A top official closely involved in an investigation into inflated Lotto Texas jackpot advertisements was named acting executive director of the lottery commission today.
Gary Grief, who has worked for the Texas Lottery Commission since its creation, was promoted from deputy executive director. He will oversee day-to-day operations at the nation's third-largest lottery, replacing Executive Director Reagan Greer, who resigned Friday.
Greer stepped down two weeks after admitting he approved a staff report proposing an $8 million advertised Lotto Texas jackpot for the June 8 drawing even though that report stated estimated sales could cover only $6.5 million. Two earlier jackpots also had been inflated.
Commission Chairman C. Thomas Clowe said Grief was the most qualified person to run the agency in the short term. But he emphasized that the decision does not mean Grief is a shoo-in for the permanent job.
"I can't tell you whether he'll be an applicant or not. I haven't discussed it with him. I don't know," Clowe said. He said a committee, including for the first time members of the public, will conduct a far-reaching search for the best candidate.
Grief also was named acting executive director in 2002 when Greer's predecessor was fired. He was passed over for the permanent job that time, even though the commission had to lower the educational requirements because Greer did not have a bachelor's degree.
Greer accepted responsibility for the jackpot problem, saying he hadn't paid close enough attention to the staff recommendations before approving them.
But Grief also has been criticized for failing to act on a June 3 e-mail warning management that sales were not expected to cover the jackpot for the June 8 drawing.
Lee Deviney, one of the two managers who proposed the inflated jackpots, sent the e-mail on a Friday evening, hours after Greer signed off on the jackpot proposal but long before the agency began advertising the unsupported prize.
Greer has said he did not receive that e-mail until the following Monday. Grief, however, replied to Deviney's e-mail within an hour, saying "we will need to discuss on Monday."
Dawn Nettles, a longtime lottery watchdog who brought the inflation to light by filing a complaint with the state attorney general's office, said Grief should have taken action as soon as he found out about the shortfall.
"Gary Grief is clearly the one who is responsible for the entire incident," Nettle said. "He had that e-mail ... he had plenty of time" to address Deviney's concerns.
Clowe said Grief was "not in the line of authority" to make a decision on the jackpot.
"He was concerned about it, but it was not his responsibility. It was Reagan Greer's responsibility," he said.
At the time, agency policy called only for Deviney, Greer and one other staff member to sign the jackpot proposals. Now four more people are required to sign the proposal, including the deputy director.
When asked whether Grief should have contacted Greer about the problem, Clowe said he couldn't answer that question because he didn't have the facts in front of him.
Deviney was fired after the inflation became public, but lottery officials insist his termination was not related to the controversy.
Deviney said he proposed the inflated jackpot because the agency didn't have a clear policy on what should happen if ticket sales aren't expected to cover the next jackpot. The Lotto Texas jackpot starts at $4 million and traditionally grows by at least $1 million each time no tickets match all five numbers and a bonus ball.
During the first four drawings, the commission is allowed to use its reserves to pay a grand prize winner if it hasn't sold enough tickets to cover the jackpot. But ticket sales usually are slow until the jackpot reaches $9 million in the sixth drawing.
All three cases of inflation involved the fifth drawing with the jackpot rolling from $7 million to $8 million.
The commission discussed, but did not act on, two proposed rules changes meant to protect the public from similar problems in the future. One proposal would allow the agency to guarantee all Lotto Texas grand prize winners either the advertised jackpot or the jackpot based on sales, whichever is higher. The other would guarantee jackpots through the first 20 drawings.