Lottery boss cites ‘cheap trick’ in resignation

In the wake of complaints about her questionable ties to a company trying to put slot machines at the Bangor Raceway, a lottery official resigned Tuesday citing “cheap political tricks” on the part of an anti-gambling Baldacci administration.

Kathleen Newman, a member of the Maine State Liquor and Lottery Commission since 1998, submitted her resignation before the commission’s Tuesday meeting in Augusta.

Newman’s letter, however, carried with it no concessions that sitting on the commission and working for Capital Seven LLC, was “inappropriate,” as had been suggested by Gov. John Baldacci.

On the contrary, Newman defended her initial decision to remain on the board, while bashing the governor and his political friends for attempting “to manufacture a conflict as a tactic in their campaign to undo the Nov. 4 election results.”

“Implications that it is improper [to] serve as a consultant to Capital Seven and serve on this commission are thinly veiled attempts at swaying public opinion against my client and slot machines at harness racing tracks,” she wrote. “Neither the public nor this commission are served well when they fall for these cheap political tricks.”

There has been no shortage of political gamesmanship since Nov. 4, when 53 percent of voters approved a measure to put slot machines at the state’s two harness racing tracks under certain conditions, including that a percentage of the revenue goes to specific state programs.

Weeks after the vote, Newman, still sitting on the lottery commission, agreed to run the Portland office of Capital Seven, the same Las Vegas developer behind the Bangor slots parlor.

As a consultant, Newman would head the Capital Seven-backed political action committee, Maine Opportunities, with the goal of stopping a competitor’s project in southern Maine.

Baldacci administration officials immediately objected to Newman’s dual roles, saying they presented a potential conflict by running afoul of the governor’s efforts to put stricter regulations on gambling in the state.

Perhaps the clearer conflict, some legislative leaders said, would be that the slot machines Newman’s client hopes to install would pull millions of dollars away from the state lottery over which she presided.

Upon learning of Newman’s resignation, Baldacci spokesman Lee Umphrey discounted any political motivation on the governor’s part. Instead, Umphrey said Baldacci is focused on crafting legislation to further regulate the gambling industry.

“The governor believes Mrs. Newman’s decision to resign … is the right one,” Umphrey said. “Any perception of conflict in this process is bad, and her resignation brings clarity in that area.”

Newman is not the only controversial hire in Capital Seven’s recent history. The company has hired at least two other working government officials in communities where they have attempted to open a racetrack casino.

In Bangor, Capital Seven owner Shawn Scott hired city Councilor David Nealley as the company’s executive vice president.

In Vernon, N.Y., where Scott owns the Vernon Downs racetrack, he hired the town’s code enforcement officer as a consultant, prompting an ethics investigation by the town council.