0001

1 BEFORE THE GAMING COMMISSION

STATE OF MISSOURI

OPEN MEETING

May 30, 2001

3417 Knipp Drive

8 Jefferson City, Missouri

COMMISSIONER MEMBERS: L.G. Ullrey, Chairman

13 Lynne R. Nikolaisen, Secretary

Dr. Muriel W. Battle

14 Robert Smith

20 REPORTED BY:

KRISTAL R. MURPHY, CSR, RPR, CCR

22 ASSOCIATED COURT REPORTERS, INC.

714 West High Street

23 Post Office Box 1308

JEFFERSON CITY, MISSOURI 65102

24 (573) 636-7551

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1 I N D E X

2 I. Call to Order 5

3 II. Consideration of Minutes

A. February 21, 2001 5

III. Consideration of Hearing Officer

5 Recommendations

B. Jeffrey Bartlett 7

6 1. Resolution No. 01-144

C. Hillary Pobee 9

7 1. Resolution No. 01-145

8 IV. Presentation by Ameristar 23

9 V. Presentation by Sheriff David Parrish

and Prosecuting Attorney Jules DeCoster 27

VI. Presentation by Dr. Donald Phares 50

VII. Presentation by Mayor Brian Selsor 62

VIII. Presentation by Ken Peck and

13 Gene Perstrope 69

14 IX. Presentation by Valerie Badgley 83

15 X. Presentation by Shirley Berving, Mary 90

Hostetter and Barb Obormeyer

XI. Presentation by Glee Naes and Larry 109

17 Schlecht

18 XII. Presentation by Richard C. Shepard 128

19 XIII. Presentation by Jerry Feldhaus 146

20 XIV. Lunch/Closed Session 156

21 XV. Consideration of Relicensure of Certain 157

Class A Licensees

22 D. Isle of Capri-Kansas City, Inc.

Presentation by Applicant

23 Presentation by City of Kansas City

Public Comment

24 Investigative Recommendation

Resolution No. 01-046

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1 I N D E X

2 XVI. Consideration of Licensure of Certain 175

Suppliers

3 E. Venture Systemsource, Inc.

1. Resolution No. 01-047

XVII. Consideration of Relicensure of Certain 177

5 Suppliers

F. Paul-Son Gaming Supplies, Inc.

6 1. Resolution No. 01-048

G. Casino Data Systems

7 1. Resolution No. 01-049

8 XVIII.Consideration of Proposed Rulemaking 179

H. Final Orders of Rulemaking

9 1. 11 CSR 45-5.030 - Participation

in Gambling Games by a Holder

10 of a Class A License, Directors,

Officers, Key Persons or

11 Employees of Such Licensees

2. 11 CSR 45-7.030 - Required

12 Surveillance Equipment

3. 11 CSR 45-7.040 - Required

13 Surveillance

4. 11 CSR 45-7.050 - Casino and

14 Commission Surveillance Room

Requirements

15 5. 11 CSR 45-7.080 - Storage and

Retrieval

16 6. 11 CSR 45-7.130 - Nongambling

Hours

17 7. 11 CSR 45-7.050 - Compliance

with this Chapter

XIX. Consideration of Settlement Agreements 194

19 I. Epilepsy Foundation

1. Resolution No. 01-003-B

20 J. Epilepsy Federation Auxiliary

1. Resolution No. 01-004-B

21 K. Epilepsy Association of the Ozarks

1. Resolution No. 01-005-B

22 L. Knights of Columbus #6435

1. Resolution No. 01-006-B

XX. Adjournment 203

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1 P R O C E E D I N G S

2 CHAIRMAN ULLREY: We'll come to order.

3 Angie, would you call the roll for me,

4 please?

5 MS. FRANKS: Chairman Ullrey?

6 CHAIRMAN ULLREY: Present.

7 MS. FRANKS: Commissioner Smith?

8 COMMISSIONER SMITH: Present.

9 MS. FRANKS: Commissioner Nikolaisen?

10 COMMISSIONER NIKOLAISEN: Present.

11 MS. FRANKS: Commissioner Battle?

12 COMMISSIONER BATTLE: Present.

13 CHAIRMAN ULLREY: Commissioner Adorjan?

14 (No response.)

15 CHAIRMAN ULLREY: Mr. Director.

16 MR. MULLALLY: Mr. Chairman, the first item

17 on the agenda, the Tab A in your books, is the minutes

18 for the February 21st, 2001 meeting. And I just

19 noticed an error on the cover page. The year 2000

20 should be 2001, and on the inside front cover as well.

21 COMMISSIONER SMITH: Does that mean we're a

22 backward organization, or --

23 CHAIRMAN ULLREY: We have before us the

24 minutes of the February 21st, 2001 meeting.

25 Do we have corrections or do we have any

0005

1 comments, changes? If not, we'll entertain a motion.

2 MR. MULLALLY: We should correct that cover

3 page, I think, and the inside front cover.

4 COMMISSIONER NIKOLAISEN: I move for

5 approval with those changes.

6 COMMISSIONER BATTLE: I'll second.

7 CHAIRMAN ULLREY: We have a motion and we

8 have a second for approval with the changes to 2001.

9 COMMISSIONER SMITH: Mr. Chairman, I would

10 like to abstain because I wasn't present, but I wanted

11 to say I read the minutes and I was very impressed

12 about how knowledgeable the Commissioners were and

13 their profound thoughts, I thought, were very good.

14 CHAIRMAN ULLREY: Thank you,

15 Mr. Commissioner. Things move without you. Is that

16 what you're saying?

17 COMMISSIONER SMITH: I was impressed.

18 CHAIRMAN ULLREY: I have a motion. I have a

19 second.

20 Angie, would you call the roll on this?

21 MS. FRANKS: Chairman Ullrey?

22 CHAIRMAN ULLREY: In favor.

23 MS. FRANKS: Commissioner Smith?

24 COMMISSIONER SMITH: Abstain.

25 MS. FRANKS: Commissioner Nikolaisen?

0006

1 COMMISSIONER NIKOLAISEN: In favor.

2 MS. FRANKS: Commissioner Battle?

3 COMMISSIONER BATTLE: In favor.

4 MS. FRANKS: By your vote, you have adopted

5 the minutes of the February 21st, 2001 meeting as

6 amended.

7 MR. MULLALLY: Mr. Chairman, the next item

8 on the agenda is the matter of -- consideration of the

9 matter of Jeffrey Bartlett versus Missouri Gaming

10 Commission. Under Tab B you have a complete record of

11 the hearing, and Judge McCormick Wilson will make the

12 presentation.

13 JUDGE WILSON: May it please the Commission?

14 I was listening to what Commissioner Smith

15 said, and I was reminded of the time that the minutes

16 of the meeting said they had perfect attendance.

17 Everybody was there but me.

18 COMMISSIONER SMITH: I can understand that.

19 CHAIRMAN ULLREY: Thank you, Judge.

20 JUDGE WILSON: This is a fairly routine

21 matter in Mr. Bartlett's case. He was licensed as a

22 dealer. The agent of the Commission very carefully

23 ran up $420 on his automated loss limit card,

24 presented that card and $100 bill to Mr. Bartlett and

25 asked for chips for the $100. The dealer swiped the

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1 card, handed him the $100 worth of chips and put the

2 cash in the slot.

3 After he had used the chips, or some of

4 them, he checked his card again at a machine and found

5 that it still had $420 showing on it. The dealer, in

6 fact, exceeded the $500 loss limit and failed to zero

7 out the card.

8 I find no evidence that the dealer

9 intentionally misconducted himself. He has testified

10 in detail how many things were going on, how many

11 responsibilities he had, how quickly the machine

12 registered, and said that if it was wrong, it was

13 wrong. He missed it.

14 My recommendation is that he be given a

15 five-day suspension, which I believe is standard in

16 these cases.

17 CHAIRMAN ULLREY: Thank you, Judge.

18 Do we have any comments reference this

19 particular case?

20 COMMISSION NIKOLAISEN: I move for approval

21 of Resolution 01-044.

22 COMMISSIONER SMITH: I second the motion.

23 CHAIRMAN ULLREY: I have a motion and I have

24 second for 01-044.

25 Angie?

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1 MS. FRANKS: Chairman Ullrey?

2 CHAIRMAN ULLREY: In favor.

3 MS. FRANKS: Commissioner Smith?

4 COMMISSION SMITH: In favor.

5 MS. FRANKS: Commissioner Nikolaisen?

6 COMMISSIONER NIKOLAISEN: In favor.

7 MS. FRANKS: Commissioner Battle?

8 COMMISSIONER BATTLE: In favor.

9 MS. FRANKS: By your vote, you have adopted

10 Resolution No. 01-044.

11 MR. MULLALLY: Thank you, Judge.

12 Mr. Chairman, Commissioners, under Tab C,

13 you will find the record of the hearing in Hillary

14 Pobee versus the Missouri Gaming Commission.

15 Hearing Officer Mike Yost will present the

16 recommendation.

17 MR. YOST: This case involved an individual

18 named Hillary Pobee who applied for a gaming license

19 and failed to disclose some information on his

20 application. Specifically, he failed to disclose the

21 use of aliases in the past, and he failed to disclose

22 several arrests that took place in the state of New

23 Jersey in the 1980s and 1990s.

24 We had a hearing on this, and, to be honest

25 with the Commissioners, this was a difficult case for

0009

1 me to rule on. Mr. Pobee's claim was simply that he

2 is an African; he was born in Africa, and he speaks

3 very broken English. And his claim was that he really

4 didn't understand the depth of the question that was

5 answered -- or asked of him when he was asked if he

6 had ever been arrested. It was his testimony that he

7 didn't know he wasn't -- he was unclear about how much

8 he was supposed to disclose. He did disclose two

9 arrests. He did not disclose an additional six

10 arrests.

11 The regulation is very clear on this, that

12 even an unintentional nondisclosure can subject

13 someone to nullify their gaming license.

14 This case, it was difficult for me to decide

15 on this because, first of all, I don't know if I was

16 100 percent convinced of Mr. Pobee's claim that he did

17 not completely understand the question, but his

18 English was broken enough that I -- I just don't know.

19 There was -- it is certainly possible that he had

20 difficulty understanding.

21 I think the question is worded very clearly.

22 It is not a problem with the way the application

23 reads. It was just a -- it is possible there was a

24 language difficulty.

25 So when I looked at this, I looked at the

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1 totality of the circumstances, if you will. I asked

2 the Gaming Commission representatives who were at the

3 hearing if this were a matter that had been

4 disclosed -- I'll be honest. I was troubled by the

5 specific arrests that were made, the subject matter of

6 them, and I asked the -- because they deal with theft

7 and misrepresentations.

8 And I asked the representatives of the

9 Commission if this was something that had been

10 disclosed that would have resulted in the denial of

11 his license, and they told me that it would not, since

12 these were arrests and not convictions.

13 And so when I weighed that the fact with the

14 fact that this individual had worked 15 months with a

15 temporary license without incident and the possibility

16 that he may very well have been confused as to what

17 was being asked of him, it's my recommendation to the

18 Commission that the Commission go ahead and grant his

19 gaming license.

20 CHAIRMAN ULLREY: I have a question.

21 What he did not reveal as far as arrests are

22 concerned, were not convictions, is that right --

23 MR. YOST: That's --

24 CHAIRMAN ULLREY: -- all of this that he did

25 not disclose?

0011

1 MR. YOST: That was the evidence presented

2 before me.

3 CHAIRMAN ULLREY: And the ones he did list,

4 were they convictions?

5 MR. YOST: They were just arrests as well,

6 the best I can tell.

7 COMMISSIONER SMITH: He sure got arrested a

8 lot without being convicted.

9 Mr. Chairman, it seems to me -- there was a

10 couple of questions I had.

11 One is -- he has been working, as I

12 understand, for a year without any problem.

13 MR. YOST: Yes.

14 COMMISSIONER SMITH: And I notice these

15 arrests were all at least five years ago and some of

16 them twelve years, so is that a factor you took into

17 consideration as far as --

18 MR. YOST: Yeah. Yes, it was. Like I said,

19 this was tough because the question is pretty clear,

20 and Mr. Pobee, at least in the course of our hearing

21 that we conducted, seemed to understand what was going

22 on. But there was enough communication problems, I

23 just wasn't convinced that it's not possible that he

24 could have just not understood what was being asked.

25 And he did disclose some arrests that quite frankly

0012

1 wouldn't have been favorable upon a review of the

2 license anyway.

3 So I just didn't know what to think of this

4 person, so I basically looked at those facts. But,

5 like I said, given the age or not, the subject matter

6 of the arrests were somewhat troubling, by the age and

7 the fact that he had proven through 15 months of work

8 that he hadn't had much problem was the reason why I

9 made the recommendation that I did.

10 CHAIRMAN ULLREY: Commissioner Battle.

11 COMMISSIONER SMITH: Since there is no

12 conviction, we have discretion then?

13 MR. YOST: That's my opinion.

14 CHAIRMAN ULLREY: Commissioner Battle.

15 COMMISSIONER BATTLE: The question reads,

16 "Have you ever been arrested?"

17 MR. YOST: Right.

18 COMMISSIONER SMITH: Chairman, I would move

19 the approval of the resolution and the hearing

20 officer's recommendation of the adoption of 01-045 in

21 view of the information that he's provided.

22 COMMISSIONER NIKOLAISEN: I have some

23 questions maybe before that.

24 In the past we have been presented with

25 other people who claim they did not understand the

0013

1 question, who claim that a lawyer told them a drug

2 conviction in college or something would not appear on

3 their record and it did, and we didn't give them any

4 discretion. We said the law stands, and ignorance of

5 the law doesn't absolve them. They too had good

6 records since they had these convictions or arrests.

7 I am greatly troubled and greatly confused

8 by this, because I think we are setting a nasty

9 precedent. We lower the bar, and we are saying, you

10 know, Geez, you've got all of these problems. You

11 didn't understand. There's a problem with English.

12 I wasn't there at the hearing, but I read

13 and I looked at the application. I read the arrest

14 warrant. Very cleverly the Social Security numbers

15 change by one or two numbers.

16 I think we have a highly intelligent

17 individual who was doing what they could for U.S.

18 citizenship as probably most people would. That

19 citizenship is a diamond, but I still -- while I may

20 understand what was done, I have a great deal of

21 trouble understanding how we can do this now when

22 we've hurt so many other people in the past. I think

23 we are setting, like I said, a very nasty precedent.

24 MR. YOST: All I can tell you, Madam

25 Commissioner, is that I -- I don't necessarily

0014

1 disagree with what you're saying. I would, in fact,

2 point out in the transcript where Mr. Pobee, I think

3 against what his attorney probably wished him to do,

4 admitted the use of his prior aliases were done so

5 that his citizenship would not have -- it was a

6 collateral issue, but was done not to the Commission,

7 but his use of aliases on his past arrests were done

8 so that the bodies that -- the powers that be that

9 grant citizenship would not be able to track him down.

10 He came out and admitted that in the hearing.

11 That's particularly why I asked the

12 Commissioner -- the representatives of the Commission

13 that were there, you know, had you known about this

14 particular arrest, would you have denied him a license

15 on the basis of that? And they told me they would not

16 have, since they were not convictions. And so I was

17 looking at it simply on the issue of his nondisclosure

18 of the arrests and not necessarily the subject matter

19 of them. Do you understand what I'm saying?

20 COMMISSIONER NIKOLAISEN: I do. And I also

21 notice some hesitancy when you asked the people

22 present. I got the indication they weren't sure

23 absolutely. They couldn't say with 100 percent

24 certainty that a license would not be granted had the

25 other, what is it, four or five aliases, three Social

0015

1 Security numbers, and other six arrests been put down,

2 and we're saying they must disclose.

3 And I just have a big trouble saying these

4 weren't disclosed, and other people didn't disclose,

5 and we said, Your license is out of here, and we're

6 saying this individual, no problem. I have a big

7 problem with that. That's just my statement.

8 CHAIRMAN ULLREY: Thank you, Lynne.

9 COMMISSIONER SMITH: Chairman, I guess I

10 better comment on my feeling.

11 I think there is a distinction that we can

12 make between conviction and arrest. I mean, to me

13 there is no question if it's a conviction. An arrest,

14 I guess in my mind as a lawyer, it doesn't prove

15 anything.

16 I mean, I'm troubled by the number of these

17 things, and I think we -- maybe we have been -- I

18 don't know of any time where there's been a conviction

19 of an arrest we've allowed the person not to be

20 punished, but it seems to me that where they are

21 arrests without a conviction, then we have discretion.

22 And I think you have to exercise that discretion. I

23 don't think it sets a precedent on a different set of

24 facts.

25 I feel differently. I understand your

0016

1 position, and it troubles me some, too.

2 COMMISSIONER NIKOLAISEN: Let me ask this:

3 do we have discretion?

4 Maybe that's where I'm confused because

5 we're saying that there is a misrepresentation on the

6 application. I thought it was just the fact -- I'm

7 not disputing the difference between an arrest and a

8 conviction. I'm talking about the failure to

9 disclose, which I understand is statute? Am I --

10 somebody help me out here.

11 MR. YOST: It's a regulation.

12 CHAIRMAN ULLREY: It's a regulation.

13 MS. CHURCHILL: It's a regulation.

14 CHAIRMAN ULLREY: Is it regulation,

15 Patricia?

16 COMMISSIONER NIKOLAISEN: It's a regulation.

17 MR. YOST: And the regulation does -- is a

18 discretionary rule, and the statute dealing with

19 convictions is not when dealing with felony

20 convictions.

21 CHAIRMAN ULLREY: Dr. Battle, do you have

22 any comments?

23 COMMISSIONER BATTLE: I kind of share all of

24 the feeling in that I'm a little bit troubled about

25 it, too. And I can understand why it was a difficult

0017

1 call for you to make, because most people, when given

2 even a ticket, would be inclined to give another name

3 for fear of all that will come from having had the

4 citation. So that doesn't impress me a lot. I mean,

5 I can understand if he didn't want it to interfere

6 with his visa.

7 CHAIRMAN ULLREY: Unless there is objections

8 from a Commissioner, I would certainly like to see

9 this tabled, and then right after that, I would like

10 to see our legal people come up and tell me why we

11 should or should not address this.

12 MS. CHURCHILL: One of the issues, too, is

13 that you have the record before you. We could give

14 you interpretation as far as what your options are

15 legally, but as far as facts that weren't in evidence,

16 you need to make your decision on the record that was

17 established that day.

18 COMMISSIONER NIKOLAISEN: So the fact that

19 maybe we don't know if there are three Social Security

20 numbers out there, which is technically illegal, or if

21 there is just one and the numbers were just --

22 MS. CHURCHILL: That's one of the problems

23 with failure to disclose. It deprives the Commission

24 of the opportunity to determine those issues. When it

25 is not disclosed that there were arrests, we don't

0018

1 know the facts around those arrests. We don't know

2 the -- whether or not there were actually multiple

3 Social Security numbers or whether they just used

4 contrived ones.

5 CHAIRMAN ULLREY: Well, the fact, as far as

6 I can determine here, is that he did not disclose. Is

7 that correct, Mr. Yost?

8 MR. YOST: That's correct.

9 CHAIRMAN ULLREY: We still have a motion to

10 approve this. Do we have a second?

11 (No response.)

12 COMMISSIONER SMITH: I guess the motion

13 denies then.

14 CHAIRMAN ULLREY: If there is no second,

15 then somebody is going to have to guide me now as to

16 what -- where we go with this.

17 COMMISSIONER SMITH: Mr. Chairman, I would

18 move we table it until the next meeting to give an

19 opportunity, maybe, to get more facts about it, if the

20 Commission is concerned about the circumstances

21 involving those arrests.

22 MS. CHURCHILL: Again, without the -- the

23 facts that, you know, you will be charged with making

24 your decision on are those facts that were established