Stop DC Gambling

Postscript: The 2:17 a.m. bill

2012-02-12T18:08:00.000Z

Prior to taking the full council vote on repeal of the District's Internet gambling law, the Finance Committee produced a report on the matter.

The report points out that the bill authorizing Internet gambling, approved by the District Council in December, 2010, "was not circulated until 2:17 am the day of the initial vote."

The report goes on to say: "Even if members were aware of the last minute change, it is unlikely that they were able to take the time to fully educate themselves on the issue prior to being asked to cast an initial vote on the measure. Further, questions were raised as to the advisability of enacting a potentially controversial measure in this manner, which did not allow for residents and other stakeholders to express their views through a formal hearing process."

The legislation allowing Internet gambling was subsequently approved with no debate.

The council last week reversed that decision, voting 10-2 to repeal the law.

(For a PDF version Google Docs, click here)

District of Columbia Finance Committee Report

About the repeal

2012-02-10T00:11:00.000Z

The District’s Council deserves thanks for repealing the Internet gambling law.

This law should have never been adopted without public hearings, committee reviews and careful consideration by the community. Clearly, for a law as important as this one, the process didn’t work the way it should have.

Councilman Jack Evans and the Finance Committee, in particular, deserve credit for taking steps to correct this. The committee held a roundtable last year to begin discussion on this matter. It asked D.C. Lottery to hold ward-by-ward community meetings and it followed this with the recent public hearing on the measure.

This law was expansive. It would have brought casino-type gambling into homes and bars, restaurants and hotels. It would have created new risks for families and neighborhoods. It would have hurt people
.
The District would have been hurt as well. There were many unanswered questions about how the law would work.

There was no discussion, for instance, on whether the gambling age should be raised from 19 to 21. It’s 21 in Nevada.

There was nothing in the law limiting the number of neighborhood sites that could be created for gambling.

There were no limits on the types of the games. Some argue, for instance, that Internet gambling should be limited to so-called games of skill, such as poker.

There was no contingency made for addressing problem gambling, other than to limit losses to $250 a week.

There was no oversight body, no gaming commission or lottery board, created by this law to monitor and regulate the operation. There were no regulations.

By repealing, the Council, in the end, showed that the process can work.

Here's what they didn't share about D.C.'s plan

2012-01-21T17:54:00.000Z

“You're all late for tea!” -- Says The March Hare, as he throws his teacup in the movie version of Alice in Wonderland.

The Washington Post headline today about the D.C. inspector general report on Internet gambling reads as if the District was exonerated for its handling of this issue.

“No legal, ethical wrongdoing in D.C. Council lottery, inspector general concludes,” writes The Post.

This headline is discouraging and there are worries that it might settle the thinking on this issue.

“It needs to be purified by someone with evaporating skills, or it will fester and putrefy,” said the Mad Hatter.

Indeed. There are things that have happened that people don’t know about, and here’s the biggest one of all: On March 30, 2010, the District signed a contract with its gaming contractor, Intralot that outlines, in great detail, Internet gambling in D.C.

It was kept quiet. Had people known about this contract, the entire history would have been different.

Consequently, we were all late for the tea party that came ten months later. This was in December, 2010, when D.C. Council approved Internet and neighborhood gambling in DC, without so much a word from the public.

The council members supporting this contract decided that the best thing, from an ethical point of view, was to not bring this to the public’s attention.

This contract was a platform for debate, a debate this community was not allowed to have.

But the public was denied its voice ethically, the IG points out.

What was not seen or heard

The “scope” of the contract included development of a “game management system incorporating internet lottery and scratch games as well as poker, bingo and backgammon interactive game engines.”

Let’s look at some of the most wondrous issues.

College students, the young, it’s all money

Since D.C. will have one of the lowest legal casino betting ages in the country, 19, young people will be a lucrative target market.

To accommodate this age group fantasy leagues will be offered, and games like “Super Goal,” which is a virtual shoot out of a soccer featuring realistic representations of two teams. The betting aspect involves around such things as picking the final score of the game, and picking the total number of goals achieved by both teams, according to the contract.

Another youth oriented game is “Naval Attack,” which sounds lot like Battleship. Players win by picking various outcomes, such as the exact number of ships hit by bombs.

Not just homes, bars and restaurants but mobile, too.

The contract authorized “Internet player membership” that “authorizes a customer to play interactive games over internet and optionally mobile channels.”

When did the District government decide that gambling should be available on “optionally mobile channels?”

Hopeful thinking credit card provision

The contract allows payment through “bank accounts, debit cards, and/or credit card.”

Everybody wins!

What this contract describes is gambling ecosystems where people not only gamble online, but also connect with third party merchants through advertisements.

Since the District’s plan also calls for the creation of physical casinos in bars, restaurants, hotels, coffee shops and other establishments, these establishment can then, in turn, advertise gambling promotions on the player portal, such as free drinks for gambling.

The D.C. Office of Casino Boss

The competitive issues are staggering. Here we have a government agency, D.C. Lottery, going into the casino gaming business, accepting third party advertising, and then pitting neighborhood casino “hot spots” against bars and restaurants that don’t allow gambling.

Should Internet gambling have been a separate bid?

The Post reports that the IG criticized the CFO’s office for “adding Internet gambling provisions to the contract without issuing a written notice that the underlying contract requirements had changed an allowing another round of bids from interested companies.”

“Because of this,” The Post reports, the CFO “may not have received the best price for the District.”

“That is an excellent practice,” said The Mad Hatter.

It’s hard, from the contract, to tell exactly who makes what. But it does include this provision: Intralot will be compensated at 50% of the Net Gaming Revenue … (see page 18 on the PDF).

What is clear is that if the District had sought new bids for its plan to allow people to gamble from their homes and from neighborhood bars and restaurants, the public may have learned what’s up.

Instead, the gambling issue was pushed down a rabbit hole.

“Who's to say what is "proper"? What if it was agreed that "proper" was wearing a codfish on your head? Would you wear it?” said Alice.

A PDF of the contract

DC Lottery Contract March 30 2010

About the gambling hearing

2012-01-20T01:00:00.000Z

COUNCIL MEMBER JACK EVANS, CHAIR, COMMITTEE ON FINANCE ANDREVENUE’S

PUBLIC HEARING ON: The Matter of i-gaming andBill 19-474, the “Lottery Amendment Repeal Act of 2011”

Thursday, January 26, 2012
10:00 a.m. until end or 1:00 p.m. recess, resuming at 6:00 p.m.

Room 412 - John A. Wilson Building, 1350 PennsylvaniaAvenue, NW; Washington, D.C. 20004

Those who wish to testify shouldcontact Sarina Loy, Committee Assistant at (202) 724-8058 or

sloy@dccouncil.us

Please support therepeal of the DC internet Gambling bill not to be against gambling, butbecause the Lottery Modernization Amendment Act of 2010 is a bad bill that putsthe District of Columbia government and its citizens at high financial exposureand security risk. The legislative process was bad, and the bill producedby the process is bad, therefore it needs to be repealed now and rewritten as stand-alone legislation that can bethoroughly vetted in an open and fully transparent manner with proper publicconsideration, comments, hearings and recorded vote by the Council of theDistrict of Columbia and approval/signature of the Mayor.

· The District’s potential financial exposure (includinghacking and criminality, potential lawsuits, and non-compliance with federallaws, banking regulations and agencies) is greater than the $13 million averagein revenue that officials are estimating.

· TheDistrict’s security exposure includes software infiltration andmanipulation, and potential mass identity thefts of DC citizens’ socialsecurity numbers that are required for player accounts.

· A bad process: Online/Internet gambling/iGamingincluding computerized slots legislation was quietly inserted into the December 2010 budgetwithout public discussion or public hearings, contrary to the principles ofopen and transparent government.

· A bad bill: Internet Gambling in DC canbe about whatever the Chief Financial Officer (CFO) says it will be, so itdoesn't matter what the CFO or Lottery Director says today, because they canlegally do whatever they want tomorrow.

· The types of games that can be played includepoker, bingo, blackjack, roulette, backgammon, dice, fantasy sports leagues,and slots-like games.

· Participating bars, hotels, restaurants andcoffee shops can operate as neighborhood casinos, potentially until 4AM, withinunlimited locations as determined by the CFO, and with no legal publicnotification requirements.

· iGamblingtargets children, young people, andcollege students with fantasy sports games and easy access to the systemthrough laptops, smart phones, play stations, and ipads.

Church group opposes D.C. gambling

2012-01-19T04:23:00.000Z

Mayor Vincent Gray
The Wilson Building
1350 Pennsylvania Avenue, NW
Washington, DC 20004

Dear Mayor Gray,

   The Council of the Downtown Cluster of Congregations wants to express to you its unanimous opposition to any implementation of internet gambling in the city (as discussed and determined at its meeting of Dec. 15, 2011).

   The concerns are several. First, the expansion of gambling activities in the city is not considered to be productive for strengthening the lives of local residents and advancing their well-being and the public's overall safety. It is unclear what lasting and meaningful economic benefit will accrue to D.C. residents from this proposal, and indeed, may well result in the contrary. While new revenues and fees will likely be generated for the D.C. government, many congregations and their clergy and pastoral staff are aware of the deleterious, and often tragic impacts gambling can have on the lives of those who become addicted to it. The city government should be putting its efforts and resources into more tangible initiatives to bring jobs to the city for local residents. The need for increased city revenues is understood but other means should be undertaken to achieve that goal.

   Further, there is significant concern over how this initiative has reached this point and as to whether there has been adequate public input into the proposal. It is quite appropriate that the City Council will be holding a public hearing on this matter on January 26th in order to hear from the public, and hopefully provide a better explanation of all of its ramifications, who are the stakeholders, and how the proposed venture will impact the city.

   Your goal to increase city revenues is understood and appreciated, as are your efforts to expand economic opportunities for District residents and businesses. Expansion of gambling - specifically internet gambling - is not the way to build safer and better neighborhoods.

Respectfully,
Terrance Lynch
Executive Director

An unanswered question about the gambling bill

2012-01-18T02:17:00.000Z

The District’s gambling bill was approved as a budget rider in Dec. 2010. By taking that path, its proponents avoided public hearings.

Why did proponents decide to avoid hearings?

There is no good answer. But it is clear that the gambling bill could have been introduced as free standing legislation many months prior.

The emails, below, from May 2010 between members of CM Brown and CM Evan’s staff make it clear that there was discussion about possible legislation. A free-standing bill was also suggested.

At the end of the memo chain is what appears to be the text of draft legislation. The complete document isn’t available. The proposal seeks to give D.C. Lottery the ability “to update its games and maintain competitiveness.”

That bill was never introduced in May, 2010 and the gambling issue never surfaced until Dec. 2010, when a bill was introduced and then quickly adopted.

Many months following these events, gambling bill sponsor CM Michael Brown discussed the legislative history in a letter to the ANCs. For him, this legislative history begins in December, 2010 – nine months after these memos.

In this letter, written earlier this year, Brown wrote in part:

“I briefed my colleagues at the Council breakfast meeting prior to first reading, where members of the press were present. In early December, several media outlets reported on the provision.” (See this post and this one for background)

What Brown is describing is the first public appearance of the gambling bill. The time between the initial press reports and law’s passage was less than a month.

There was no reason for this speed.

The District approved a contract on March 30, 2010 with Intralot that allowed new types of gambling in the District.

This contract helped to put into motion a plan to bring online gambling and neighborhood casinos to the District. Had the media seen this contract, District residents may have had time to consider this proposal.

Reporters might have asked: Why is the District approving a contract that allows for creation of things like an “e-Wallet,” and development of “IP blocking policies.”

Reporters would have asked about the planned “Player Portal.” (This portal is described in the March 30, 2010 contract this way: The proposed solution provides a web portal framework and web page templates that can be used to quickly deploy an interactive gaming Web site.)

Nobody asked about the contract. But the plan to bring online gambling to the District was very much in the works.

What the District’s gambling proponents needed was enabling legislation. And that’s what these emails are discussing, nine months before legislation sneaked in.

Please click to enlarge:

About D.C.'s $250 gambling limit

2012-01-17T00:58:00.001Z

D.C. Lottery plans to limit gambling losses to $250 a week or $13,000 a year. That limit will likely hurt the amount of money that the District can make off online and neighborhood casino gambling.

According to Marvin Steinberg, the executive director of the Connecticut Council on Problem Gambling, problem gamblers are responsible for a major share of gambling revenue.

In a recent op-ed he wrote for the Hartford Courant, Steinberg pointed this out:

… problem and pathological gamblers account for approximately 30 percent of gambling revenue despite being only about 5 percent of all gamblers.

Problem gamblers lose far more than $13,000 annually, according to the Wisconsin Council of Problem Gambling's annual report.

The Post Crescent, a newspaper which wrote about the council's annual report, said the council helped 13,528 people last year. The average reported debt for the people it helped was $157,074, the newspaper reported.

The Wisconsin council estimates that approximately 333,000 Wisconsin residents have a gambling problem, or 5.8% of Wisconsin's population of 5.65 million. Nevada cites a 6% rate.

The $13,000 yearly limit that D.C. Lottery and the CFO have proposed is intended to reduce the impact of problem gambling on the community.

But since the D.C. government, via its lottery, will be promoting gambling and making it available just about everywhere, it's probably safe to say that problem gambling will be an issue of emerging importance to the community.

For most people, $250 is a lot of money. The fact that D.C. Lottery feels it needs to set a limit tells us that they expect a problem. But everyone still comes up a loser under this plan, which is yet another reason for repeal.

Making the case for repeal: Reckless lawmaking

2012-01-16T19:48:00.000Z

There are many reasons why the District’s new online gambling should be repealed, but let’s start with the process that led to the law’s adoption.

In December, 2010, the District council approved legislation that will bring online gambling into homes, bars, restaurants, hotels, coffee shops – almost anyplace imaginable.

District officials worked on this plan for more than a year, and even prepared draft legislation in the Spring of 2010.

Although the proponents of this law had ample opportunity to submit online gaming as a free-standing bill, they refused to do so and, instead, attached the legislation as a rider to the budget.

On the eve of adoption, Peter Nickles, who was then the District’s attorney general, wrote a letter to the District’s elected officials with concerns about the proposal.

Nickles letter concludes: In sum, with no detailed on-line gaming implementation plan for review, no feedback from the public gained through public hearings, and no hard answers to a bevy of thorny legal issues, the Council nevertheless appears to be poised to pass the Lottery Modernization Act of 2010. For the record – and, more importantly, for the District’s sake – I hope that the legislation proves to be worth the gamble.”

Nickles offered clear caution to lawmakers who then ignored it. It was a reckless action on their part and an affront to the community.

They can correct this mistake, restart this process, and air the issues openly by repealing this legislation.

To read the letter, click on the images to enlarge.

Is Gambling More Addictive Online?

2012-01-02T18:10:00.000Z

Above is the headline of a recent story in the Hartford Courant about online gambling.

Massachusetts recently approved several casinos to compete with Connecticut's casinos. Connecticut estimates that Massachusetts casinos could reduce Indian gaming payments to the state by up to 25% or approximately $95 million annually.

Connecticut is now considering deployment of online gaming to offset those losses.

Connecticut, over the years, has had Jai alai, dog racing, and horse race betting via off track betting parlors. In the mid-1980s, it reached a deal with Native American tribes to offer casino gambling the state.

Connecticut’s casinos have been money-makers, in part, because Rhode Island and Massachusetts, as well as New York City, have not allowed casinos.

The prospect of online gambling in Connecticut is worrying some.

The Connecticut Post, in an editorial wrote:

While adults have the right to make their own decisions, it's a fact that a certain percentage of the adult population has a problem with gambling. If it's fair to say that opening up new avenues for gambling will increase revenue for the state, then it's also fair to say that it will create new opportunities for those who have a problem.

The research on the impact on problem gambling is still new. The Courant interviewed some psychologists about it.

Researchers have studied the psychology of gambling for decades. The field of online gambling research, though, is still new, and researchers say there are a number of questions about its potential dangers and whether online gambling poses psychological problems different from those related to traditional forms of gambling.

Nancy Petry, a psychologist at the University of Connecticut, said a few patterns have so far emerged. "We're finding that only a small proportion of gamblers do so online, but of these people, the vast majority do have gambling problems," said Petry.

Internet gambling repeal hearing Jan. 26

2011-12-30T14:54:00.000Z

The District's Committee on Finance and Revenue, which has oversight over the D.C. Lottery, will hold a hearing Jan. 26 on a bill to repeal the Internet gambling law.

The public is allowed to testify at these hearings. Details are below. You have until Jan. 25th to sign-up, although it's recommended that you do it earlier.

If you can't testify in person, you can nonetheless submit a written statement to the committee.

This is the first public hearing to be held on Internet gambling. The District approved its Internet gambling measure in Dec. 2010 as a budget rider. The law was approved without public hearing or committee review.

This law is not the result of a sudden revenue-raising brainstorm by its proponents, but was part of a calculated effort to keep the public in the dark for as long as possible about the District's plans to introduce Internet gambling. District officials had been in talks for many, many months -- if not more than a year -- with its lottery contractor about the plan to create mini-casinos in neighborhoods as well as allow Internet gambling from home.

This is the hearing notice:

Council of the District of Columbia
Committee on Finance and Revenue
Notice of Public Hearing
John A. Wilson Building, 1350 Pennsylvania Avenue, N.W. Washington, D.C. 20004
________________________________________

COUNCILMEMBER JACK EVANS, CHAIR
COMMITTEE ON FINANCE AND REVENUE

ANNOUNCES A PUBLIC HEARING ON

The Matter of i-gaming
and
Bill 19-474, the “Lottery Amendment Repeal Act of 2011”

Thursday, January 26, 2012
10:00 a.m. until end or 1:00 p.m. recess, resuming at 6:00 p.m.

Room 412 - John A. Wilson Building
1350 Pennsylvania Avenue, NW; Washington, D.C. 20004

Councilmember Jack Evans, Chairman of the Committee on Finance and Revenue, announces a public hearing to be held on Thursday, January 25, 2012 at 10:00 a.m., in Room 412 of the John A. Wilson Building, 1350 Pennsylvania Avenue, N.W., Washington, D.C. 20004. The hearing will continue until all witnesses have testified or 1:00 p.m. and will recess. The hearing will resume at 6:00 p.m.

As a follow up to the June 29, 2011 Public Oversight Roundtable on the matter of i-gaming, the committee is providing another opportunity for the DC Lottery and Charitable Games Control Board to provide an update on the series of community meetings held in the fall of 2011, as well as implementation efforts of i-gaming in the District of Columbia. This measure was included in Title VII, Subtitle G. Lottery Modernization Act of Bill 18-1100, the “Fiscal Year 2011 Supplemental Budget Support Act of 2010,” which is now Law 18-370.

Bill 19-474, the “Lottery Amendment Repeal Act of 2011” would amend the Law to legalize Lotteries, Daily Numbers Games, and Bingo and Raffles for Charitable Purposes (DC Law 3-172) to eliminate online gambling.

The Committee invites the public to testify at the hearing. Those who wish to testify should contact Sarina Loy, Committee Assistant at (202) 724-8058 or sloy@dccouncil.us, and provide your name, organizational affiliation (if any), and title with the organization by 10:00 a.m. on Wednesday, January 25, 2012. Witnesses may specify whether they would like to testify at the 10:00 a.m. portion or the 6:00 p.m. portion. Witnesses should bring 15 copies of their written testimony to the hearing. The Committee allows individuals 3 minutes to provide oral testimony in order to permit each witness an opportunity to be heard. Additional written statements are encouraged and will be made part of the official record. Written statements may be submitted by e-mail to sloy@dccouncil.us or mailed to: Council of the District of Columbia; 1350 Pennsylvania Ave., N.W.; Suite 114; Washington D.C. 20004.

Here's the story on DC Lottery's gaming contractor

2011-10-31T20:56:00.000Z

The company that has 51 percent equity in D.C. Lottery’s operation is a little known firm called Veterans Services Corp. (VSC)

What role does VSC play?

Intralot, a Greece-based gaming company, won the city’s $38 million lottery contract in 2008. Council members wanted Intralot to have a local partner. That partner became Veterans Services Corp. in 2009. According to the Washington Post VSC holds 51 percent of the equity in the joint venture running day-to-day lottery operations.

VSC was formed in 2009. It was just starting out when inspectors from the District of Columbia Department of Small and Local Business Development conducted a site visit as part of the District's business certification process.

The document below was the result of inspection in August 2009.

VSC was approved as part of the lottery contract by the District Council in Dec. 2009, less than four months later.

VSC describes itself, in documents to the District, as “a professional services consulting and professional staff augmentation company.” It says it can deploy staff with security clearances, and people with skills such as “certified information systems auditors.”

VSC, along with Intralot and D.C. Lottery, will be running gambling system that delivers poker, bingo, blackjack, and slots to District residents, and in bars, restaurant and hotels in neighborhoods.

Among its skills, the company said on government documents that "VSC has an extremely strong IT practice providing a wide range of services, including; Network Security, Systems Migration and Deployment, Network Operations, and Data Base Management. VSC technical programming expertise, includes, but is not limited to: VBA, UNIX, SAS, SQL, etc.".

What the District inspectors found, was an operation being run out of home that lacked records. And despite that technical expertise cited by VSC, the site visit report by the District's inspectors found that of the company’s had two Dell computers and “one was not working properly.”

The city’s site visit report also includes some check-off sections, Y/N and N/A (non applicable.)

It found:

Bookkeeping and other record keeping – N

Payroll Maintenance – N

Receipt of business telephone calls and phone – N

Receipts evidencing payment of telephone service by the firm - N

According to city records, VSC was certified Aug. 28, 2009 for two years.

Here is the document

Click to enlarge

There's more: for the full document PDF click here

D.C. Lottery's high limit slots

2011-10-29T16:23:00.001+01:00

The new Internet gambling law approved by the District Council, a law adopted without public hearing, committee review or real public notice, will give the D.C. Lottery enormous ability to expand its predatory gambling practices.

This law gives D.C. Lottery the power to determine the types of games it wants to deliver to the public. This is why it is putting in slots and bingo, along with poker.

Remember, the argument proponents raise in support of Internet gambling is that the District loses gambling tax revenue to offshore venues. Proponents of gambling in D.C. describe the typical offshore gambler as a poker player with middle to above incomes. By offering poker, supporters of the law said D.C. will recover lost tax revenue and extend consumer protections to people now betting offshore.

So what happens next?

D.C. Lottery officials outlined a plan intended to draw in a broader demographic by offering bingo and slot-type games. They want new types of gamblers to play their games, people who have never played offshore games, people who probably don't even know they exist.

D.C. Lottery wants to expand Internet-based gambling to fixed income seniors and lower income populations by offering bingo and slots and who knows what other magical online games. D.C.'s large college-age population will be a target as well.

In the new Internet gambling law, D.C. Lottery also has the power to determine where neighborhood mini-casinos are located and how many of them can be established. The law, itself, sets no limits, no safeguards, no oversight. The regulator is the D.C. Lottery.

When it comes to consumer protection for neighborhoods, there is none.

In Las Vegas they have separate areas where people can play "high limit slots." Typically, those machines are at least $5 and above. The higher the bet, the higher the payoff. But that brings a higher margin to the casino, and that's what D.C. Lottery is interested in.

The Council's new Internet gambling law puts D.C. Lottery on the path to becoming a corporate sociopath.

District Council members have been willing enablers of this mess, approving a law under the public radar and then giving lottery officials the ability to do just about whatever they want.

Ward One Internet gambling meeting Nov. 1

2011-10-27T02:19:00.002+01:00

Here's a note posted about it on the Adams Morgan list:

D.C. Lottery will be holding a community meeting on the new Internet gambling law on Tuesday, Nov. 1 at the Marie Reed Learning Center, 2200 Champlain St. NW, 6:30 p.m. to 8:30 p.m

These meetings are being held in each Ward to inform people about some of the implications of a new law that allows Internet-based gambling in homes, restaurants, bars and hotels.

Here are the major points to consider:

-- Last December, the District Council approved as a budget rider. There were no public hearings or committee reviews. Public notice was minimal.

-- D.C. Lottery is now implementing the law. It will grant licenses, without oversight, to bars and restaurants to allow gambling from 10 a.m. to 4 a.m. daily in neighborhood establishments. Patrons will be required to bring their own PC. But if gamblers become a larger share of a businesses revenue, it is possible that some of these establishments may cater to gamblers, creating what amounts to neighborhood gambling parlors. In time, it’s entirely possible that bars and restaurants will find the means to make terminals and tablets available for patron use.

-- This law will expand problem gambling. Originally, proponents said it was aimed at poker players who bet offshore. But D.C. Lottery plans to offer bingo and slots, or an electronic version of its scratch games, as well as poker, via the Internet. Clearly, D.C. Lottery’s intent is to expand gambling to new populations, and rake in as much revenue as possible.

-- Will gambling bring in new tax dollars? Not necessarily. Money lost to gambling is money not spent locally.

There are many other issues and implications. It is a first in the nation law and it represents a major expansion of gambling. It was a law adopted without any public input. It is a law operated without any public oversight.

The Adams Morgan ANC 1-C recently voted to ask the District Council to repeal this law. The Kalorama Citizens Assn., voted similarly at its meeting this week.

Attend the meeting, hear the details, and decide whether this is what you want for our community.

Adams Morgan ANC opposes DC gambling law

2011-10-22T18:07:00.001+01:00

The Adams Morgan ANC (1C) voted this month to oppose the District’s Internet gambling law.

I attended the meeting and had been waiting for the official resolution before publishing something but don’t have it yet. The measure, which ask the District Council to repeal the law, was approved by voice vote. One commissioner abstained for reasons that weren’t stated.

The repeal proposal was led by Martis "Marty" Davis (1C-02) who chairs the Public Service and Environment Committee.

At the meeting, Davis said the plan to have Internet gambling in the District hadn’t been vetted or thought out very well.

“This is a formula for foolishness,” said Davis of the law.

From the discussion, it appeared the leading motivation for opposing this law was around the process that led to its adoption, namely the lack of hearings and committee review. The Internet gambling law was included as a budget rider and approved last December without hearings.

Commission Chair Wilson Reynolds (1C-07) believes the law will not be repealed by the council. He argued for an alternative approach. “Control this,” said Reynolds, “and restrict this to hotels.”

Reynolds had previously raised the argument at public service committee meeting that the best approach would be approve a resolution to limit gambling to hotels of 100 rooms or more.

Davis believed the hotel restriction would break down over time.

The public service committee and the ANC offered me ample opportunity to make a case for opposing this law, and I’m grateful to them for it. But, honestly, it didn’t take much argument. It seemed apparent that the commissioners had many questions about the law and the changes it might bring to the neighborhood.

Information Fact Sheet Supporting Sample Repeal Resolution

2011-10-21T01:23:00.000+01:00

A. What Is Internet Gambling and How Did It Become DC Law?

Internet Gambling or Igaming is gambling on a DC owned website to play games of skill and chance and to buy lottery tickets.
The District of Columbia Government with its full faith and credit is the first government in the US to support, own and operate Internet gambling. Internet gambling has been through private companies usually operated offshore.
In 2008 the Chief Financial Officer issued a competitive bid for a new contractor for the regular lottery. That process took over one year. Unknown to the public, almost all of the Council Members and even the losing bidder, GTech, the winning team was awarded a contract with an option for a computer platform to include online gambling in March 2010. DC did not even have a law allowing online gambling when the contract was signed.
Nine months later, a City Council Member inserted legislative language which allows any type of gambling into the December 2010 Budget Supplement. There were no hearings with any public comment. The budget supplement was signed by the Mayor in January 2011. It then went to Congress as the entire budget supplement and since there were no Congressional objections Internet gambling became DC law in April 2011.
All decisions about what games are offered are being made by two DC Government officials—Dr. Natwar Gandhi and Mr. Buddy Roogow. There is no longer a board of directors or member appointees to the DC Lottery Board. It is run by the executive director, Mr. Roogow who makes $157,000 per year. Mr. Buddy Roogow lives in Maryland and told the media that he has no intentions of moving into DC. The DC Lottery is an independent agency and the executive director does not have to live in DC.
The contract was won by DC09, a DC LSDBE company which was formerly Veterans Service Corporation of Virginia. The CEO of DC09, the majority contractor is Emmanuel Bailey who also lives in Maryland. The winning subcontractor providing the trademarked platform is Intralot, a foreign company headquartered in Greece.

B. What Games Does the DC Internet/Intranet Platform Provide?

1. The contract signed with DC09/Intralot includes an Intralot owned B-ON™ platform capable of: 1. On-line Lottery games 2. Interactive Lottery games 3. Numerical games 4. Instant ticket games 5. On-line interactive fixed-odds betting 6. Fixed-odds betting 7. Live betting 8. On-line interactive casino games 9. Table casino games 10. Video Lottery games 11. On-line skill games 12. Betting exchange on skill-based entertainment games 13. Instant tickets with skill-based entertainment games.

2. On April 21, 2011 Mr. Roogow testified at the Lottery budget hearings before the Council that the online gambling would start with Texas Hold Em Poker, Victory at Sea and bingo. Within two months in the June 17 DC Register and at the June 29 Roundtable, Mr. Roogow announced that the online gambling supported and operated by the DC Government includes the additional games of random number generated games (slots), blackjack and electronic instant tickets.

3. Mr. Roogow states that DC will not go into the business of casino gambling. But there are no laws or legislative history which prevents Gandhi/Roogow from doing this according to legal opinions provided by their lobbyist in January 2010 as long as it is INTRASTATE.

C. How Will It Work?

1. In order to comply with federal law all players will have to play inside the city limits. This is the key to whether or not this type of gambling is legal according to testimony given by DC Attorney General Irvin Nathan. DC Attorney General Irvin Nathan also stated that he is keeping the Department of Justice informed of the implementation planning.

2. When a player logs into the DC website the IP address will indicate the location of the laptop or computer within one or two blocks according to Mr. Roogow. The DC Lottery states that they will create a buffer around the District lines to prevent anyone using a wi-fi router at home to play whose laptop is in Maryland or Virginia. They may black out one to two blocks at the District line to prevent out of state users.

3. All players will have to be over 19. According to several interviews given by Mr. Roogow and the DC Lottery web page they will use several filters to determine the age of the gambler.

4. The person playing will purchase a debit card for $250 or less and start playing on a weekly basis. It is not clear if the money escrowed will be controlled by DC09, Intralot or directly by the DC Government. It is assumed that it will be controlled by the DC CFO’s office. This amount is arbitrary and can be changed by Mr. Roogow any time.

5. The first roll out includes computerized slots. The difference between a computerized slot and video computerized slots which were stopped by Dorothy Brizill, of DC Watch and others twice in the past is difficult to describe. The video slot is a computerized specialized piece of equipment which was to be purchased by the owner of a casino. At this point it is not anticipated that this will happen but it is allowed by the December 2010 law as long as it complies with the federal law known as the Johnson Act. Video slots have only one purpose and are not manufactured within the City limits. On the other hand someone’s laptop has many purposes and is usually purchased by the owner. It is the laptop which will be registered along with its owner with the DC Lottery.

D. What Are the Expenses And Economic Issues?

1. DC09 and Interlot are paid a fee just to implement the regular lottery system which was budgeted at $33 to $38 million over 5 years. DC09/Intralot will also share in the profits of online gambling. “Profits” for the DC Government to share are made when many people lose money. There are also public documents which indicate that DC Lottery may be paying additional costs once the online portion of this contract goes live.

2. All of the financial indirect impacts have not been considered and planned for and affected agencies have not signed off. The hours of operation are until 4 AM every day. DC agencies such as the Alcohol Beverage Control Administration, the MPD, or addiction treatment centers have not estimated their financial costs.

3. THE REVENUE ESTIMATES PER YEAR ARE NOT INCLUDED IN THE DC BUDGET BY THE CFO FOR FOUR YEARS.

4. The CFO could not provide reliable information and used only foreign government historical financial information to project the revenue because this is the first time a US government is running this type of business. Therefore, there could be no reliance on the projected income of about $3 million per year.

5. As stated the additional direct expenses are also unknown. One clue might be picked up on the DC Lottery web site which states they have retained the services of IBM Managed Security Systems to prevent national and international hacking of the DC Government site. The DC CFO, Lottery Director, Chief Technology Officer, City Administrator and DC Attorney have been asked for the policy and procedures which will be followed should there be any successful compromises to the system. No response has been given.

6. The impact on the retail regular lottery stores is unknown. It is unclear at this point but the DC Register seems to indicate that this new system is offering the ability to buy online lottery tickets. Further, there may be problems with retail stores becoming “hotspots” such as a mini market which currently sells liquor and will be setting up tables/chairs to allow clients to sit down with their laptops and gamble. There may be issues requiring liquor license amendments, zoning and fire safety inspections and parking enforcement.

E. Where Will Players Be Allowed to Play and Where Will “Hotspots” Be Located?

1. The home part of the system is on track and will be operational in October 2011 according to the Lottery website.

2. After complaints at the June 29 roundtable the Lottery issued rules giving ANC’s 60 days notice to comment on proposed “hotspots.”

3. “Hotspots” are secured sites where it seems that terminals will be supplied. It might be a secured site in a business which already has a wi-fi website such as certain well known coffee shops. A player will go into this “hotspot” with a laptop or iPhone and be able to connect to the Igaming site owned by the DC Government and start gambling. No one knows where these sites will be but this is totally controlled by Dr. Gandhi and Mr. Roogow.

4. Federal government employees will not be allowed to play on this website. The law requires that no lottery activities including advertising can take place in the federal enclave. Some interpret the governing law to mean any federal building. For example, US Homeland Security is on Massachusetts Avenue near American University in Northwest surrounded by residential zoning. Mr. Roogow told an editorial board member of the Washington Post that they will build buffers around federal government buildings. It is envisioned that a one or two block dead zone will be created around such buildings.

5. At the roundtable on June 29, Mr. Roogow confirmed that it was possible to have gambling in a room in the Wilson building and an article appeared in the Washington Post that this could be true of DC libraries. The DC Intranet website or DC H-Net which DC taxpayers have paid millions to build will be used by the Lottery to run the gambling site. There is no legislation or legislative history since there has been no hearing that requires the DC Lottery to exclude libraries, recreation centers and schools which are hooked up to this Intranet system. It stands to reason that these entities will be excluded but this is all up to Mr. Roogow and Dr. Natwar Gandhi.

F. Is Home and “Hotspots” Online Gambling A Good Idea To Be Implemented by 2011?

A number of our District elected officials are now under investigation for ethics violations, corruption, and possible criminal activities. The process by which Online/Intranet gambling/Igaming with computerized slots was adopted in the middle of December without any public sunshine contributes to the negative perception among DC residents that our government is increasingly controlled by outside interest groups. Further, should anything go wrong especially within the federal enclave it will damage our quest for DC voting rights.
Mr. Roogow is promising many things like checking to see if there are particular gamblers who are addicted and blocking them. This office has not received budget authority to hire anyone new and Mr. Roogow stated in an interview that he needs to hire an expert cyber auditor. There is no money for this. So this office must run the paper lottery and this new huge business line without any increased staff.
D.C. Government will be the first Government in the US to operate online gambling with no rules and regulations and case law history.

How To Get Further Information?

1. Marie Drissel, Ward 2 prepared the Q&A and worked with several people to refine the sample repeal resolution. Angela Christophe, Ward 4, Mike Ivey, Ward 4, Andy Litsky, Ward 6 and Patrick Thibodeau, Ward 1 are helping to distribute the resolution and informational fact sheet.

2. A website/blog at Stopdcgambling.com has just been established.

3. For any comments please email marie.drissel@verizon.net

4. Public outreach meetings have been scheduled from August 16 until September 15, 2011 by the DC Lottery.

5. The first meeting is for all ANC Commissioners on August 16 from 7 to 9 PM at the DC Lottery on MLK Avenue. http://www.dclottery.com/AboutUs/igaminginfo.aspx

DC Lottery Cancels Ward 6 Home/Hotspot Gambling Listening Tour with One Day Notice

2011-10-20T15:03:00.000+01:00

Dear Councilmembers,

I received a call moments ago from Charles Allen in Tommy Wells' office. He was just told that the Ward Six i-Gambling community meeting that was scheduled for this Thursday -- tomorrow -- has been moved by Buddy Roogow to next Thursday. No messages regarding this change ever went out from the Lottery Board to any Ward Six organization -- none of the Ward Six ANC commissioners -- none of the Ward Six community listservs -- and none of the customary Ward Six websites.

After being called on the carpet by the media for scheduling their community meetings in the middle of August and over Labor Day, once again the Lottery Board is tampering with the process that they themselves established. If Buddy Roogow and his Lottery Board crew can't be trusted to maintain a simple schedule of community meetings, how can they be trusted to run a citywide gambling operation? Flying way under the ethics radar screen, they are either wildly incompetent or too cute by half and boldly believe that can get away with no supervision.

The Council needs to step up to the plate and exercise some oversight. And while it may be fine to some that Buddy Roogow, as a Maryland resident, pays no DC taxes -- someone needs to remind him that his salary is being paid by the residents of the District of Columbia and that he still reports to the Council's Committee on Finance and Revenue.

Sincerely,

Andy Litsky

Commissioner, ANC 6D-04

Primer on Internet Gambling in DC

2011-09-28T14:17:00.004+01:00

This guide, in the form of a helpful grid, offers some of the basics on DC Internet gambling, the contracting, the time line, the cost, and who actually manages it.

Click on image for larger view, then click on it again to enlarge it.

For some, it may be easier to view this in Google Docs. To do so please go here.

Evans seeks IG review of Internet gambling

2011-09-27T13:59:00.001+01:00

It’s difficult to decipher where Councilman Jack Evans stands on Internet gambling in the District. He has been critical of the adoption process and has raised questions about its contracting. He wants community meetings and a public hearing on the proposal. But Evans has not come out for repeal of this measure.

Evans, however, has asked the Inspector General to review the awarding of the D.C. lottery contract of 2009, as well as the iGaming – the code word for Internet gambling – provision.

In a letter to Inspector Charles Willoughby, Evans wrote this on Sept. 6:

As we discussed in our telephone conversation last week, you stated that your office is actively investigating the awarding of the DC Lottery contract in December of 2009. You also stated that your office is considering the i-gaming (Internet gambling) option and the circumstances surrounding its passage in your investigation.
I concur that your office should include i-gaming in your investigation.

The complete letter from Evans is available here.

ANCs at opposition to DC's gambling law

2011-09-26T13:00:00.000+01:00

Three ANCs have, so far, passed resolutions opposing the District's Internet gambling law. They are ANC 2D, which represents Sheridan-Kalorama; ANC 6D, which includes the Southwest/Near Southeast community, and ANC 4C, which represents the Petworth area, 16th Street Heights and a portion of Crestwood.

The ANC 1C-Public Service Committee, which represents Adams Morgan, is scheduled to take the issue up on Wed. Sept. 28. Its action may be a prelude to consideration by the entire commission in early October.

The ANCs don't have a lot of power and, as their name implies, they are advisory. But their members are on the front-line of neighborhood issues and they will be the ones who will be dealing directly with the impacts of neighborhood mini-casinos.

Here is the resolution approved by ANC 2D:
ANC 2D RESOLUTION 2011-08

Resolution Regarding Online/Internet Gambling/iGaming

Whereas the Online/Internet Gambling/iGaming, including computerized slots legislation, was inserted into the December 2010 budget without public discussion or public hearings, contrary to the principles of open and transparent government;

and

Whereas the potential negative economic impacts associated with bringing online gambling supported and operated by the District of Columbia Government everyday until 4AM may include increased police protection, alcohol beverage control, zoning and fire safety enforcement, specialized protection against hacking of the DC Government website and its gambling site, and increased addiction treatment vastly outweigh the projected annual financial benefits to the District that might be realized by its implementation.

Now, therefore let it be resolved that ANC2D fully supports the immediate repeal of the “Lottery Modernization Amendment Act of 2010” and a moratorium on the implementation of DC Government Online/Internet Gambling/iGaming, including computerized slots, so that this issue in stand alone legislation can be thoroughly vetted in an open and fully transparent manner with proper public consideration, comments, hearings and recorded vote by the Council of the District of Columbia and approval/signature of the Mayor, and

Be it further resolved that the Chair or his designee be authorized to represent the Commission on this matter.

Attested by:

David R. Bender, Chair

September 19, 2011

This resolution was approved by a roll call vote of 2-0 on

September 19, 2011, at a scheduled and noticed public

meeting of ANC2D at which a quorum was present.

FOIA filed with Office of Small and Local Business Development Concerning Questionable Actions/Procedures in Awarding Joint Venture LSDBE Points to the 2009 Online Gaming Bidders

2011-09-26T12:25:00.000+01:00

During the 7 hour joint Council hearing on November 24, 2009 called to order by Chairman Vincent Gray, Committee of the Whole and Chairman Jack Evans, Committee of Finance and Revenue, all joint venture bidders to the online gaming request for proposals were sworn in as witnesses. After testimony by the winning bidder and losing bidders, the CFO Contracting Officer, Joseph Giddis also testified under oath.

Although requested by Chairman Gray, no staff representative from the Office of Small and Local Business appeared nor did the Chair of the appointed board appear despite several calls for an appearance made during the seven hour hearing. One of the major issues pursued during this hearing was to discover what happened within the DC Government entity, Department of Small and Local Business Development concerning all 3 teams’ application for local, small, disadvantaged or LSDBE designation. There was not a single minute of discussion about Igaming or games of skill such as poker. The contract was awarded on December 1, 2009 which was the first legislative session after this hearing.

The FOIA below was filed Friday, September 16, 2011 with Robert Summers, acting FOIA officer according to a telephone call made to this office in the morning. A copy was also send to Harold Pettigrew the Director of this office. The FOIA officer’s position is vacant.

Dear Mr. Summers:

Under the DC Freedom of Information Act, I am requesting the following information:

1. Veterans Service Corporation and Veteran Service Corporation joint Venture with Intralot

A. NIGP industry classification codes (National Institute of Governmental Purchasings Commodity Services Code) or codes relating to industry for all registration periods after 2007 to present claimed by both Veteran Service Corporation and joint venture of Veterans Service Corporation and Intralot.

B. The documents which support the award of NIGP industry classification codes for both Veteran Service Corporation and joint venture of Veterans Service Corporation and Intralot.

C. All information supporting certification in any class such as disadvantaged, small business and local business from 2007 to the present for both Veteran Service Corporation and joint venture of Veterans Service Corporation and Intralot.

D. Documents used to support ownership structure from 2006 to the present for both Veteran Service Corporation and joint venture of Veterans Service Corporation and Intralot.

E. Documents used to support joint venture between Intralot and VSC from January 2009 to the present for both Veteran Service Corporation and joint venture of Veterans Service Corporation and Intralot.

F. Documents supporting recertification in 2009 and 2011 for both Veteran Service Corporation and joint venture of Veterans Service Corporation and Intralot.

G. All employment verification of Rebecca Mattingly by both Veteran Service Corporation and joint venture of Veterans Service Corporation and Intralot.

H. At the November 24, 2009 Joint City Council hearing at 4 hours and 22 minutes, CM Catania was told by Emmanuel Bailey, who is a principal officer of VSC, that an executed joint venture had been signed between VSC and Intralot as of the hearing date.

I. On November 24, 2009 Mr. Emmanuel Bailey stated that VSC would employ 71% of its employees from DC. All documents which pertain to their promise concerning DC employment by both Veteran Service Corporation and joint venture of Veterans Service Corporation and Intralot.

2. DC09 and Joint Venture with Intralot (Note: DC09 according to DCRA was incorporated in the District of Columbia on March 29, 2010)

A. NIGP industry classification codes (National Institute of Governmental Purchasings Commodity Services Code) or industry for all registration periods after January 2010 to present claimed for both DC09 and joint venture of DC09 and Intralot.

B. The documents which support the award of Industry classification codes for both DC09 and joint venture of DC09 and Intralot.

C. All information supporting certification in any class such as disadvantaged, small business and local business from January 2010 to the present for both DC09 and joint venture of DC09 and Intralot.

D. Documents used to support ownership structure from January 2010 or prior to January 2010 (from November 24, 2009) to the present for both DC09 and joint venture of DC09 and Intralot.

E. Documents used to support joint venture between Intralot and DC09 from January 2010 to the present for both DC09 and joint venture of DC09 and Intralot.

F. Documents supporting recertification in 2011 if required for both DC09 and joint venture of DC09 and Intralot.

G. All employment verification of Rebecca Mattingly by both DC09 and joint venture of DC09 and Intralot.

H. At the November 24, 2009 Joint City Council hearing at 4 hours and 22 minutes, CM Catania was told by Emmanuel Bailey, that an executed joint venture had been signed between DC09 or possibly VSC and Intralot as of the hearing date. All documents verifying this joint venture and certification received by this office.

I. On November 24, 2009 Mr. Emmanuel Bailey stated that DC09 or possibly VSC would employ 71% of its employees from DC. All documents which pertain to their promise concerning DC employment by both DC09 and joint venture of DC09 and Intralot.

3. Joint Venture between GTECH and Patton/Green/Woodson/Wiggins and Digidocs

On November 24, 2009, testimony was given before the DC City Council at a Joint Hearing Chaired by Chairman Gray and Committee Chair Jack Evans by Doug Patton, attorney; Roderick Woodson, attorney and William Rye, Williams and Connelly concerning their experience trying to attain LSDBE certification. Significant dates concerning their issues on the City Council hearing tape are June 26, July 16, August 3, October 13, October 27 and November 10.

A. All documents, decisions, electronic messages concerning the lack of award of any points to the above entities—GTECH, Patton, Green, Woodson, Wiggins, Digidocs and minutes, notes or electronic communications concerning the significant dates above. The archived City Council meeting tape was on November 24, 2009 and the portion outlining the actions of the both the staff and board is contained in the first two hours and ten minutes.

B. NIGP industry classification codes (National Institute of Governmental Purchasings Commodity Services Code) or codes relating to industry for the registration period for 2009

C. The documents which support or did not support the award of Industry (NIGP) classification codes.

D. All information supporting or not supporting certification in any class such as disadvantaged, small business and local business from 2009 through 2010

E. Documents used to support or not support ownership structure in 2009 and 2010

F. Documents used to support or not support joint venture between GTECH and Patton/Green/Woodson/Wiggins and Digidocs.

4. Metropolitan Gaming and the Joint Venture of Metropolitan Gaming and Scientific Games

A. NIGP industry classification codes (National Institute of Governmental Purchasings Commodity Services Code) or codes relating to industry for all registration periods after 2008 to present both for Metropolitan Gaming and the Joint Venture of Metropolitan Gaming and Scientific Games

B. The documents which support the award of Industry classification codes both for Metropolitan Gaming and the Joint Venture of Metropolitan Gaming and Scientific Games from 2008 to 2010

C. All information supporting certification in any class such as disadvantaged, small business and local business from 2008 through 2011 both for Metropolitan Gaming and the Joint Venture of Metropolitan Gaming and Scientific Games

D. Documents used to support ownership structure from January 2009 to the present both for Metropolitan Gaming and the Joint Venture of Metropolitan Gaming and Scientific Games

E. Documents supporting recertification of Metropolitan Gaming between 2009 and 2011.

I am a citizen activist and am not doing this for any commercial use. I am asking for a wavier of all fees.

Should you have any questions, I can be reached on 202-xxx-xxxx.

Thank you for your cooperation.

Marie Drissel

Catholic Conference Expresses Concern

2011-09-20T00:06:00.002+01:00

The D.C. Catholic Conference has issued a letter that raises concerns with the plan for Internet gambling.

The complete letter follows below.

September 9, 2011

The D.C. Catholic Conference expresses concern with the D.C. Lottery and Charitable Games Board’s recent proposal to offer games of skill and games of chance via the internet. I-Gaming, as it is known, will be the first online gambling program in the nation.

Games of skill and games of chance are not in themselves inherently wrong. However these games become morally problematic when they interfere with an individual’s obligations and/or deprive a person of what is needed to meet his or her needs and the needs of others. (Catechism of the Catholic Church, 2413)

If properly controlled, gambling can provide legitimate recreation for those who participate responsibly. However, gambling can also contribute to unhealthy behaviors including addiction which can lead to other societal ills. Gambling potentially threatens the common good by taking time and resources away from those who provide care and support for their children, families, and dependents.

The Church is concerned that I-Gaming may impact poor, elderly, and vulnerable people in a disproportionately negative way. I-Gaming’s implementation raises serious questions in this regard and its possible consequences should be carefully considered before it is made publicly available.

The D.C. Catholic Conference welcomes the decision of the D.C. Lottery and Charitable Games Board to hold community ward meetings to explain the proposed program in detail. The Conference urges the Board to integrate measures addressing the concerns of the community before any implementation.

The DC Catholic Conference represents the Catholic Church’s public policy interests on issues affecting the people of the District of Columbia. For more information, please contact info@dccathcon.org.

(A PDF version.)

Continued Response to Brown’s Letter to ANC’s Council Member Michael Brown Briefed all Council Members on Igaming Yet Declares He Is Not an Expert on Kojo Nnambi Show

2011-09-19T13:57:00.000+01:00

In a letter dated September 16, 2011 to all Colleagues including ANC Commissioners concerning numerous media accounts and gross misstatements by a few vocal members of the public opposed to Igaming, Council Member Michael Brown stated: “I briefed my Council colleagues at the Council breakfast meeting prior to first reading, where members of the press were present.”

The first reading of the new Modernization law known as Igaming or Internet gambling was placed into the FY2011 Budget Supplement Support Act on Dec. 7, 2010. Brown offered the breakfast briefing as proof that the modernization law was properly vetted. There have been no public hearings, including no government officials presenting sworn testimony.

Brown appeared on the Kojo Nnambi show for 16 minutes on April 14, 2011 only four (4) months later and admitted six times that he was not an expert and did not know the answer to several key questions. At the breakfast meeting prior to the first reading the entire Council and according to him the media in attendance depended on his being a complete expert since there were no hearings and therefore no expert witnesses presenting testimony under oath.

The transcript is provided by WAMU Radio.

Question: “Where are the hotspots likely to be located? If I wanted to play poker from home, would I be able to?”

Brown Answer: You absolutely would be able to play from home. You could also play probably, I imagine, in hotels and certain restaurants downtown and some of the part of the core areas of the city. But yes, you will absolutely be able to play in the comfort of your own home.

Question: “What kinds of technological measures will the city be taking to make sure people outside the District won't be able to access D.C. online poker?”

Brown Answer: “Only because I'm not a technical engineer so I can't answer (laugh) in the kind of way you probably would like, but the technical -- technology does exist where you can keep it within the borders. Keep in mind, Kojo, people are playing online poker today as we speak and have been for the last couple of years. It hasn't -- it's not being regulated. We cannot get fees from it. Now, we can regulate it and we can get fees, so it's kind of a good, good story for the residents of the District of Columbia relative to increasing revenue.”

Question: “I'm thinking of people who live in Takoma Park, D.C. How do they know that their neighbors in Takoma Park, Md., aren't honing in on this?”

Brown Answer: “Excellent, excellent point. And that's where the technology will have to get tweaked 'cause it's not just Takoma Park on Eastern Avenue, it's also Western Avenue, it's -- all the big border streets, because within 500 feet or so, there could be some issues, but the technology people will work on it and I'm sure it will get fixed.”

No questions; continuing comments:

“We are watching just busloads of people every day going to West Virginia, Delaware, Maryland, to play other kinds of games. We had to do something here. And we're gonna put a lot of controls. We're gonna have educational efforts. The Lottery Control Board is gonna have educational efforts about the dangers of gaming. So we're gonna do everything we can to make sure that we don't hurt anybody in this process.”

Question: “And following up on that, will those entrepreneurs be able to integrate other entrepreneurs who can set up gaming facilities in their own restaurants? And what will be the process to, like, get a license to have a computer setup in your bar, for instance, where somebody can game?”

Brown Answer: “Well, I'm not sure how exactly they'll have it set up, but they -- I don't even know if they'll start with Intralot. I think they have to start with the Lottery Control Board here in the District of Columbia. That's really the overseeing body that regulates lottery and game playing here in the District of Columbia.”

Continuing comments: On the method for entrepreneurs for getting involved and getting a license

A lot of the implementation side -- my job is the legislator. I got the law passed to make sure it was legal. On the implementation side, they should contract the Lottery Control Board. They will have all the answers to those questions for him.

A response to Brown's letter to the ANCs

2011-09-18T17:40:00.000+01:00

The sponsor of the bill authorizing Internet gambling and mini-casinos in District neighborhoods, Councilman Michael Brown, sent out a letter Sept. 16 to the ANCs defending his proposal and correcting what he terms as “gross misstatements by a few vocal, yet misinformed, members of the public” about the plan to expand gambling in the District.

What follows is a brief summary of some of Brown’s major points in his letter to the ANCs. To see the councilman’s full letter, please go here.

What Brown claims: The councilman argues that “the iGaming provision was properly vetted through Council procedures” similar to other measures. Moreover, Brown says he briefed council colleagues at a breakfast prior to adoption and cites articles that appeared from Dec. 7 through Dec. 9, 2010, in the Washington Post, Washington Times and other publications.

Response: The District adopted this law in its supplemental budget about two weeks after those articles appeared. That was hardly sufficient notice. There was no public hearing on this legislation or opportunity for public comment. Although this legislation had been in the works for months prior to these initial news reports, its adoption was clearly engineered to minimize public notice. Brown has no defense here.

What Brown claims: The councilman argues that his gambling plan won’t hurt the poor. “Many have alleged that iGaming will most detrimentally affect the poorest and most vulnerable of our residents. This is not the case,” writes Brown. In order to gamble on the Internet “a player must have a bank account, a computer and an Internet connection. Our neediest residents generally do not have all three items,” he writes. Further, argues Brown, “the limited amount of research on the demographics of individuals who play online games shows that the majority of players make in excess of $60,000/year.”

Response: Gambling will be allowed at restaurants, bars and hotels as well as in the home. It’s not entirely clear, based on what’s been disclosed so far, just how the financial aspects of this plan will work. What is known is that gamblers will have to set up a gambling account and will be limited to $250 a week. They will have to use debit cards. But will gamblers be required to use a debit card that links directly to a bank account? Will they be able to purchase a debit card (think gift card) to use instead?

Brown suggests that someone who is poor may not own a computer. But why will anyone need to bring a computer to a bar, restaurant or hotel to gamble? What’s to stop a business from making computers available to patrons? The legislation doesn’t prevent a business from supplying a patron with a computer, and the DC Lottery’s FAQ is silent on this issue.

Brown argues that online gaming attracts people with higher incomes. But he is comparing people who use offshore operations against an entirely new enterprise: A government sponsored and promoted online gambling operation. This is not a fair comparison, and it is one of the reasons why this legislation needed far more public scrutiny than it received.

One other point: Among the games that DC Lottery plans to offer is bingo. Is this the type of game that is aimed at high-income earners or fixed-income seniors?

What Brown claims: Brown argues that the law will not lead to the creation of gambling parlors. He writes: “It has been alleged that so-called iGaming hotspots are tantamount to ‘gambling parlors’ full of gaming terminals. This is not true.”

Brown says that “there will be no gaming terminals in the District of Columbia, as this is prohibited by Federal law. All iGaming will be played on a personal computer.”

Response: There is nothing in this law, as pointed out earlier, to prevent a bar from making a personal computer or tablet available to a patron. A bar could lease or rent a PC to a customer who is then free to use it for Web browsing or for gambling. The PC isn’t being specifically supplied as a “gaming terminal,” but it could be used as one, and that is the key point.

How will gambling parlors emerge? A bar or restaurant that gets a license to offer a gambling “hot spot,” will be able to operate it from 10 a.m. to 4 a.m. each day. These businesses may begin to draw in new types of customers specifically interested in gambling. As bars and restaurants gain more revenue from gambling-focused customers, these businesses will naturally want to cater to these customers. This is how mini-casinos may emerge in neighborhoods.

What Brown claims: “I do not support any type of slot-machine gaming in the District of Columbia. I have made my position very clear to the Mayor and the Director of the DC Lottery. This legislation does not authorize the installation of any type of slot machine or gambling device in the District of Columbia.”

Response: Brown’s statement sounds heroic, but it is a gross misstatement of the public record. The councilman already pointed out in his letter that federal law bars gambling-specific devices. What Brown fails to note is that DC Lottery plans to offer an electronic version of slots online.

Councilman Jack Evans held a public roundtable in June on the legislation. A DC Lottery official was asked about slots. The Washington Post reported:

“Do you expect to be offering slot machines?” asked council member Tommy Wells.
“Yes,” responded Buddy Roogow, the lottery chief. After a moment, Roogow added: “They do not meet the legal definition of slot machines. They are in fact random number-generated machines.”

Brown’s letter to the ANCs only adds to the case that this is a bad law. It helps to define the questions and to expose the areas that need more examination, such as whether this law will increase gambling addiction in the District.

Although the public and the ANCs were not given a chance to ask questions and express views before adoption of what is clearly major legislation, efforts to establish online gaming appear well in place.

Mayor Gray, who has been largely silent on this law, appears to be supporting it and it’s unclear whether the council’s opponents have enough votes to repeal this bill.

It’s distressing and utterly depressing that the District’s government has taken a path that will lead to no good end for District neighborhoods and its citizens.

CFO Gandhi Has the Full Power to Fold The Game

2011-09-02T14:50:00.000+01:00

Here is the Lottery Modernization Law

The lottery language was included in the FY 2011 Supplemental Budget Support Act (B18-1100). The relevant language is below. It authorizes games of skill and chance. It is now up to the DC Lottery and Charitable Games Control Board to promulgate regulations and determine which games to offer. The independent Executive Director of the DC Lottery reports to the independent Chief Financial Officer. There is no longer a Board of the DC Lottery.

SUBTITLE G. LOTTERY MODERNIZATION ACT

Sec. 761. Short title.

This subtitle may be cited as the “Lottery Modernization Amendment Act of 2010”.

Sec. 762. Section 4 of the Law to Legalize Lotteries, Daily Numbers Games, and Bingo and Raffles for Charitable Purposes, effective March 10, 1981 (D.C. Law 3-172; D.C. Official Code § 3-1313), is amended as follows.

(a) The existing section is designated as subsection (b).

(b) A new subsection (a) is added to read as follows:

“(a) A lottery or lottery game means both games of skill and games of chance that are operated by and for the benefit of the District of Columbia by the Board; provided, that:

“(1) If the games of skill and games of chance are offered via the Internet, any technology employed for the play shall confirm the play to be at all times within the District; provided further, that the restriction shall not apply to the conduct of fantasy sports and sweepstakes-style games if such games are lawful; and

“(2) No method, media, or device for play of the games of skill and games of chance shall violate An Act To prohibit transportation of gambling devices in interstate and foreign commerce, approved January 2, 1951 (15 U.S.C. § 1171 et seq.), or any other federal law.”.

(b) A new subsection (c) is added to read as follows:

“(c) The Board, through the Chief Financial Officer, pursuant to Title 1 of the District of Columbia Administrative Procedure Act, approved October 21, 1968 (82 Stat. 1204; D.C.

Official Code § 2-501 et seq.), may issue rules to implement the provisions of this section, and may establish which games may be offered and additional terms and conditions for the conduct of the games not inconsistent with subsection (a) of this section, including the percentage of wagered amounts to be retained by the Board, minimum and maximum wagers, and time limitations for the games.”.

Definitions, timeline, and major players

2011-09-02T00:16:00.003+01:00

DEFINITIONS:

The only RFP competitively bid by the CFO's office was for "online gaming." "Online gaming" in the simplest definition refers to the telecommunications aspects of the 400 to 600 DC lottery terminals for the purpose of purchasing lottery tickets for games of chance. It has nothing to do with Igaming. The improvements which were being sought by DC Lottery were for the regular lottery. Igaming [if in caps it is a trademarked word belonging to Intralot] or Internet gambling is totally different. In the simplest definition it refers to DC home poker/slots gambling and DC hotspots poker/slots which are games of skill and chance. This internet gambling is DC Government policy with the full faith and credit of the DC Government backing it. The home poker/slots is the first internet based gambling sponsored and run by a government in the US.

Online gaming = DC lottery terminals only
Igaming or Internet gambling = DC homes and DC designated hotspots.

TIMELINE AND MAJOR PLAYERS:

PHASE ONE -- WHAT WAS MORE OR LESS IN THE PUBLIC EYE

Online Gaming referring to the 400 to 600 lottery terminals only

2007
May competitive bid for online gaming issued, bidders
GTECH/LManning and Intralot/Warren Williams Jr/SR

Dec award to Intralot/Warren Williams Jr/Sr

2008
Jan Decision by CFO contracting office sent to CFO Gandhi for Council transmission

Apr 7 Council Hearing panelist CFO contracting officer Eric Payne, Jay
Young, interim Executive Director, DC Lottery; Ann Walker Marchant representing
her father, George Walker and in person Leonard Manning of Lottery Technology
Corporation which had partnered with GTECH challenging decision of
Intralot/Warren Williams Jr/Sr
NOTE NOT A SINGLE WORD WAS MENTIONED OF INTERNET
GAMBLING OR Igaming DURING THE THREE HOURS OF HEARING

Oct CAB ruled on LTE challenge of GTECH plus LTE without merit

2009
Jan Eric Payne, former CFO contracting officer fired now suing DC Government

Unkn Contract rebid respondents, 1. GTECH with Patton, Green, Wiggins, Woodson and
Digidocs; 2. Scientific Games with Hopkins (Metropolitan Gaming) 3. Intralot
with no partner

Nov 24 (Correction: initially this date was listed as Nov 19) Seven hour hearing by contractors attacking the process. At this hearing irregularities were discussed about lack of LSDBE designation of the GTECH group and the final points given to Scientific Games with Hopkins which were described as lower then it should have received. At this hearing Emmanuel Bailey represented Veteran Service Corporation as a majority interest with Intralot
NOTE NOT A SINGLE WORD WAS MENTIONED OF INTERNET GAMBLING OR Igaming DURING THE SEVEN HOURS OF HEARING

Dec 1 City Council vote, Mendelson no; Gray/KBrown abstain; Bowers
present, MBrown, DCatania, JEvans, JGraham, MCheh, HThomas, TWells,
YAlexander, MBarry yes
Discussion included the fact that VSC was now part of the contract but there
was no evidence that the joint partnership had received a LSDBE designation and
no evidence that a contract had been signed by the parties
NOTE NOT A SINGLE WORD WAS MENTIONED OF INTERNET
GAMBLING OR Igaming DURING THE 15 MINUTE DISCUSSION

PHASE TWO -- WHAT WAS NOT IN THE PUBLIC EYE

Igaming or Internet Gambling [B-ON™ Intralot platform]

2010
Jan to March extensive email traffic showing CM Michael Brown or his staff
assisting in the negotiations with CFO’s office and Intralot and DC09 a totally
different platform, B-ON™ aka Igaming, Internet gambling in DC homes and DC hotspots

Mar 29 DC09 is incorporated in DC; do not know if the joint venture was given
a LSDBE (will research within one week)

Mar 31 contract between DC09 as majority stock holder and Intralot is signed by
CFO or CFO's contracting officer to include B-ON™ or Igaming. Council never
heard a single word about this proposal. It is significantly different from the
competitive bid.

Dec Lottery Modernization language is placed into the FY2011 budget supplement
by CM Michael Brown and Council votes twice on the budget supplement. No one
voted against the Modernization language but 2 or 3 Council Members voted
against the budget supplement due to tax abatement issues. This language allows
all types of gambling in DC with little to no restrictions except that it states
that it cannot violate federal laws

Dec GTECH one of the losing bidders issues a press release that this language is a
totally and completely different platform then what was requested and
competitively bid on by the CFO's office

PHASE THREE -- WHAT RETURNS MORE OR LESS TO THE PUBLIC EYE

2011

Jan Mayor Gray signs FY2011 Budget Supplement

Apr Congressional review period ends and Lottery Modernization becomes DC law

Apr Tom Sherwood reports that internet gambling is law on NBC

Apr 19 at the regular budget hearing on next year's budget Buddy Roogow,
executive director of the DC Lottery states that they will be offering poker, Victory
at Sea and bingo. No mention is made of computerized slots. He also does not ask
for a single increase in staffing nor any specialized experts such as a cyber auditor.
This is significant for many reasons.

Jun 29 Roundtable (not hearing) is held by Council Member Jack Evans with no
government witnesses sworn in. DC Attorney Irv Nathan states that the
implementation plans comply with federal laws Buddy Roogow when asked
describes that the DC Wilson building could in concept have a gambling room
downstairs and that it does include software for computerized slots (not video
computerized slot machines). He also reveals that there will be hotspots and that
that these games will be offered in homes. ANC's were not given great weight and
the 20 -30 hotspots were not named. (ANC’s will now be notified of potential
hotspots with 60 day notice.)

Jul Senators Reed and Kyl issue letter to US Attorney Eric Holder stating that
internet gambling is inherently interstate and is against the law to include intrastate
gambling.

Draft prepared by Marie Drissel, September 1, 2011

New Freedom of Information Request sent to CFO's office August 29, 2011

2011-09-01T16:20:00.001+01:00

From: Marie Drissel [mailto:marie.drissel@verizon.net]
Sent: Monday, August 29, 2011 7:00 PM
To: 'Lee, Laverne (OCFO)'
Subject: Freedom of Information Act Request

Dear Ms. Laverne,

Under the DC Freedom of Information Act I am requesting the following:

1. The rating or scores for the first RFP for online gaming first issued in May 2007 and transmitted to the DC Council in 2008. The hearing on this decision was April 7, 2008. I am requesting all supporting documents for the rating or score awarding the contract to Intralot and Warren Williams, Jr/Sr. in a joint venture. It is both the scores and the supporting documentation that I am requesting to show how the socres were determined with comments.

2. The rating or scores for the second RFP for online gaming awarded sometime around October 2009 and transmitted to the City Council shortly thereafter in 2009 with a hearing on November 19, 2009. Again, I want all supporting documents. The scores were given by the Council to the panelists during this November 19, 2009 hearing. It is the supporting documentation that I am requesting to show how the scores were determined with comments. (Correction of date sent to Ms. Lee--Date of hearing was November 24, 2009.)

3. All emails to and from Joseph Giddis and/or Dawn DiGiorgio concerning the contract which was approved by the City Council on December 1, 2009. I am requesting all documents, emails, electronic communication, cell phone calls and text messages for a period starting on November 19, 2009 and ending April 15, 2010 sent or received by Joseph Giddis and Dawn DiGiorgio.

4. I am requesting a copy of Attachment A for the language for B-ON™ of the Intralot contract. This was also known in some emails as Annex A. To clarify this, I am quoting an email from Dawn DiGiorgio to Jay Lapine and Emmanuel Bailey with copies to various people dated March 30, 2010 obtained through a Freedom of Information Request of CM Michael Brown. "Why don't we leave the language in Section B, so it is up front as an option and then include the detailed language you have proposed in Attachment A." I am requesting all documents involved in this description by Dawn DiGiorgio.

5. Within the FOIA on CM Michael Brown a document was found which showed the cost negotiations for implementing B-ON™. I am requesting a copy of the changes in the cost structure and the final cost structure. The document for example has a paragraph entitled "In respect of pricing at Section B.7.12 addressing Player Registration (Section C.5.13).

6. All documents, research and evidence of background checks on principals of Veteran Service Corporation.

7. All documents, research and evidence of background checks on principals of DC09.

8. On the DC Lottery web site a statement is found What about hackers? We intend to retain one of the world’s most recognized companies, IBM Managed Security Services, to deploy their industry leading security tools and expertise providing 24/7 real-time monitoring and protection should iGaming be implemented. Two weeks ago the statement on the web site is that the IBM Management Security Services have been secured. Please provide all documents involved in the competitive bidding, the scores and the costs.

9. Within the documents received in the FOIA of CM Michael Brown there are many pages describing Fantasy Sports including a piece of information which states that this will be offered across jurisdictional lines. I am requesting all documents, emails, cell phone calls concerning Fantasy Sports including any other termination (Correction: terminology) which means Fantasy Sports.

I am a citizen activist and am not doing this for any commercial purpose. As in the past and as was the standard response to my requests, I am requesting a waiver of all fees.

Thank you.

Marie Drissel

DC09 and Intralot Announce Eleven New Jobs Listed Without Preference for DC Residents

2011-08-28T17:32:00.000+01:00

Here is one example of what to expect from this new business line sponsored by the DC Government through the auspices of the DC Chief Financial Office and the DC Lottery. The job is for a Table Games Manager:

Daily interaction and cooperation with the marketing, call center and lottery CRM teams in developing and managing the Table Games player retention process, the identification of player segments and the establishment of player reactivation campaigns

Developing procedures for utilizing the company’s existing resources for reducing the churn rate of high-value Table Games players
Set and meet targets for monthly retention performance
Analyze player data and based on the findings suggest and implement appropriate action
Ensure that supervision is provided at all times while the Table Games Room is in operation
Maintains departmental budget and assists in forecasting gaming revenue.
Actively contact and work with high value players
Monitoring and reporting of all Table Games product performance
Formulation and authoring of reports and presentations that analyze collected Table Games game and player data using charts, graphs and explanatory text using Excel, Word, PowerPoint, and other software as appropriate.
Development of Table Games presentations, as assigned
Make suggestions on Handle and resolve player queries in relation to Table Games product
Handle and resolve player complaints as escalated by player support staff
Prepare for and manage the implementation of upgrades and enhancements to the Table Games product
Liaise closely with eWallet Representatives to ensure that security related issues are dealt with expediently.
Responsible for maintaining the types of games being played, the limit and buy-in
Responsible for training the types of games being played and guest service
Accurately check and provide advice on any suspect Table Games play in regard to site security and attempted fraud (Chip Dumping, Collusion, and Transfer of Funds.
Must be able to work all shifts, weekends, holidays & special events as needed

For more jobs see many of the job search engines such as Monster, Simply Hired

http://www.simplyhired.com/a/jobs/list/q-dc09/l-Greenbelt,+MD

Georgetown Dish: Starbucks as gambling venue

2011-08-15T16:35:00.002+01:00

Photo by The Georgetown Dish

Marie Drissel, taxpayer advocate, is asking Starbucks whether it condones online gambling in its stores

From the Georgetown Dish:

D.C. officials' eagerness to institute online gambling in the District has caught the

attention of the New York Times and D.C. taxpayer advocate Marie Drissel,

who is saying "Basta!" at attempts to roll out the controversial gaming plan alongside

carmel macchiatos without public hearings.

Responding to D.C. Lottery executive director Buddy Roogow's comment in the Times

that gamblers will be able to “do it from Starbucks, a restaurant, bar or hotel, or from

a private residence,” Drissel is asking the coffee chain if it has "taken such a stand and

are [you] going to allow online gambling in your coffee shops?"

See full post at Georgetown Dish.

Marie Drissel is a writer at Stop DC Gambling

Postponement of Community Outreach Meetings until After Labor Day

2011-08-11T22:11:00.000+01:00

NEWS BULLETIN: We are making an impact. The community meetings which were scheduled by the DC Lottery with no notice and all to take place at the end of August and beginning of September have been cancelled and will be rescheduled. See Tweet from CM Michael Brown below. The first one was scheduled for August 16 in just 5 days for all ANC Commissioners throughout the City.

CMMichaelABrown Michael A. Brown

Notice:@dclottery will be rescheduling the Ward community mtgs on iGaming until after Labor Day. Will provide the new dates when available.

Letter to ANC Commissioners from Commissioner Andy Litsky

2011-08-11T00:36:00.000+01:00

Dear Fellow Commissioners,

If you think that the last two weeks of August and Labor Day week is the best opportunity to hold a discussion about how gambling will be introduced in the District of Columbia then please don't bother to read any further.

The information below is from the DC Lottery Commission web site. You can log on to see precisely what the Lottery Commission -- and our DC Council -- consider appropriate "community outreach" regarding the introduction of internet gambling in each and every neighborhood in the District of Columbia.

http://www.dclottery.com/AboutUs/igaminginfo.aspx

I'll make it easy for you. Here's what they consider proper public outreach:

1. The ANC Chairs from across the city were purportedly mailed notice on August 4 requesting their attendance at a meeting with the DC Lottery on August 16 to discuss the introduction of internet gambling in our communities as soon as this October.

2. There will be eight ward meetings, each scheduled for just two hours apiece and held in small meeting rooms at local DC Public Libraries -- which may, or may not, be eventual sites for internet gambling. The DC Lottery hasn't ruled that out.

Yep. That's it. That's the extent of public outreach -- in the dead of August.

There will be no visits by Lottery Officials to seek additional concerns from the general public, or at local ANC meetings or from our community and civic associations.

But it's August and the Lottery Commission hopes to do this when most of the city is on vacation, when the Council is on recess and virtually every ANC and civic association is out of session.

Unless ANC Commissioners, civic and community association leadership, the general public and the media speak up, we risk that this may become the new standard for adopting DC legislation going forward -- quick, down, dirty and out of public view. We must demand greater accountability from our elected officials and from those whom they appoint to manage our District affairs.

Regardless of whether you believe that internet gambling is bad public policy, we must insist upon proper and thorough community input. It is particularly galling that this faux community outreach schedule appears to be acceptable to our city council, the Lottery Commission and the Mayor.

There must be proper notification to ANCs, civic associations and local churches. (See the attached Resolution that I urge you to introduce). Hundreds of small businesses currently contracted to sell lottery tickets must be notified that they may lose significant revenue if lottery tickets are to be sold online. And the Alcohol Beverage Control Commission must hold a noticed and open meeting to decide whether gambling on premises should be considered "a substantial change" under the law for hundreds of their license holders. So why the rush?

If this is how our government is handling a simple matter of public outreach, how accountable do you imagine that they are going to be once gambling is on the table? Who is watching the store? Well, we all need to be.

Remember, it's August. But see if you can get through to your Councilmember anyway, each of your at-large Councilmembers, and Chairman Kwame Brown (724-8000). Call the Mayor (727-6300). And call Buddy Roogow, Director of the DC Lottery Commission (202-645-8000). Tell Buddy to put his cards on the table -- He’s running the show.

Demand that they slow this thing down. These meetings must take place when everyone is back in town, properly noticed and focusing on this issue -- not during the last two weeks of August and the week of Labor Day. What a sham. What a shame.

Please post this information your community listserves and blogs.

Andy Litsky

Commissioner, ANC 6D-04

Southwest Waterfront

Information Fact Sheet Supporting Sample Repeal Resolution

2011-08-11T00:26:00.001+01:00

A. What Is Internet Gambling and How Did It Become DC Law?

1. Internet Gambling or Igaming is gambling on a DC owned website to play games of skill and chance and to buy lottery tickets.

2. The District of Columbia Government with its full faith and credit is the first government in the US to support, own and operate Internet gambling. Internet gambling has been through private companies usually operated offshore.

3. In 2008 the Chief Financial Officer issued a competitive bid for a new contractor for the regular lottery. That process took over one year. Unknown to the public, almost all of the Council Members and even the losing bidder, GTech, the winning team was awarded a contract with an option for a computer platform to include online gambling in March 2010. DC did not even have a law allowing online gambling when the contract was signed.

4. Nine months later, a City Council Member inserted legislative language which allows any type of gambling into the December 2010 Budget Supplement. There were no hearings with any public comment. The budget supplement was signed by the Mayor in January 2011. It then went to Congress as the entire budget supplement and since there were no Congressional objections Internet gambling became DC law in April 2011.

5. All decisions about what games are offered are being made by two DC Government officials—Dr. Natwar Gandhi and Mr. Buddy Roogow. There is no longer a board of directors or member appointees to the DC Lottery Board. It is run by the executive director, Mr. Roogow who makes $157,000 per year. Mr. Buddy Roogow lives in Maryland and told the media that he has no intentions of moving into DC. The DC Lottery is an independent agency and the executive director does not have to live in DC.

6. The contract was won by DC09, a DC LSDBE company which was formerly Veterans Service Corporation of Virginia. The CEO of DC09, the majority contractor is Emmanuel Bailey who also lives in Maryland. The winning subcontractor providing the trademarked platform is Intralot, a foreign company headquartered in Greece.

B. What Games Does the DC Internet/Intranet Platform Provide?

C. How Will It Work?

3. All players will have to be over 19. According to several interviews given by Mr. Roogow and the DC Lottery web page they will use several filters to determine the age of the gambler.

D. What Are the Expenses And Economic Issues?

3. THE REVENUE ESTIMATES PER YEAR ARE NOT INCLUDED IN THE DC BUDGET BY THE CFO FOR FOUR YEARS. (CORRECTION: According to the CFO Public Information Officer the revenue estimates are included in the budget except for only the ending months of the first Fiscal Year ending September 30, 2011. Therefore, the budget includes about $3 million in net revenue for 3 of the 4 years starting October 1, 2011.)

E. Where Will Players Be Allowed to Play and Where Will “Hotspots” Be Located?

1. The home part of the system is on track and will be operational in October 2011 according to the Lottery website.

2. After complaints at the June 29 roundtable the Lottery issued rules giving ANC’s 60 days notice to comment on proposed “hotspots.”

F. Is Home and “Hotspots” Online Gambling A Good Idea To Be Implemented by 2011?

1. A number of our District elected officials are now under investigation for ethics violations, corruption, and possible criminal activities. The process by which Online/Intranet gambling/Igaming with computerized slots was adopted in the middle of December without any public sunshine contributes to the negative perception among DC residents that our government is increasingly controlled by outside interest groups. Further, should anything go wrong especially within the federal enclave it will damage our quest for DC voting rights.

2. Mr. Roogow is promising many things like checking to see if there are particular gamblers who are addicted and blocking them. This office has not received budget authority to hire anyone new and Mr. Roogow stated in an interview that he needs to hire an expert cyber auditor. There is no money for this. So this office must run the paper lottery and this new huge business line without any increased staff.

3. D.C. Government will be the first Government in the US to operate online gambling with no rules and regulations and case law history.

How To Get Further Information?

1. Marie Drissel, Ward 2 prepared the Q&A and worked with several people to refine the sample repeal resolution.

2. A website/blog at Stopdcgambling.com has just been established.

3. For any comments please email marie.drissel@verizon.net

4. Public outreach meetings have been scheduled from August 16 until September 15, 2011 by the DC Lottery.

5. The first meeting is for all ANC Commissioners on August 16 from 7 to 9 PM at the DC Lottery on MLK Avenue. http://www.dclottery.com/AboutUs/igaminginfo.aspx

Sample Resolution to Repeal Online Gambling Law

2011-08-10T21:33:00.001+01:00

Whereas the online/Internet gambling/iGaming including computerized slots legislation was inserted into the December 2010 budget without public discussion or public hearings, contrary to the principles of open and transparent government; and

Whereas the potential negative economic impacts associated with bringing online gambling supported and operated by the District of Columbia Government everyday until 4AM may include increased police protection, alcohol beverage control, zoning and fire safety enforcement, specialized protection against hacking of the DC Government website and its gambling site, and increased addiction treatment vastly outweigh the projected annual financial benefits to the District that might be realized by its implementation.

Now, therefore let it be resolved that (ANC Commissions, civic associations, churches, citizens) supports the immediate repeal of the “Lottery Modernization Amendment Act of 2010” and a moratorium on the implementation of DC Government online /Internet gambling/iGaming including computerized slots so that this issue in stand alone legislation can be thoroughly vetted in an open and fully transparent manner with proper public consideration, comments, hearings and recorded vote by the Council of the District of Columbia and approval/signature of the Mayor.

Was gambling really delayed in DC?

2011-07-11T14:00:00.041+01:00

Following the Finance Committee hearing this month, the DC Lottery agreed to delay implementation of its mini-casino plan a.k.a. “hot spots,” until there are rules for community input.

Councilmember Jack Evans, in a press release immediately following the hearing on gambling, made it clear that there needs to be "community meetings to ensure residents have ample time to consider i-Gaming locations prior to any decisions being made."

The DC Lottery intends to begin demonstration games late this month and originally had planned to start cash gambling Sept. 8.

There are two problems with Evan’s actions.

The first is that it lacks specifics.

Evans was interviewed by The Current (download PDF, story begins on front page) and is quoted as saying that the process for implementing hot spots should be delayed “‘for two months, maybe even longer.’ ” But the story goes on to say that “he has no objection to the lottery board launching its planned no-money trial of its online games later this month, or rolling out the pay games on Sept. 8.”

Let's try to parse out what this means.

The ward-by-ward public hearings sought by Evans can’t be held until September, at the earliest. Many of the ANCs have already held their final meetings for the summer, and August is no month to hold hearings on such an important issue.

Once the hearings are held, the DC Lottery still has to deliver a plan for notifying neighborhoods of proposed mini-casino locations and soliciting input. Whether the DC Lottery can deliver a satisfactory plan for neighborhood input is a big question, since the Lottery may be more interested in developing a plan for minimizing neighborhood meddling.

The Current story also suggests that cash betting may still begin on Sept. 8. How is that possible? DC Lottery could try to set up a mini-casino in downtown, or try to make it available to private homes that meet its conditions for a fixed IP address.

But a second and more serious problem with Evan’s hearing plan is its premise (See Evan's press release PDF).

Evan's action to delay implementation presupposes that the only issue to be resolved is the process for community input of hot spot locations. This community has not yet debated whether it wants this expansion of gambling. A lot of people, it can be assumed, don’t want it at all, but their voices have been shut down by the legislative process.

Keep in mind that the only public hearing ever held on DC’s new gambling law was held after the law was approved.

Making a case against DC gambling

2011-07-02T20:47:00.001+01:00

The details of DC's gambling law raise a number of issues specific to neighborhoods, many of which came out at the hearing DC's Finance Committee recently held.

In preparing testimony, however, for it, I focused on some of the broader issues associated with gambling. I'll be writing more about neighborhood implications later.

This is what I said before the committee:

Had this gambling law received proper vetting an analysis it would not have passed, and here are the reasons why.

I was a daily newspaper reporter in Connecticut in the mid-1980s when the Native American tribes won approval to convert bingo halls into casinos, and that’s why I am interested in this issue as well as worried about it.

The approval of casinos on Native American lands touched off a debate in neighboring states and cities in New York and New England, which continues today. But this push to expand gambling to compete with the Native American casinos has been generally rejected by these communities.

Here are the two major reasons why:

First, they reject gambling because it hurts local economies. It’s parasitic. Gambling acts like sponge that soaks up discretionary household dollars, money otherwise spent on local goods and services. This offsets the tax gains from casino revenue.

And local businesses don’t support it. They have no reason to support something that competes for household budgets.

These communities realized that by approving gambling, they were also expanding it, compounding their losses. And so they rejected it.

Second, they rejected the expansion of gambling because of its social costs, its links to crime, bankruptcy, and divorce.

A certain percentage of the population is prone to addiction, and an even larger number will simply have a problem with it.

Expanding gambling meant, quite clearly, expanding the risk pool -- the number of people potentially adversely affected.

[What’s surprising about the District’s law is that it doesn’t set aside any tax revenue to help families who may need help in coping with a spouse, or senior parent, a young adult, who develops a gambling problem. Even Nevada does that. ]

A third point is specific to the District.

The District’s law creates electronic casinos at hotels, bars and restaurants.

These facilities will expand to the neighborhoods. And this is how it will happen.

Businesses will argue that people gambling from their home generate no additional economic benefit. But if you allow gambling facilities in neighborhoods you will create service jobs. The biggest push for gambling specific facilities will be in the poorer neighborhoods.

Neighborhoods will have legitimate questions and special concerns. How many users will these facilities support? How will they operate?

Neighborhoods may oppose this attempt to turn their neighborhoods into a Pottersville.

This law provides no notice to the ANC of a plan to create an electronic casino. It allows the ANCs no oversight. (UPDATE: Aug. 17 -- ANC's will now get 60 day notice to comment on proposed hot spots)

Neighborhoods deserve the right to be notified, and the ability to block this expansion. It is a major flaw in this law to exclude the ANCs from a role.

In summary, it is important to realize that this is an expansion of gambling. This is not substituting what constitutes online gambling today with a government sponsored system.

The one true thing about gambling is that it destroys wealth, it doesn’t create it. It doesn’t make a community stronger, it makes it weaker.

You have not studied the implications of this law or prepared this community for it.

The right thing to do now is to delay its implementation, and bring in independent experts who can give you a clear view of gambling’s impact on the District’s economy. You need access to people who understand gambling addiction, and can explain its dangers. You also need to bring in network security experts to assess the risks posed by D.C. Lottery’s plan to use the government’s internal network to host this system.

If these independent studies are undertaken, you will discover, as others have before you, that this plan to expand gambling creates substantial risks for the District’s economy and its people.

Public hearing on DC's gambling law this week

2011-06-26T20:15:00.001+01:00

The D.C. Council's finance committee will hold a pubic hearing Wednesday at 10 a.m. at the Wilson building on its new Internet and electronic casino law.

This law, which allows gambling over the Internet as well as via electronic casinos, in bars, hotels and restaurants was approved in December without an hearing or much debate. It was approved as a rider on a budget bill.