Minnesota Lottery chief quits amid travel inquiry

Updated: 4:34 p.m.

Minnesota State Lottery Executive Director Ed Van Petten abruptly resigned Friday following a media inquiry into his travel expenses and reimbursements.

The Star Tribune had reported that Van Petten received $7,000 in questionable reimbursements received while he and his staff stayed at his personal timeshares during conferences in Las Vegas.

On Friday, Van Petten told the Associated Press that the arrangement saved public money but conceded that it may have violated state policies governing employee expenses and offered to resign to save the Dayton administration potential embarrassment.

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Gov. Mark Dayton's chief of staff announced the resignation and said a search for a replacement will begin immediately.

Van Petten took over the Minnesota Lottery in 2012 after running the Kansas State Lottery for 11 years. Earlier this year, he wrangled with lawmakers over the agency's sale of lottery tickets at gas pumps and ATMs.

During a previously scheduled media availability, Dayton told reporters that he was concerned. He also said he would have asked for Van Petten to resign if he hadn't offered.

"If there are incidences of overspending in the lottery, we will look into that," Dayton said. "I don't want to characterize this because it's a matter of dispute. But any spending that's not within the strict accord of the rules and the law of the state of Minnesota is unacceptable."

Dayton said Van Patten's action did not meet the administration's standard of excellence, but he said he believes the lottery is well run. Dayton bristled at the suggestion that the incident is part of a broader fiscal management problem.

"We have extremely high standards of governance, of oversight, of audits," Dayton said. "The lottery is audited by a private firm. But it's audited on an annual basis, and this wasn't picked up until now. So, put it in perspective."

Dayton also took aim at reporters for focusing on negative news rather than positive stories, such as this week's low state unemployment number.

State lawmakers accused Van Petten of overstepping his authority when he added lottery games online, at gas pumps and at ATMs. They passed a measure earlier this year to halt those games.

State Rep. Sarah Anderson (GOP-Plymouth), chair of the House State Government Finance Committee, welcomed the lottery director's resignation. Anderson said Van Petten showed a clear lack of judgment.

"He should have been fully aware of what the requirements are under state law," Anderson said. "It doesn't pass the smell test for anybody quite honestly, just without having any rule in place. Even if the rule wasn’t in place, that did not reflect good judgement on his part to be reimbursed for his own personal dwelling space."

Anderson said she wants to hold hearings next session on the travel policies of all state agencies, to see if larger problems exist. In the meantime, she said the governor should freeze further out-of-state travel for the lottery as a first step in restoring public confidence.