The chief executive of the lottery in New Mexico resigned late Tuesday as all signs pointed toward his expected hiring Thursday as the first director of North Carolina's lottery.
North Carolina lottery Chairman Charles Sanders said in an interview that he would not deny or confirm that New Mexico's Tom Shaheen is the choice to start up the state's lottery games, which are expected to generate $400 million a year for education initiatives.
Sanders said that he would not comment on Shaheen's resignation in New Mexico.
"I think you can draw your own conclusions from that," Sanders said. Sanders said that all negotiations with the commission's top pick are completed but that a public announcement about the hire would be made Thursday, when the commission next meets.
The movement toward hiring a director came as the lottery experienced more turmoil Tuesday — lottery commissioner Gordon Myers of Asheville resigned, making him the third commissioner to step down.
Myers, a former vice president of the Ingles supermarket chain, told the commission's chairman Monday that he must step down because his stock ownership in the company might create the perception of a conflict of interest. Ingles intends to sell tickets when the lottery is started in the coming months.
"After last week's meeting, it became apparent to me that the issue of approving retail locations for lottery ticket sales will be controversial and subject to discussion by the Commission, as it is at the commission's discretion that the locations are approved," Myers said in his resignation letter, which was released Tuesday.
Sanders said the resignation caught him by surprise but that Myers may also have been troubled by the controversy surrounding the start of the lottery, which has attracted the attention of state and federal investigators.
"Maybe it made him more sensitive to the times we are living in," Sanders said.
Investigators are looking into lottery company Scientific Games' recent disclosure that it hired Kevin Geddings, a Charlotte public relations consultant, to push the lottery during the legislative session.
Geddings did not disclose the work when House Speaker Jim Black appointed him to the commission. He stepped down just hours before the company disclosed the work.
The company also hired lobbyist Meredith Norris during the legislative session. Until recently, she was Black's unpaid political director.
Norris and a company vice president said that she only monitored legislation and therefore did not have to register with the state as a lobbyist. The company later disclosed that it reimbursed her for more than $3,800 she spent wining and dining lawmakers.
One of Norris' lobbying clients is the N.C. Economic Development Group, which serves the state's seven economic development partnerships. Myers is a director for the group and chairman of one of the partnerships — AdvantageWest, which serves the 23 westernmost counties.
On Thursday, federal authorities served a subpoena on the group, seeking correspondence between Norris and the group, as well as records that show Norris' compensation, said Don Donadio, the group's attorney.
The group pays her to lobby lawmakers, and the partnerships have her under contract as an administrative aide.
Myers was also a Black appointee. Donadio declined to answer questions about whether Myers also had been subpoenaed.
Black, a Mecklenburg County Democrat, said in a statement that he was "saddened" to learn of Myers' resignation.
"Gordon is a well-respected business leader who brought a wealth of retail and business experience to the lottery commission, which was not only required by law but much needed as the commission works to set up the new Education Lottery in North Carolina," Black said.
Myers had disclosed his potential conflict regarding Ingles. He had said he would not speak privately with any potential lottery contractor, nor would he participate in any votes that could involve Ingles.
"He's come across to me as someone who is very sensitive and highly ethical, and I hate to lose him," Sanders said.
Myers was named to the commission because lawmakers required one member to have retailing experience. Sanders said that requirement might make it difficult for Black to find a replacement, because many retailers are expected to want to sell lottery tickets.
The third commissioner who resigned was Malachi J. Greene, a former Charlotte City Council member and an appointee of Senate leader Marc Basnight, a Manteo Democrat. Greene said he was too busy with other commitments to serve on the commission.
All of the finalists for the lottery job were asked about the controversies in private interviews last week, but most did not address them in brief exchanges with reporters later.
Shaheen has not returned telephone calls and could not be reached Tuesday.
He emerged as the possible choice Monday, when top lottery officials from South Carolina indicated that they were no longer in the running for the position. Of the six people interviewed last week, Shaheen is the only one still in the mix who has experience both running a lottery full time and starting one up. Before joining the New Mexico lottery, he helped start Georgia's. He is also the immediate past president of the national lottery association.
The head of the New Mexico lottery board told The Associated Press on Tuesday that Shaheen "will be greatly missed, but we certainly understand his desire to move on," without specifically confirming that he is taking the North Carolina job.
"As you know, good employees and good managers are hard to find, and when you have such a good manager, he's going to be attractive to other lotteries," board chair Reta D. Jones said.