By Ray Stern
By New Times
By Amy Silverman
By Stephen Lemons
By Stephen Lemons
By Monica Alonzo
By Chris Parker
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It's tough to fight people with friends in high places. Just ask former Arizona State Lottery director J. Bruce Mayberry, who played hardball with GTECH, the biggest lottery computer vendor in the nation, and with Evans Group, which holds the state's largest advertising contract.
Governor J. Fife Symington III fired the highly regarded Mayberry after Mayberry started seeking concessions from GTECH and Evans Group. Both companies had hired Symington's former chief of staff and top fund raiser, George Leckie. Many observers believe it was Leckie--GTECH's hired lobbyist and Evans' hired consultant--who called the shots leading to Mayberry's dismissal.
Leckie resigned as Symington's chief of staff in 1992, because of his mismanagement of the Governor's Office budget. In one instance, after a trade mission to Japan, Leckie charged the state thousands of dollars for a weekend stay in Hawaii for him and his girlfriend. Leckie also turned out to have been behind the wheel in a hit-and-run, DUI case.
Despite these missteps, Leckie still has Symington's ear, and he still has value to those who want to get Symington's ear.
Leckie denies that he lobbied Symington, a Republican, on behalf of GTECH or Evans Group to get rid of Mayberry. The Governor's Office, in response to a New Times public-records request, says no records exist that show Leckie discussed lottery issues with Symington or with anyone on the governor's staff.
The denials don't impress state Senator Peter Rios, a Democrat and former Senate president. "Why was Leckie on GTECH's payroll as a lobbyist if he never lobbied anyone? That just doesn't make sense to me," Rios says.
Rios asked Attorney General Grant Woods to investigate Mayberry's firing, and Woods--a Republican who reportedly is considering a run against Symington in next year's gubernatorial primary--announced last week that his office would conduct a probe.
If Woods looks for a pattern, he won't have to look far, because GTECH has a habit of hiring political insiders to do its bidding. GTECH hired two associates of Maryland's governor during a controversial bidding war for that state's lottery contract. GTECH won the contract, but the U.S. attorney for Maryland has conducted a yearlong criminal probe into alleged bid-rigging.
Problems surfaced more recently in Kentucky, where the lottery director and its entire board resigned last month in the wake of a state audit alleging, among other things, that GTECH had benefited from contract loopholes and sloppy oversight. Although the audit does not allege criminal wrongdoing by GTECH, the Kentucky attorney general is investigating lottery operations.
The 31-year-old Mayberry--a former Xerox marketing executive--hooked up with Symington during Symington's 1990 campaign. Symington appointed Mayberry to run the state lottery in February 1991. By all accounts, including Symington's, Mayberry performed well, leading the lottery to record revenues in 1992.
"I thought he did a great job. There was plenty of opportunity for him to be successful in the future, and I was disappointed to see him go," says Richard Strohm, a lottery commissioner and Scottsdale attorney.
Mayberry declined to comment.
Mayberry got on GTECH's bad side when he tried to force the vendor to live up to its contract, which called for it to upgrade its on-line lottery system in Arizona.
The Rhode Island-based GTECH is a $500 million per year corporation that has mastered the art of securing and holding fat state contracts. GTECH supplies on-line computer systems for 25 of the 38 states with lotteries, including four of the eight highest-volume states--New York, New Jersey, California and Ohio. The company also provides lottery systems to 21 foreign countries.
Mayberry only had to look to Maryland to get a glimpse of how GTECH would play the game.
Last fall, the Maryland legislature erupted after it learned that GTECH had been awarded a $49 million, no-bid contract to add a keno-style game to that state's mix of lottery games. In December, the U.S. attorney for Maryland announced he would take the matter before a federal grand jury for review. The investigation is continuing.
In Maryland, GTECH hired former governor Marvin Mandell--the political mentor of current Governor William Donald Schaefer--as a consultant. Also on GTECH's payroll was Bruce C. Bereano, a loyal Schaefer supporter and key fund raiser.
With the help of Mandell and Bereano, GTECH won a nasty battle for the Maryland lottery contract in 1991 by underbidding the former vendor, Control Data, by $17 million. Questions immediately arose about whether GTECH had inside information that allowed it to low-ball the bid going in and make up for it later with the no-bid contract for the keno game.
After GTECH won the contract, Bereano was asked whether GTECH had insider information. The Baltimore Evening Sun reported that Bereano responded: "I have to take something to the grave." Bereano later said he was joking, and that he was referring to attorney-client confidentiality.
Mayberry's unseating began to take form early this year, after he expressed weariness about GTECH's delay in upgrading the lottery computer system. An improved system would allow winners to collect at any ticket retailer, rather than solely the outlet that sold the winning ticket.
Lottery records show the Arizona agency had negotiated with GTECH since August 1991, with little success. GTECH promised to act, but never signed an agreement. Mayberry wrote to GTECH last January, saying the lottery wanted the new system on-line by July 1. GTECH was hesitant to upgrade the system, because it would cost about $450,000, and GTECH wanted the state to foot the bill.