Trust issues expected to figure prominently in interviews with candidates light on specific experience

When questions about inflated jackpots forced Lottery Director Reagan Greer to resign earlier this year, lottery officials said they needed someone to replace him who could regain the public's trust.

A special search committee will begin Friday to interview nine finalists for the position, whittled down from 126 applicants. Only one of the nine people has experience working at a state lottery.

The diverse pool includes several candidates with extensive military experience, one with management experience at another state agency, two lawyers and the president of a lottery consulting company. Most did not return repeated calls from the Austin American-Statesman.

Whoever is selected will be charged with the difficult task of restoring the image of the nation's third-largest lottery and improving the dwindling Lotto Texas sales, down 35 percent from last year.

Plagued by those problems and a distrustful public, the Texas Lottery Commission in July established a search committee of Texas citizens to look for its next director. Included in this committee is one critic of the commission, former lottery employees, representatives from both the gambling and retail industries and other state agencies.

History has shown that experience is not a prerequisite for the director's job.

Greer's selection was criticized in 2002 when it was discovered he held a two-year degree from San Antonio College, and not a bachelor's degree. He was appointed to the job of executive director after he lost a bid for Bexar County district clerk.

This year, the one applicant getting the most publicity, who may have the most understanding of the Texas Lottery, is Dawn Nettles, the lottery's most vocal critic.

Nettles publishes the online lottery newsletter The Lotto Report and has spent several years criticizing the Texas Lottery for inflating jackpot estimates and bad management decisions that led to dwindling sales.

She is responsible for revealing the $1.3 million discrepancy that resulted in Greer's resignation.

"It took me a long time to make the decision to apply," Nettles said. "I know I've been a thorn in their side for so very long. I know I'm not their favorite person because I've caused them a lot of grief.

"But the players know I'm honest," she said, "and I know I'm more than qualified."

The question of honesty may arise more in this search process than it has before.

Lottery officials say the recent problems with the jackpot estimates have brought more attention to trustworthiness than experience.

"It is my intent to examine carefully each person's reputation," said Texas Lottery Commission Chairman Tom Clowe, the only commissioner who is a member of the search committee, "to look closely in regard to their understanding of integrity and honesty."

Some say experience in the military and a reputation for honesty might go hand-in-hand.

"We live by an honor code, and I can still recite it like it was yesterday," said applicant Stephen Malutich, the education director for an aviation school in Houston. "I believe in those things. I think the public understands generally what kind of people are in the military and what kind of values they hold."

Malutich moved to Texas in 1998 to run an Air Force recruiting office before he retired after 27 years of service.

Lottery officials won't say if there is a clear front-runner.

Clowe said the committee hasn't closed the search process yet and will still accept applications. There is no definite timetable for when a new director will be selected to replace interim Director Gary Grief.

One applicant is Mark Hutchinson, the president of a Nevada-based international lottery consulting and marketing company. He coordinated the marketing and sales divisions of both the Wisconsin and Kansas lotteries in the late 1980s and is the only person selected for an interview with experience at a state lottery.

Hutchinson did not return several calls from the Austin American-Statesman.

In lobbying for herself, Nettles said the Texas Lottery should avoid hiring people with lottery experience and instead look outside the lottery world for unconventional leadership.

"I don't think it's really necessary to have someone who has worked for the lottery," Nettles said. "But you should at least have somebody that has bought a ticket before."

The next Texas Lottery director?

• Dawn Nettles, publisher of the online Lotto Report
• Stephen Malutich, education director for a Houston aviation school, former manager of San Antonio Air Force recruiting office
• Mark Hutchinson, president of a Nevada-based international lottery marketing and consulting company
• Juan Garcia, Corpus Christi lawyer and former Navy pilot
• James Loyd, former executive director of Texas Health Care Information Council
• Juan Cabezas, vice president of marketing for Zebra Imaging Inc., a holographics company
• Robert Shipe, former executive director of the Texas Workers' Compensation Commission
• Sue McNabb, assistant attorney general in Louisiana, helped establish a state gambling treatment program
• Gordon Hickam, former director of application development at the Texas General Land Office, former regional director of the U.S. Treasury specializing in financial management