Veteran organizations fight to keep slot machines

Post leaders say Markell, casinos are targeting fraternal groups
American Legion Post 2 in Dover hosted a meeting of fraternal organizations from throughout the state, Nov. 26. SOURCE WLFOXPOST.ORG
November 30, 2012

Delaware veterans associations are faced with a dilemma: Cut off a major source of funding or face revocation of their liquor licenses.

Fraternal organizations across the state were notified by a letter from state police that operating slot machines – a major source of funding for operations and charitable donations – is in violation of state gambling laws.  The organizations are now battling to legalize the machines in time for the holidays, when they donate the highest amounts of money and goods to local charities and individuals in the community.

Some members of veterans’ organizations say the sudden enforcement is the result of pressure from Delaware’s three casinos.

The letter threatening enforcement, signed by Delaware Alcohol and Tobacco Enforcement Director John Yeoman and Delaware State Police Col. Robert Coupe, is dated Oct. 22, but organizations say they did not receive it until after the Nov. 6 election.  “Isn’t that a little telling?” said American Legion Post 2 Commander Jim Cole.

Yeoman said he had been out of the state at a training seminar and did not sign the letter until he returned Oct. 29.  He said about 150 letters were mailed and the time it took to certify and label each letter caused a further delay. Coupe announced he will retire from his position as superintendent Friday, Dec. 21.

About 80 people, including representatives from seven fraternal organizations across the state, attended a Nov. 26 meeting at American Legion Post 2 in Dover to discuss the problem.

Bessie Staab-Hickman, government relations coordinator for Maryland, Delaware, D.C. Moose Association, said she was upset media sources had not reported that Delaware State Police visited several organizations earlier this year to make sure they were in compliance.  “Most all of these places were visited this year,” she said. “My lodge was one of them.”

Staab-Hickman said she wanted to know why police had suddenly changed their tune.  “I think this was done on an agenda,” she said.  “The agenda is to give the state – or the casinos – total control.”

Jerry Melfa, a member of American Legion Post 17 in Lewes, echoed Staab-Hickman.  “This is a political fecal blizzard,” he said.

Melfa said he was told the enforcement letter stemmed from spousal complaints, and he asked if the state received spousal complaints about the casinos as well.  “The state wants the tax, and the casinos want us shut down,” he said.

Brian Selander, a representative of Gov. Jack Markell, said the governor’s office was not consulted before the letter was sent.  “The allegation that our office would in any way stop law enforcement from moving forward with a criminal investigation because of an election is as offensive as it is untrue,” Selander said.

Department of Safety and Homeland Security Secretary Lewis Schiliro said the state only became aware of illegal gambling occurring at fraternal organizations in the last year.  He said a combination of research, information from officers in the field and about six complaints from the public brought the activity to his attention.

“Continuing to look the other way is not an option for us,” said Schiliro, who oversees Delaware State Police.  “These machines are unregulated,” he said.  “Once we became aware of this, we had to deal with it in some way.”

Schiliro said veterans’ organizations do a lot of good for the community.  “This is not an attempt to impede that in any way,” he said.

There is currently no exemption in Delaware law to allow for gambling by nonprofit organizations; changing the law would be a legislative task, Schiliro said.

The organizations have been told legislation must be passed to change the law and allow the machines to operate, but the General Assembly does not convene until Tuesday, Jan. 8.

Thirteen Republican representatives wrote a letter to Markell, a Democrat, asking him to halt enforcement of the law until after the General Assembly convened, but Markell refused.

Veterans’ organizations say the tide change is already affecting operations. Cole said, “We had to lay off eight people immediately.  We had to change our hours.”

John Mitchell, vice commander of Veterans of Foreign Wars Post 7234 in Ocean View, said more people will be laid off and posts will be shut down by the time the General Assembly convenes.  “There are some posts here that are not going to be around on Jan. 8,” Mitchell said.  “Shame on the governor.”

Cole said all fraternal organizations should work together to find a solution before the start of the General Assembly.  “Obviously, this needs to be a concerted effort,” he said.  “What’s our recourse?  What can we do to turn these machines back on?”

Larry Waters, state commander of Department of Delaware Veterans of Foreign Wars, said he had attended four similar meetings since the letter was received.  He suggested all organizations band together and adopt a mission statement and strategy to allow gambling machines for nonprofit organizations.

Jim Gallagher, commander of American Legion Post 28 in Oak Orchard, called on attendees from American Legion, Moose Lodge, AmVets, VFW, Elks Lodge, Eagles and Delaware Veterans Association to appoint two people to join a committee that would work together on the issue in conjunction with state legislators.

“Let’s get this committee to start working tonight,” Gallagher said.

Sen. Brian Bushweller, D-Dover, who attended the meeting, said finding a solution before the start of the General Assembly is nearly impossible.  “There has to be legislation,” he said.

Bushweller listened to complaints, but he did not offer many answers to members’ concerns.  He said legislators and the governor were unaware of the letter until leaders at local veterans’ associations notified them.

Bushweller said the same situation came up 15 to 20 years ago, and veterans’ organizations were told the machines were illegal, but the machines were never removed.  “The police just sort of backed off the issue,” he said.

Bushweller said finding a compromise would not be easy.  “I would never want to tell you I can guarantee we’ll find a solution to the problem,” he said.  “Not everyone is jumping up and saying, ‘Let’s help the veterans’ organizations.’”

Bushweller urged those in attendance to contact their local legislators about the issue.  “When you get people talking, things will start to happen,” he said.

Gallagher said, according to the letter, arcades are also in violation of the law.

The Oct. 22 letter states, “If you possess machines that dispense cash or tickets, coupons or other tokens that are redeemable for something of value, you have gambling devices on your premises, and you are permitting gambling to occur.  You are in legal jeopardy.”

“Are you prepared to shut down the boardwalks?” Gallagher asked.  “Are they going to be held to the same standard as us?”

In a phone conversation, Yeoman said slot machines are games of chance; arcade games are games of skill and do not fall under the gambling law.

Gallagher said the state issued business licenses to the slot machine vendors.  “What did the state think those machines were for in the first place?” he asked.

Two vendors also spoke at the meeting.  Rita Falcone, owner of GGE of Delaware Inc., a West Rehoboth-based machine vendor, said vendors are not getting rich from leasing the machines to veterans, and she regularly gives donations to the organizations that rent machines from her.  “It doesn’t all go in my pocket,” she said.

In a conversation before the meeting, Falcone said vendors are also hurting from the state’s decision to enforce gambling laws at fraternal organizations.  She said she voted for Markell because he said he supported small businesses, but because of his inaction, she will have to lay off three employees before Christmas. “I’m going to have to lay people off.  This is 80 percent of my business,” she said.

“I guess no one complains when their husband loses their house from the legal casinos,” Falcone said.

When asked if the state receives complaints about the casinos, Schiliro said, “I’m sure people complain about losing money.”

“The casinos are regulated,” Schiliro said.  “We spend a lot of time in casinos.”

Ellen DeMarie-Schuman, who operates American Vending Corp. in Dover, said her father – a WWII veteran – began the vending business, and it has always supported veterans’ organizations.  “This is an emotional attachment as well,” she said.  “We are people who believe in our community.”

Both Falcone and DeMarie-Schuman received applause after they spoke.

Faron Marshall, clubroom manager of American Legion Post 14 in Smyrna said vendors have always supported the legion’s programs.

Marshall also said legislators should work with constituents even when the General Assembly is not in session.  “I don’t see why the governor is too good to come to a meeting,” Marshall said.

Senate to hear judicial nominations, Dec. 5

Gov. Jack Markell will call the Delaware State Senate into a special session to consider various judicial nominations at 4:00 p.m., Wednesday, Dec. 5, in Dover.  This special session of the senate will be the first meeting of either chamber of the 147thGeneral Assembly.

A Nov. 27 press release about the session made no mention any veterans’ issues would be discussed.

Markell will nominate Judge Eric M. Davis, currently of the Court of Common Pleas, and Chief Deputy Attorney General Charles E. Butler to fill two vacancies on Superior Court.  He will also nominate Deputy Attorney General Paula T. Ryan, who currently serves as chief prosecutor for Sussex County, to fill the vacancy on Family Court created by the removal of Judge John Henriksen.

Markell will nominate Vice Chancellor John Noble for reappointment to an additional 12-year term as a Vice Chancellor of the Court of Chancery.

Markell will also nominate Dawn M. Williams of the Office of the Public Defender and James J. Maxwell of the Department of Justice to fill two vacancies as Family Court Commissioners and the Honorable Lynne Parker for reappointment as a Commissioner of the Superior Court.


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