Are cash payouts on the way?

September 06, 1998|By DAVE McMILLION

CHARLES TOWN, W.Va. - As millions of dollars roll in from the newly approved video lottery games at the Charles Town Races, some state lawmakers are setting their sights on legalizing another form of gambling in the state, officials say.

Sen. Herb Snyder, D-Jefferson, and Del. Vicki Douglas, D-Berkeley, say they expect a bill to be introduced in the Legislature in January that would legalize cash payouts from video poker machines in private clubs and retail stores.

The machines are similar to video lottery machines, which Jefferson County voters approved for the Charles Town Races in 1996.

The video poker machines - sometimes referred to as "gray machines" because some people pretend they do not exist - are legal as entertainment in the clubs and stores. What is illegal is to have a cash payout.

Nonetheless, officials say, payouts are made frequently. Police have tried to crack down on the illegal activity, but the problem persists.


The possibility of changing the gray machine law already is striking a negative chord among some people.

Pastor Michael Withem, who helped lead a campaign against video lottery two years ago, said he warned the community about the proliferation of gambling if video lottery games were approved. He said the current talk of legalizing payouts from gray machines stems from nothing more than greed.

"The further down the road you go, the tougher it will be to turn the tide and come back. I'm not a prophet, but I know human nature," said Withem.

Del. John Doyle, D-Jefferson, responded, "That's nonsense. He is just simply plowing the wrong field."

Doyle, who is on a joint legislative committee studying gray machines, said the issue would have come up regardless of video lottery because gray machines pose a genuine problem to the state. Under the current situation, the state either is criticized for allowing illegal gambling or for failing to tax the winnings, he said.

Doyle said the committee has three options regarding gray machines: maintain the status quo, ban the machines, or legalize cash payouts and tax the winnings. He said one thing is for sure: There will be no more status quo.

The joint House-Senate committee, which is studying several gambling issues, including casino gambling at The Greenbrier resort in southern West Virginia, will make a recommendation to the Legislature in January, Doyle said.

State and local governments get a share of the video lottery profits from Charles Town Races and three other racetracks in the state.

Last year, the state-regulated machines generated $131.4 million. Since last September, Charles Town Races has generated $13.4 million in revenues from the machines, said Tacy Donovan, the state's video lottery coordinator.

"It's quite a transfusion," said Donovan.

Officials say it's hard to determine how many gray machines are in the three Eastern Panhandle counties. Statewide, it is estimated there are between 15,000 and 30,000 machines.

There have been efforts to curb illegal video poker gambling in the area through lengthy undercover operations. Former Berkeley County Sheriff Preston Gooden sent deputies into private clubs, where they received cash payouts for winning games on video poker machines.

Deputies then raided the clubs and confiscated the machines.

"There was a bunch of them," said Gooden. The machines were later hauled to a dump and destroyed, he said.

But the stings are the exception.

Berkeley County Sheriff Ronald Jones said one reason there are not more stings is because so many clubs have the machines. If police don't get all the machines that are being used illegally, it is not fair to the clubs that are raided, he said.

Private clubs had little to say about the debate over the machines.

Chester Hines, commander of the American Legion on Washington Street in Charles Town, declined to talk about possible legislation until a proposal is introduced. But Hines said he believes that if video gambling machines are approved for one industry, this should be extended to other places.

"If the track does it, I don't see why everybody else should be excluded," said Hines. He said there are a couple of gray machines in his club, but they are not popular.

If cash payouts were allowed for poker machines, Douglas said she wants to make sure there are restrictions on where the games can be placed.

Douglas said she just returned from a trip through the Carolinas and was not impressed by what she saw.

She said everywhere she looked there were people huddled in little buildings playing slot machines. Sheds and porches were enclosed and turned into gambling operations, she said. Some buildings looked as if they were put together quickly, and weren't even painted, she said.

Children stood nearby while adults played the machines, she said.

"It did not warm my heart. I don't want that for West Virginia," Douglas said.

If games with cash payouts are allowed, perhaps they can be limited to places that have liquor licenses, which set certain requirements for minors, she said.

Snyder said he is not enthusiastic about the idea of cash payouts from gray machines.

"I'm leaning against it at this point, and don't believe it is a good idea. That's a big step for the state of West Virginia," he said.

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