Wilson Replaces Top Lottery Official

In a sudden decision, Gov. Pete Wilson replaced the head of the embattled California lottery Wednesday and named an official from the state prison system as interim director.

A Wilson spokesman said Maryanne Gilliard, 35, a deputy director in the Department of Corrections, will take over as the lottery’s top official effective Monday. She will be paid an annual salary of $98,652. The lottery has a budget of about $356 million a year and generates more than $2 billion in revenue.

Sean Walsh, the governor’s spokesman, acknowledged that Gilliard has no lottery experience but said her strong law enforcement background was the key to her selection by Wilson. That background, Walsh said, will ensure that “everything is on the up-and-up at the agency.”

Adelbert “Del” Pierce, who has been interim director since 1993, will move to the Department of Corrections, where he will take a senior management position, Walsh said. Pierce was not available for comment.

Although Pierce has been under intense criticism from an Assembly committee for his handling of a lottery computer contract, Walsh said that had no bearing on the governor’s decision to name a new director.

He said Pierce is leaving the lottery by mutual consent. He said Pierce had wanted to move on for some time but had been asked by Wilson to remain until he finished negotiating a settlement of a contract dispute with High Integrity Systems. The computer company had been embroiled in a lawsuit with the lottery stemming from the cancellation of its $150-million contract that involved making it easier to cash scratcher tickets.

When the governor advised Pierce of the availability of the new position at the corrections department, Walsh said, Pierce “gladly accepted.” Pierce will continue to make $103,176.

Pierce tangled in recent weeks with a legislative budget committee when he refused to turn over documents that lawmakers said they hoped would explain why he and the State Lottery Commission had decided to settle the High Integrity Systems lawsuit under terms that were extremely favorable to the company.

Lawmakers said the settlement called for a reinstatement of the contract and required the state to pay millions of dollars in additional costs.

On Wednesday, Assemblyman Gary Miller (R-West Covina), who led the investigation of the contract, said he had not requested Pierce’s removal.

He said the lottery at first refused to release the documents, claiming lawyer-client privilege, but finally provided them after lawmakers threatened to use their subpoena power. He said that on Wednesday three boxes of material were delivered to his office and “we are still going through them.”

In a memorandum distributed to the lottery staff, Pierce referred to the lottery as the most “interesting and challenging business” he had ever been affiliated with.

“When I was first given this short-term assignment,” he wrote, “I never envisioned that 2 1/2 years would pass before the interim period was over.”

Pierce, a longtime bureaucrat, was first appointed to the lottery on an interim basis to restore the lottery’s credibility after former director Sharon Sharp’s handling of several multimillion-dollar contracts drew criticism from lawmakers and later the state auditor.

Walsh said Gilliard’s appointment is also temporary. He said she will head the agency while the governor searches for a new permanent director with strong administrative and marketing experience.

Assemblyman Debra Bowen (D-Marina del Rey) criticized the appointment, saying the governor is circumventing the state lottery act by not appointing a director with experience in the gaming industry. By naming an interim director, she said, the governor also will avoid a Senate confirmation hearing on Gilliard’s appointment.