Slot machines are on, but money woes continue

Members of many Delaware fraternal clubs can once again pull up a seat to a slot machine, but club officials say they will have less money to put into the hands of needy vets and their families.

The state has issued licenses for fraternal organizations to operate up to 20 video lotteries per site, beginning March 1.  Slots machines had long been a major source of income for fraternal organizations in the state.

The machines were unplugged after many groups received a letter from Delaware State Police, saying the operation of slot machines was illegal.  The letter threatened to revoke liquor licenses for clubs that continued to operate the machines.

Delaware legislators passed a temporary bill in January, allowing fraternal groups to legally operate video lottery machines until Sunday, June 30, when state officials plan to have a permanent solution in place.

Delaware Lottery Director Vernon Kirk said 32 venues were licensed and notified they could turn on machines March 1; the state has issued 33 licenses total.  Kirk said six applications are pending, all from clubs that turned in applications in late February – later than clubs who have already received licenses.  “No venue has been refused a license to date,” Kirk said in an email.

At the Veterans of Foreign Wars Post in Rehoboth Beach, all 13 slot machines were plugged in March 1.  Quarter Master Tom Zalewski said the post received a letter Feb. 27 from Delaware Lottery, giving the thumbs-up to turn on the machines.

But conditions are not entirely back to normal.  The state of Delaware now takes 43.5 percent of the earnings from the machines.  “So unless I doubled the amount of people that played before,” Zalewski said.  “No, it will not bring us back.”

“We’re glad to have them back,” Zalewski said of the machines.  “But we’re just waiting, like everybody else, to see what the final bill is going to look like.”

Zalewski said the VFW lost about $6,000 a month from November 2012, when the letter from police was received, until March, when the machines were turned back on.  “Other than what we spend to keep the electricity on and salaries, we donate,” he said.

Zalewski said the VFW is planning to donate $3,000 to Fisher House for Families of the Fallen in Dover.  The post also awards cash prizes to winners of the annual Voice of Democracy Audio Essay Contest for high school students.

Post Commander Edward Tucker said the VFW has given the Delaware Veterans Home in Milford nearly $7,000 over the last two years. He said the post also sent cash to a Cape High student and member of the Cape Junior Reserve Officer Training Corps whose family’s home was destroyed in a fire.  “That’s what we’re here for,” he said.

But other regular donations had to be cut, such as an annual scholarship for students at Cape Henlopen High School, Zalewski said.  “We can’t do that this year,” he said.

Zalewski also said two employees at the VFW were taken off salary and now earn hourly wages.  Post hours were also cut from opening at 11 a.m., to opening at 1 p.m.  “We’re just looking at ways to cut costs,” he said.

Zalewski said the post might have to cut more hours, days and employee shifts.

“We’re a service organization, you know?  We’re a veterans’ organization,” Zalewski said. “We’re not going to be able to operate like we did before, with that 43 percent going to the state.”

Zalewski and Tucker said they hope permanent legislation will roll back the percentage owed to the state.  “It has to be done,” Tucker said.  “This post could not exist unless it’s a fair percentage to the state.”

Tucker said VFW Post 3238 in Camden removed its slot machines, and members plan to depend on other sources of revenue to fund operations, such as renting its hall for weddings and events.  Mark Newman, a member of the Camden VFW, confirmed the post has removed all slot machines.

“This place doesn’t have that,” Tucker said.  Smaller posts that do not have a hall, like the one in Rehoboth Beach, depend largely on the slot machine funds for operation and donations.

Tucker said 20 percent would be a fair cut for the state, but 43.5 percent is excessive.  “We’re not casinos,” he said.

“Cut the veterans a deal here,” Tucker said.  “We here just to help the vets, and right now we’ve got a lot of people hurting out there because of the economy.”

Legislators are expected to take up permanent legislation when the General Assembly reconvenes, Tuesday, March 12.