
DATE: Tuesday, February 25, 1997            TAG: 9702250360

SECTION: LOCAL                   PAGE: B1   EDITION: FINAL 

SOURCE: BY MATTHEW DOLAN AND JUNE ARNEY, STAFF WRITERS 

                                            LENGTH:  144 lines

CHARITABLE GAMING BILL WOULD EASE REGULATION OF SMALLER BINGO GROUPS THE STATE WOULD CONTINUE TO OVERSEE MORE LUCRATIVE OPERATIONS.

As soon as the Virginia Charitable Gaming Commission took over statewide bingo regulation last summer, Indian River Pony Baseball League officials in Chesapeake said they started losing money at their weekly bingo games.

Because of tightened enforcement, children could no longer play the games with their parents.

``Half the people playing brought their kids, and those people stopped coming when kids couldn't play,'' said Jeff Crossland, president of the organization. ``One Friday we'd make $1,000, the next week it would be $200. .

Within months, the baseball association got out of the bingo business it had been in for 20 years.

The baseball league may have quit bingo too soon. Now groups like Indian River will be exempt from bingo regulations under the Gaming Commission - if the General Assembly has its way.

The legislature voted by wide margins Saturday to keep the commission alive until at least 1999, when it could review charitable gaming regulation again.

But starting this July, about 1,100 smaller bingo operations similar to Indian River's no longer would be subject to stateregulation if Gov. George F. Allen signs the bill.

While exempting smaller games - those with $25,000 or less in annual revenues - the bill would allow the commission to continue its oversight of more lucrative bingo operations. There are about 600 games statewide that make more than $25,000.

For the larger operations, the bill would gradually reduce a 2 percent yearly administration fee now paid on total bingo sales to 1.25 percent by July 1998.

During the next 30 days, the governor can sign, amend or veto the bill, said spokeswoman Julie Overy. Although the governor supported the exemption for smaller organizations, Overy said he would need to review the entire bill before making a decision.

Last week's legislative wranglings over the future of the commission coincided with the disclosure of a major bingo investigation in South Hampton Roads. The Charitable Gaming Commission is investigating allegations of bingo fraud at the Deep Creek Baseball Association by its former bingo manager. Its game took in more than $1 million in fiscal 1996.

Investigators also have targeted Deep Creek's Baltimore-based bingo supplier in connection with the alleged embezzlement of as much as $1 million worth of instant bingo tickets.

Scandal or not, charity gaming, which includes bingo and raffles, is no small business in Virginia. It rakes in about $215 million a year.

In South Hampton Roads alone, the 66 bingo operations that make more than $25,000 a year took in almost $50 million in the 1996 fiscal year, according to commission reports. Those groups spent about $3.7 million of that money on charitable purposes, everything from refurbishing old baseball fields to building new chapels.

Del. Alan S. Diamonstein, D-Newport News, who chairs a committee that reviewed the charitable gaming bill, said the legislation offered a compromise between those who tried to abolish the commission and those who defended its role.

``The bill tried to address some of the complaints that smaller groups had about the commission's cumbersome regulations,'' Diamonstein said.

Others protested that tinkering with a commission that has only been monitoring charitable bingo since the summer was ill-advised.

Del. Gerrauld C. Jones, D-Norfolk/Chesapeake, said he thought the General Assembly's action on charitable gaming was premature.

``I didn't agree with the weakening of the regulations,'' Jones said. ``I believe that in an area like bingo, you need very strict regulations, and we had to give the commission a chance to work.''

If the bill becomes law, organizations that expect to collect $25,000 or less a year, and all volunteer fire departments and rescue squads, will be freed from state regulation. Those groups will no longer need to notify the state of their gaming operations or fill out financial reports, according Jerry Rowe, the commission's executive secretary.,

Barbara Lifland, executive director of the Norfolk Senior Center, said bingo brings her center about $2,000 in profit from $9,000 in annual sales. The $2,000 represents about 5 percent of the center's total fund raising. The bingo money helps maintain a van used to transport senior citizens to activities.

Lifland said her agency was not one of the small fund-raising groups advocating changes to the commission.

``I never had problems with the regulations the way they were or the way they are now,'' she said, adding that she had not reviewed the new bill. ``I don't see that what's expected of us is unreasonable or burdensome.''

Children under 18, who have often been excluded from bingo halls under the state's existing rules, may find their way back inside.

Some bingo officials complained that the age requirement kept some families with children away. Under the bill passed by the General Assembly, those as young as 16 may be able to play. Under current rules, a player must be 18.

Children age 12 and over who are members of youth organizations engaged in bingo also may be able to volunteer at the gaming halls, Rowe said.

Daniel B. Moore, president of the Deep Creek Baseball Association, is happy that youths will be able to volunteer at bingo halls and play the game. Moore, who is still trying to sort out the allegations of embezzlement at Deep Creek, is happy that the Gaming Commission is going to be around for a while.

``I think the Gaming Commission needs to stay,'' he said. ``Chesapeake did a great job with the resources they had. I just think having experienced investigators is good. . . . It's difficult for a commissioner of the revenue to regulate it like they could.''

The bill also keeps a special exemption, which will affect only games in Hampton Roads. Cities in the Hampton Roads Planning District are the only ones in the state that can place entertainment and admissions taxes on bingo sales.

Some bingo managers, like Edward Redfearn Sr., believe that some regulation is necessary. Redfearn, treasurer of St. Nicholas Greek Orthodox Church in Virginia Beach and manager of its 12-year-old bingo operation, said when the commission took over, it added about an hour of paperwork a week to his job.

``Someone has to (regulate bingo) because there's so much money involved, and it's all cash, and it would become a mockery if someone didn't watch,'' he said. ``I always consider if the church is going to run it, we have to be absolutely above reproach.''

The church's total sales are more than $1.2 million. The resulting profit of about $150,000 a year is half the church's total fund raising, he said. Most of the bingo proceeds are going toward the construction of a new $600,000 chapel, expected to be completed by April 27 - in time for Greek Easter.

On bingo nights, the altar is closed off, chairs moved and 70 tables set up. It takes about 250 players to make a night of bingo profitable, Redfearn said.

``Any business that pulls in $5,000 to $15,000 a night in cash is suspect to theft and embezzlement,'' he said. ``It has to have good controls and watchdogs. . . . There's always going to be somebody who thinks they're smarter than the system.'' ILLUSTRATION: [Color photos]

BILL TIERNAN photos/The Virginian-Pilot

Annie Davis of Portsmouth is a regular bingo player at Tower

Auditorium. Charity gaming takes in about $215 million annually in

Virginia.

Rita Heitzer of Chesapeake plays ``decision bingo'' at Tower

Auditorium in Portsmouth. Participants pay 50 cents per game plus a

quarter for every three numbers called until someone gets bingo.

[Photo]

BILL TIERNAN/The Virginian-Pilot

From left, Belinda Hudson, Kay Rigdon, Leatrice Knight, and Ada

Holbert play ``decision bingo'' at Portsmouth's Tower Auditorium.

[Chart]