de trabajo con personas claves en la toma de decisiones de la Comisión de la Lotería y sus principales contratistas.

La asignación de lugares para la mesa redonda será según se presenten de primero el día del foro.

Para más información contacte a:Joyce Bertolacini, Coordinador de HUB512.344.5293joyce.ber t [email protected]

¡El foro del TLC HUB no tiene ningún cargo!Regístrese en línea el o antes del 7/23/07 en:www.txlottery.org/hub

Martes, 31 de Julio, 20071:00 - 4:30 pm

611 East 6th Street - Austin, Texas

© 2007 Texas Lottery Commission. Todos los derechos reservados.

La Comisión de la Lotería de Texas

Texas LoTTery Commission

P . O . B O X 1 6 6 3 0

A U S T I N , T E X A S 7 8 7 6 1 - 6 6 3 0

P H O N E 5 1 2 . 3 4 4 . 5 0 0 0

F A X 5 1 2 . 4 7 8 . 3 6 8 2

W W W . T X L O T T E R Y . O R G

W W W . T X B I N G O . O R G

AN AGENCY OF THES TATE OF T E XAS

minority business

Documents