LITTLE ROCK, Ark. — Arkansas Lottery Director Ernie Passailaigue is moving on, but the two top executives he brought with him from South Carolina say they hope to stay put.
Soon after Passailaigue left his job as director of South Carolina’s lottery to become director of the Arkansas Scholarship Lottery in the summer of 2009, he hired two South Carolina lottery officials, David Barden and Ernestine Middleton, to be his vice presidents in Arkansas at nearly $100,000 more than their salaries back home.
On Monday, the Arkansas Lottery Commission accepted Passailaigue’s resignation, effective Oct. 7.
“I’m not planning to go anywhere,” Barden, the lottery’s vice president of gaming operations, said today.
Barden, who was director of product marketing and development under Passailaigue in South Carolina, said he is happy where he is.
“The longer I’m here, the more I enjoy it. I like being here,” he said.
Ernestine Middleton, the Arkansas lottery’s vice president of administration and the former director of internal operations for South Carolina’s lottery, said she has “no plans of leaving.”
“My church is here, I’m on the United Way board, I’m part of organizations, I’ve got friends here,” she said.
Ultimately, it will be up to Passailaigue’s successor to say whether they can stay. Lottery commissioners say they will launch a search soon for the next director.
“These positions are at-will positions, so I guess a lot will be determined by who comes in,” Barden said.
Barden and Middleton received annual salaries of $133,038 and $143,923, respectively, in their South Carolina jobs. Passailaigue hired them each at $225,000 a year in July 2009, and they now make $225,655.
The six-figure salaries Passailaigue awarded to Barden, Middleton and other lottery officials have drawn some criticism. Passailaigue has defended their pay, saying that he could have hired less experienced people at lower salaries, but as a startup — the first games launched in September 2009 — the lottery needed administrators with experience in the industry.
Some criticism also attended the $324,000 salary at which the Lottery Commission hired Passailaigue in 2009 — his current salary is $326,832 — and Passailaigue went on to be at the center of a string of controversies during his tumultuous two years at the lottery’s helm.
Among other things, Passailaigue came under fire for awarding compensatory time to himself and other non-eligible employees, for an audit report that cited numerous problems with the lottery’s management and accounting practices and for a $100,000 penalty from the IRS for overdue taxes. The lottery is appealing the penalty.
But Passailaigue also has been praised for launching a program that is helping tens of thousands of Arkansans attend college. More than 30,000 students received lottery-funded scholarships in the 2010-11 school year.
Gov. Mike Beebe and some lottery commissioners have said the next director should be paid less to take over a running lottery than Passailaigue was to start one from scratch.