Saturday, May 10, 2008

Crackdown on bingo machines worries East Bay charities

East Bay charities that operate electronic gaming machines to lift their bingo parlor profits fear a sudden state crackdown this week on some games in Sacramento could spread — and slash a major source of nonprofit revenue.

The state Department of Justice for years had done little to enforce laws over what it considers illegal bingo machines that in some cases mimic slots — which only Indian tribes can legally operate on tribal land in California. State Attorney General Jerry Brown issued an opinion on electronic bingo in August, but some charity officials called it vague. With no enforcement, few stopped using the machines.

But the lack of enforcement ended Wednesday, when state agents launched a sweep of bingo halls known to operate the suspect machines. By Friday, agents had handed 30-day cease-and-desist orders to seven Sacramento-area bingo parlors and one in Southern California, Department of Justice officials said.

The department could seize machines if the charities fail to comply, the letter warned.

Many of the more than 300 bingo charities in California rely on the machines to salvage losses from a double hit: a decade-old smoking ban, and the explosion of Indian gaming into a $7 billion industry since California voters passed Proposition 1A in 2000.

Without its machines, "our charity will be significantly hurt and might not survive," said David Gibbs, executive director of the world class Concord Blue AdvertisementDevils drum and bugle corps, which supports 600 youths as well as a variety of school and community music programs. The charity gets about $250,000 annually — about 80 percent of its fundraising — from paper bingo and machines, Gibbs said.

"What it means is our programs get cut back, our teachers get cut back, the community is impacted," he said. "Short-term, we could probably make do. Long-term we wouldn't be able to compete."

Other charities in Oakland, Pleasant Hill, Albany and Antioch operate the machines, although it is unclear if the state will try to stop them.

Casino-owning Indian tribes, meanwhile, have long complained about the machines. Some tribes claim the lack of enforcement violates the terms of their gaming compacts and the monopoly they hold on slot machines and other electronic gaming devices in California. At least one tribe has threatened to suspend tens of millions of dollars in annual payments to the state.

Complaints have grown, and so has use of the machines, said Matt Campoy, acting chief of the state Bureau of Gambling Control, an arm of the state Department of Justice.

"More and more people were starting to believe that maybe it's OK (to operate the machines)," Campoy said. "We decided to take action to slow it down. Obviously, we're sympathetic toward the charities. But you can't conduct illegal business. It's illegal money."

Campoy said the enforcement would continue.

"A lot of the people we've been visiting, they knew we were coming," Campoy said. "They're kind of like, 'We knew this was going to happen, we just didn't know when.' "

A spokesman for a group of six powerful gaming tribes praised the state action. The group includes the Lytton Band of Pomo Indians, which operates more than 1,000 electronic bingo machines at the former Casino San Pablo site, which is now tribal land.

"The attorney general would not be out there delivering cease-and-desist orders if the state didn't feel they were violating the state constitution," said Doug Elmets, a spokesman for the California Tribal Business Alliance. "We realize the charities need assistance, but sneaking slot machines into bingo halls is not the solution."

Campoy, echoing an opinion from the Schwarzenegger administration, claimed that the machines used by bingo parlors are not slots, but that some are still illegal. According to Brown, bingo halls can use electronic "readers" to determine if a card is a winner, but not machines that substitute for bingo cards.

At the Veterans of Foreign Wars hall in Antioch on a recent night, dozens of bingo players sat at long white plastic tables, dabbing paper bingo sheets and also playing on black, computerized "Turbo Bingo" tablets. When the bingo caller dropped a ball, players dabbed their sheets and also entered the number into the electronic bingo "minders," which tracked hundreds of bingo matrices and sounded off when a player won. Other East Bay bingo halls use similar machines.

Those machines may be illegal, Campoy said, but the agency for now is targeting only more sophisticated machines that look and play like slot machines.

"In most cases, if they're not using paper, it's a strong possibility that they're illegal," he said. "Once the device is the major component of the game, you've changed the game."

Legalizing the machines for charity bingo halls would require a constitutional amendment, he said.

Gibbs, of the Concord Blue Devils, said it wasn't clear which of the charity's machines Brown might deem illegal. The charity has been running electronic bingo for about four years, Gibbs said.

Gibbs is treasurer of the California Charity Alliance, a newly formed group of about 40 bingo charities, that was pushing Friday for a meeting with Brown.

"We don't quite know what's happening," Gibbs said. "They're selecting certain machines the attorney general deems as not being legal. We just want a twig."

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