00001

01                COVER SHEET INFORMATION

02  Hearing Before the:  Missouri Gaming Commission

03  In Re:               Commission Resolutions/Approvals

04  Date Taken:          December 1, 2005

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01  PUBLIC HEARING BEFORE THE MISSOURI GAMING COMMISSION

02   

03         BE IT REMEMBERED that the above-entitled matter

04  came on for a public hearing at the Renaissance Hotel,

05  9801 Natural Bridge Road, County of St. Louis, State of

06  Missouri, on the 1st day of December, A.D., 2005,

07  commencing at the hour of 9:00 in the morning of that

08  day, said hearing having been called by The Missouri

09  Gaming Commission pursuant to the issuance of due

10  notice to all parties in interest, and the following is

11  a transcript of the record made of all proceedings had

12  during the course of said hearing.

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00003

01  APPEARANCES:

02  Kevin Mullally, Executive Director

03  Steve Johnson, Chief Deputy Director

04  Chairman Floyd Bartch

05  Commissioner Noel Shull

06  Commissioner Judy Hinrichs

07  Commissioner Darryl Jones

08  Commissioner Ralph Biele

09  

10                       I N D E X

11  SPEAKERS:                                         Page

12  STEPHEN J. STARK . . . . . . . . . . . . . . . .    6

13  PAUL F. LITTLETON. . . . . . . . . . . . . . . .   14

14  CYNTHIA BOLDEN . . . . . . . . . . . . . . . . .   31

15  TOM CAMPBELL . . . . . . . . . . . . . . . . . .   39

16  KIM HARDY. . . . . . . . . . . . . . . . . . . .   40

17  DANIELLE BLANCK. . . . . . . . . . . . . . . . .   50

18  STEVE JOHNSON. . . . . . . . . . . . . . . . . .   58

19  MICHAEL BUSHMANN . . . . . . . . . . . . . . . .   62

20  JANE RACKERS . . . . . . . . . . . . . . . . . .   72

21  MARTHA LEMOND. . . . . . . . . . . . . . . . . .   90

22  WADE HUNDLEY. . . . . . . . . . . . . . . . . . .  92

23  CLIFF KORTMAN . . . . . . . . . . . . . . . . . .  99

24  MARK ANDREWS . . . . . . . . . . . . . . . . . .  105

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00004

01            MISSOURI GAMING COMMISSION MEETING

02               CHAIRMAN BARTCH:  We'll call the meeting to

03  order.  Angie, would you call the roll?

04               MS. ANGIE FRANKS:  Chairman Bartch?

05               CHAIRMAN BARTCH:  Present.

06               MS. FRANKS:  Commissioner Hinrichs?

07               COMMISSIONER HINRICHS:  Present.

08               MS. FRANKS:  Commissioner Biele?

09               COMMISSIONER BIELE:  Present.

10               MS. FRANKS:  Commissioner Jones?

11               COMMISSIONER JONES:  Present.

12               MS. FRANKS:  Commissioner Shull?

13               COMMISSIONER SHULL:  Present.

14               MR. MULLALLY:  Chairman, the first item on

15  the agenda is the consideration of minutes from the

16  September 28 and October 26 meetings.

17               COMMISSIONER HINRICHS:  I would move to

18  approve the minutes of the September 28 Commission meeting.

19               COMMISSIONER JONES: Second.

20               CHAIRMAN BARTCH:  So moved.  Any further

21  discussion?  If not, please call the roll.

22               MS. FRANKS:  Chairman Bartch?

23               CHAIRMAN BARTCH:  Approved.

24               MS. FRANKS:  Commissioner Hinrichs?

25               COMMISSIONER HINRICHS:  Approved.

 

 

 

00005

01               MS. FRANKS:  Commissioner Biele?

02               COMMISSIONER BIELE:  Approved.

03               MS. FRANKS:  Commissioner Jones?

04               COMMISSIONER JONES:  Approved.

05               MS. FRANKS:  Commissioner Shull?

06               COMMISSIONER SHULL:  Approved.

07               MS. FRANKS:  By your vote, you've approved

08  the minutes from the September 28, 2005 meeting.

09               COMMISSIONER HINRICHS:  I move we approve

10  the minutes from the October 26 Commission meeting.

11               COMMISSIONER JONES: Second.

12               CHAIRMAN BARTCH:  So moved.  Any further

13  discussion?  Please call the roll.

14               MS. FRANKS:  Chairman Bartch?

15               CHAIRMAN BARTCH:  Approved.

16               MS. FRANKS:  Commissioner Hinrichs?

17               COMMISSIONER HINRICHS:  Approved.

18               MS. FRANKS:  Commissioner Biele?

19               COMMISSIONER BIELE:  Approved.

20               MS. FRANKS:  Commissioner Jones?

21               COMMISSIONER JONES:  Approved.

22               MS. FRANKS:  Commissioner Shull?

23               COMMISSIONER SHULL:  Approved.

24               MS. FRANKS:  By your vote, you've approved

25  the minutes of the October 26, 2005 meeting.

             

 

 

 

00006

01               MR. MULLALLY:  Mr. Chairman and Commissioners, we

02  have a series of seven hearing officer recommendations, and Hearing

03  Officer Steve Stark is here to make those presentations.

04               MR. STEPHEN STARK:  Good morning, Commissioners. 

05  If it may please the Commission, we'll start with

06  what's been marked with, I guess, Tab C, the President

07  Riverboat Casino, Missouri, Incorporated.  This case

08  deals with the duties of a casino to prevent and to

09  report violations and misconduct. 

10         The facts of the case, as presented at the

11  hearing, are that during the morning, very early

12  morning hours, of June 29, 2004, at approximately 12:33

13  a.m., an employee of the President Casino named Mr.

14  Terry Foerste gets into his car, located in the

15  casino's parking lot.  Now, the parking lot is about

16  100 yards from the casino's boat, but is still part of

17  the casino's property. 

18         Now, while Mr. Foerste drives out of the parking

19  lot, he hits another parked car that was located in the

20  lot.  Then he runs into the metal gate, or railing, at

21  the entrance of the exit of the parking lot and then

22  upon exiting the parking lot itself, he runs into a

23  shuttle bus that is attempting to enter into the

24  parking lot, damaging the back bumper of that shuttle

25  bus.  So property damage was done to the parked car, to

 

 

 

00007

01  the parking lot gate, to the shuttle van and to Mr.

02  Foerste's car, itself.  However, Mr. Foerste continues

03  on driving without stopping. 

04         At 12:35 a.m., the shuttle bus driver calls into

05  the casino to report the incident and soon thereafter,

06  two employees of the casino arrive at the scene to

07  investigate.  At 12:52 a.m., less than 20 minutes after

08  the start of this incident, the casino dispatch calls

09  the St. Louis Police Department.  Within ten minutes or

10  so, the police arrive at the casino parking lot, but

11  the police officer leaves after being told by the

12  casino employees that the casino would be conducting

13  its own investigation as an internal matter. 

14         Approximately 1:30 a.m., Mr. Foerste returns to

15  the parking lot in his damaged car.  He speaks with

16  some of the casino employees, admits to the property

17  damage.  One employee stated in a written report that

18  was made later on that Mr. Foerste appeared that he may

19  have been drinking, and the employee even suggested to

20  Mr. Foerste that he take a taxi home or let someone

21  else drive him home.  This was during a weekday, so the

22  casino closes at 4:00 a.m. 

23         Then at 8:30 a.m., that same day, that same

24  morning, the human resource director of the casino does

25  call the Commission, the gaming agent, to report the

 

 

 

00008

01  incident, nearly eight hours after it all started. 

02         Now, the Commission staff have alleged

03  violations of Regulation 11 CSR45-10.030.  And that

04  regulation actually consists of several paragraphs, but

05  three are applicable in this case.  The first part

06  requires that the licensee, the casino in this case,

07  promptly report to the Commission any violation of law,

08  internal control standards or Commission rule. 

09         The second part of the regulation imposes a duty

10  to prevent unlawful conduct upon the licensed premises.

11         The third part requires that the casino has the

12  licensee immediately report to law enforcement

13  authorities any illegal or violent acts that are

14  committed on or about the licensed premises. 

15         Now, paragraph 16 of the Preliminary Order for

16  Discipline recites this whole regulation.  So I looked

17  at all three parts of this regulation to see if there

18  were, indeed, three separate violations.  Now, when I

19  initially made my recommendations presented to the

20  Commission on September 28, I found that the President

21  Casino only violated part one of the three different

22  parts of this regulation. 

23         Based upon our discussions on September 28, I

24  further reviewed the facts and law as presented in the

25  hearing record and now I present my recommendations to

 

 

 

00009

01  the Commission that the President Casino did violate

02  part one and part two of this regulation.  I am still

03  finding that no violation occurred as to part three of

04  the regulation. 

05         Now, if we may look at each part of the

06  regulation.  Again, part one imposes the duty on the

07  licensee to promptly, again the emphasis on promptly,

08  report to the Commission violations of law.  The facts

09  of this case show that there was property damage being

10  committed on the parking lot of the casino.  The

11  employees of the President Casino had enough facts

12  before them from their physical examination of the

13  scene, the shuttle bus driver's report of being hit,

14  the surveillance tape.  With all this information,

15  there was reasonable grounds to believe that a

16  violation of law had occurred. 

17         The casino did report the incident to the

18  Commission's agents, but waited four hours.  Or excuse

19  me, waited eight hours.  Now, the casino's closed and

20  there's no gaming agent available from 4:00 to 8:00. 

21  So even if we discount that fact that those four hours,

22  I still conclude that the President Casino did not

23  conform with this regulation in promptly reporting this

24  incident to the Gaming Commission.  So my

25  recommendation is that cause does exist to discipline

 

 

 

00010

01  for this violation of part one of the Regulation

02  10.030. 

03         Now, for part two of the regulation, a duty to

04  prevent violent and unlawful conduct upon the licensed

05  premises.  Again, my initial recommendation made on

06  September 28, was that the President Casino did not

07  violate this part of the regulation based upon my

08  conclusion that the President Casino did not have the

09  opportunity to prevent the property damage that

10  occurred on the parking lot.  However, I failed to give

11  consideration to the fact that Mr. Foerste returned to

12  the parking lot within an hour after the property

13  damage was committed.  At that time, the President

14  Casino met with Mr. Foerste.  Mr. Foerste admitted to

15  committing the property damage.  The employees had an

16  opportunity to observe Mr. Foerste.  One employee even

17  reported that it appeared that Mr. Foerste had been

18  drinking.  He expressed concern that Mr. Foerste, about

19  Mr. Foerste driving home alone and this concern was

20  expressed after reviewing the surveillance tape by the

21  employee.  So upon further review, the -- it's my

22  conclusion that the employees of the President Casino

23  did have the opportunity to prevent Mr. Foerste from

24  driving again and possibly committing unlawful conduct. 

25  The employees did not fulfill their duty according to

 

 

 

00011

01  this regulation. 

02         Now, however, this regulation is part two of the

03  regulation.  It does have a limitation on it, which we

04  need to discuss.  It says that the activity must occur

05  upon the licensed premises.  Now, in order to determine

06  whether or not this regulation applies, we need to

07  decide whether or not the parking lot, which is

08  approximately 100 yards from the casino's, the gaming

09  boat's, entrance, is indeed part of the licensed

10  premises. 

11         Now, the law dictionary did not give me a

12  definition of the word, "upon."  However, it's

13  considered synonymous with the word "on" and the law

14  dictionary did define "on" as meaning, "connected with

15  or attached to."  So my conclusion is that the parking

16  lot owned and monitored by the casino, even though

17  within a hundred yards of the gaming boat's entrance,

18  is so much connected with the President Casino so as to

19  constitute being upon the licensed premises. 

20         Now, the President Casino does make a good

21  argument that the casino or the Commission's own

22  regulations has a definition that places a parking lot

23  with the term "support facility," being separate and

24  apart from the licensed premises.  In reading that

25  regulation -- and let me cite that for you.  Regulation

 

 

 

00012

01  11 CSR45-1.090, Paragraph 19 and Letter H.  That

02  regulation actually includes several things in its

03  definition of a support facility, including offices and

04  river boats.  So it's my belief that a support facility

05  can also be located upon the licensed premises. 

06         Also of note is the regulation that deals with

07  making an application for a license.  Regulation 4.030,

08  Paragraph 9, actually requires the applicant to give a

09  description of the parking facility.  So it appears to

10  me that the parking lot is, indeed, an important part

11  of the licensed premises. 

12         So it is my recommendation that cause does

13  indeed exist for disciplining the President Casino for

14  its failure to prevent misconduct when its employees

15  allowed a fellow employee, who had committed property

16  damage with his erratic driving, to drive away again. 

17  So part two, I find a violation of that regulation. 

18         Now, as to part three of that regulation, which

19  requires the licensee to immediately report to law

20  enforcement authorities any illegal or violent acts

21  committed on or about the licensed premises, I find

22  that the evidence did show compliance by the President

23  Casino.  The police were indeed called.  The police

24  arrived at the scene and the time frame was within the

25  definition of immediately.  So my recommendation is

 

 

 

0013

01  that no discipline be asserted for the violation

02  alleged with regard to part three of the regulation

03  requiring contact with law enforcement officials. 

04         Now, the next issue is the amount of the

05  monetary penalty.  The penalty asserted by the

06  Commission staff is $50,000.  My recommendation is that

07  that amount is excessive if we look at the preliminary

08  order alleging violations of three separate parts of

09  this regulation and that alleged violations of three

10  parts of the regulation constitute a $50,000

11  forfeiture. 

12         My recommendation is that only two parts of that

13  regulation have been violated.  Therefore, it would be

14  appropriate to reduce the proposed forfeiture amount,

15  and what I'd recommend is that if we decide that each

16  part of that regulation, each of the three parts are

17  given equal weight, then for having violated two of

18  the three parts of that regulation, it would seem

19  appropriate to take two-thirds of the proposed penalty

20  and arrive at three, excuse me, $33,333 as the

21  recommended forfeiture.  I found nothing that would say

22  that any one of the three parts of that regulation

23  deserve any more weight than the other, and I

24  found nothing that said that if all three parts were

25  violated, that a $50,000 would be appropriate.  But

 

 

 

00014

01  since one part I find not to have been violated, the

02  forfeiture, my recommendation, is that it be reduced.

03               CHAIRMAN BARTCH:  Any discussion?

04               MR. MULLALLY:  I think, first, it would be

05  appropriate to hear from the licensee.  They have

06  submitted a written brief.  If they desire to say

07  anything, then they should do that. 

08               CHAIRMAN BARTCH:  Does the licensee --

09               MR. PAUL LITTLETON:  If I may?

10               CHAIRMAN BARTCH:  Yes, you may.

11               MR. LITTLETON:  If I could be seated?

12               CHAIRMAN BARTCH:  Absolutely.

13               MR. LITTLETON:  Thank you.  Mr. Chairman,

14  members of the Commission, my name is Paul Littleton. 

15  I'm an attorney for the Brasher Law Firm here in St.

16  Louis, Missouri, and our office represented the

17  President Casino at the hearing in March of 2005. 

18         It's our position that Mr. Stark got the

19  decision right the first time.  The change in the

20  findings are not appropriate in our view, because

21  they're not supported in the evidence.  The finding

22  that the President Casino failed to present, prevent

23  unlawful conduct occurring upon the premises is related

24  to the assumption that the individual who drove from

25  the parking lot the second time was intoxicated. 

 

 

 

00015

01         The findings of fact before you in paragraphs 12

02  and 13 in findings of fact, state that Mr. Foerste

03  returned to the parking lot a second time, and at that

04  time, had a conversation with a Mr. Williams, an

05  employee of President Casino.  And Mr. Williams, then

06  has stated in the proposed findings of fact, stated

07  that he observed that Mr. Foerste appeared -- that he

08  may have been drinking.  Now, that is the basis for the

09  unlawful conduct, the conclusion being or the

10  assumption, that Mr. Foerste was, in fact, intoxicated. 

11  The conclusion of law for the unlawful conduct

12  specifically refers back to this finding of fact. 

13         We don't think the facts support that.  The

14  statement in the record by Mr. Williams is not that Mr.

15  Foerste appeared to be intoxicated but simply that Mr.

16  Foerste appeared that he may have been drinking.  So

17  the finding of fact that Mr. Williams stated that Mr.

18  Foerste appeared intoxicated is not supported by the

19  facts.  And that is the basis for the alleged unlawful

20  conduct, the initial violation that is being presented

21  to you this morning. 

22         The second issue has to do with where the

23  violation occurred.  And Mr. Stark has explained our

24  position that the regulations define a parking lot,

25  particularly at a distance of 100 yards, we think, as a

 

 

 

00016

01  support facility.  That is the regulation that the

02  Commission has adopted as part of its definitions. 

03  That is something different, a support facility is

04  something different than a licensed premises.  And the

05  hearing officer has also talked about what the

06  definition or meaning of the word "upon" is and that --

07  we agree that, that is the, the given definition, that

08  it is somewhat interchangeable with the word "on". 

09         I see some hesitation about my comments, but let

10  me point out that the particular regulation with which

11  the President is charged with violating requires

12  unlawful conduct upon licensed premises.  The following

13  regulation that talks about failure to report to local

14  authorities incidences of unlawful conduct, refers to

15  incidents that occur upon or about the licensed

16  premises.  The regulation that we're discussing simply

17  says upon.  And Mr. Stark has talked about that. 

18         But if you talk about what's meant by licensed

19  premises, I think it's clear that Mr. Stark got it

20  right the first time.  He concluded the first time that

21  the licensed premises meant inside the casino facility. 

22  We think that's the proper view and that Mr. Stark got

23  the finding of fact and conclusions of law right the

24  first time and we would ask that the Commission adopt,

25  rather than the most recent finding of fact and

 

 

 

00017

01  conclusions of law, but the original findings of Mr.

02  Stark presented at the September 28 meeting.  Thank

03  you.

04               CHAIRMAN BARTCH:  Thank you, sir. 

05               MR. MULLALLY:   Mr. Chairman,

06  Commissioners, Assistant Attorney General Jane Rackers

07  is here, and might have something to add to that.

08               MS. JANE RACKERS:  I don't.  Thank you.

09               MR. MULLALLY:  The only -- I think from

10  the staff's perspective, there's one thing that sticks

11  out here was that we believe that the failure

12  to report is a very serious issue, has always been a

13  very serious issue, and has been treated seriously by

14  this Commission.  I don't think that we have ever put

15  such tight restraints on disciplinary penalties that we

16  say, "Well, if it's one count, it's $15,000; if it's

17  two counts, it's $30,000."  It's always been the

18  seriousness of the underlying conduct.  So whether it's

19  one count or two counts, I don't necessarily think that

20  is the critically relevant factor in determining the

21  amount of penalty.

22               CHAIRMAN BARTCH:  And, you know, another

23  factor here is that I don't believe that we're trying

24  to convict someone of drinking while driving.  You

25  know, we're simply saying that the President had a

 

 

 

00018

01  responsibility when they appeared to have somebody that

02  had been drinking was to try to do something about

03  that, as any citizen would have before you that someone

04  on the road, if in fact, was drinking, that's true.  I

05  don't think we are trying to convict somebody of

06  drinking while driving.  It's a different standard. 

07  It's a different set, and it is very critical that when

08  something happens that they report to the Commission

09  immediately, and they did not do that. 

10         Any other discussion from the Commission?

11               COMMISSIONER HINRICHS:  I thought it was

12  disturbing that they dismissed the police.  That was,

13  that bothered me that they called the police, and when

14  the police arrived, they said they'd take care of it

15  internally.  The amount of damage that apparently

16  happened -- I haven't had very much experience with

17  this, of course, but with automobile accidents, usually

18  when there's physical damage, the police get involved,

19  and I was surprised the police were so willing to leave

20  and that they said they'd take care of it internally. 

21  That disturbed me.

22               COMMISSIONER BIELE:  I'd like to make a

23  motion that the fine be the original amount that was

24  assessed by the Commission of $50,000.

25               COMMISSIONER HINRICHS:  Second.

 

 

 

00019

01               CHAIRMAN BARTCH:  The motion is seconded. 

02  Is there any further discussion?  If not, please call

03  the roll.

04               MS. FRANKS:  Chairman Bartch?

05               CHAIRMAN BARTCH:  Approved.

06               MS. FRANKS:  Commissioner Hinrichs?

07               COMMISSIONER HINRICHS:  Approved.

08               MS. FRANKS:  Commissioner Biele?

09               COMMISSIONER BIELE:  Approved.

10               MS. FRANKS:  Commissioner Jones?

11               COMMISSIONER JONES:  Approved.

12               MS. FRANKS:  Commissioner Shull?

13               COMMISSIONER SHULL:  Approved.

14               MR. MULLALLY:  So just to make sure the

15  record is clear, the motion would be to amend -- I

16  should have stopped.  I think what we need is a motion

17  to adopt the hearing officer's recommendations,

18  however, amending the final order to reflect that the

19  fine be $50,000, rather than the $33,333 that is in the

20  order.  I think that that's the motion that we'll need

21  and we'll need to vote again.  Do you agree?

22               COMMISSIONER HINRICHS:  So we're going

23  back to disciplinary, what is it, DC-04-197?? 

24               MR. MULLALLY:  Yes.  So we need a motion

25  to amend the, amend --

 

 

 

00020

01               CHAIRMAN BARTCH:  Amend 05-080.

02               MR. MULLALLY:  Well, amend the

03  hearing officer's recommendation in Case 04-197, so

04  that the final order now reads that the amount of the

05  penalty assessed against the petitioner shall be $50,000.

06               COMMISSIONER BIELE: So be it.

07               COMMISSIONER JONES:  Second.

08               CHAIRMAN BARTCH:  Seconded.  Please call

09  the roll.

10               MS. FRANKS:  Chairman Bartch?

11               CHAIRMAN BARTCH:  Approved.

12               MS. FRANKS:  Commissioner Hinrichs?

13               COMMISSIONER HINRICHS:  Approved.

14               MS. FRANKS:  Commissioner Biele?

15               COMMISSIONER BIELE:  Approved.

16               MS. FRANKS:  Commissioner Jones?

17               COMMISSIONER JONES:  Approved.

18               MS. FRANKS:  Commissioner Shull?

19               COMMISSIONER SHULL:  Approved.

20               MR. MULLALLY:  Now, we'll need a motion

21  adopting that order as amended.

22               CHAIRMAN BARTCH:  We need a motion to

23  adopt 05-080 then?

24               MR. MULLALLY:  Yes.

25               CHAIRMAN BARTCH:  Someone give me a motion

 

 

 

00021

01  for that? 

02               COMMISSIONER BIELE:  I will.

03               COMMISSIONER HINRICHS:  Seconded.

04               CHAIRMAN BARTCH:  Any further discussion

05  now?  Please call the roll. 

06               MS. FRANKS:  Chairman Bartch?

07               CHAIRMAN BARTCH:  Approved.

08               MS. FRANKS:  Commissioner Hinrichs?

09               COMMISSIONER HINRICHS:  Approved.

10               MS. FRANKS:  Commissioner Biele?

11               COMMISSIONER BIELE:  Approved.

12               MS. FRANKS:  Commissioner Jones?

13               COMMISSIONER JONES:  Approved.

14               MS. FRANKS:  Commissioner Shull?

15               COMMISSIONER SHULL:  Approved.

16               MS. FRANKS:  By your vote, you've adopted

17  Resolution Number 05-080, as amended.

18               MR. MULLALLY:  Isn't Roberts Rules

19  wonderful?  If Hearing Officer Stark could return,

20  we'll move on to the next case.

21               MR. STARK:  The next case is identified as

22  letter D, Mary Ann Keller.  Ms. Keller, as a licensee,

23  is employed as a count room manager.  She supervises

24  the coin room and drop personnel.  An incident occurred

25  on October 16, 2003, in which a bill validator box was

 

 

 

00022

01  left in the count room with assets still contained

02  within it.  The actual value of the money found was

03  $3.50.  But no one could determine who was responsible

04  for the contents of that validator box. 

05         Now, Ms. Keller was not present on October 16,

06  2003.  She was not working that day, but the internal

07  control standards do require proper accounting and the

08  removal of money from the bill validator boxes, and

09  also provides that there should be a written report

10  with each bill validator box.  Because the proper

11  accounting did not occur, the preliminary order

12  asserted an eight-hour suspension against Ms. Keller,

13  who, as the supervisor, was responsible for assuring

14  that there was proper accounting and that her employees

15  were conducting their work accordingly. 

16         From the hearing, I had found that the strict

17  compliance with these internal standards did not occur,

18  that Ms. Keller was, indeed, responsible for the

19  compliance and she failed to insure that compliance. 

20  Therefore, the recommendation is that the eight-hour

21  suspension in this case is appropriate.  And that would

22  be my recommendation.

23               CHAIRMAN BARTCH:  Is Ms. Keller in the

24  audience?  No.  Do you have a motion?

25               COMMISSIONER HINRICHS:  Move to approve

 

 

 

00023

01  Resolution Number 05-081.

02               COMMISSIONER JONES:  Second.

03               CHAIRMAN BARTCH:  Further discussion?  If

04  not, please call roll.

05               MS. FRANKS:  Chairman Bartch?

06               CHAIRMAN BARTCH:  Approved.

07               MS. FRANKS:  Commissioner Hinrichs?

08               COMMISSIONER HINRICHS:  Approved.

09               MS. FRANKS:  Commissioner Biele?

10               COMMISSIONER BIELE:  Approved.

11               MS. FRANKS:  Commissioner Jones?

12               COMMISSIONER JONES:  Approved.

13               MS. FRANKS:  Commissioner Shull?

14               COMMISSIONER SHULL:  Approved.

15               MS. FRANKS:  By your vote, you've adopted

16  Resolution Number 05-081.

17               MR. STARK:  Commissioners, the next case

18  is identified as letter E, Mr. Walter Reed.  Mr. Reed,

19  as a level II occupational licensee, was employed as a

20  tables game supervisor.  On February 19, 2004, he was

21  inspecting a new deck of playing cards for a gaming

22  table when he discovered that the playing card deck was

23  missing one card, a six of diamonds.  Appropriately, he

24  did not permit that deck of cards to be used.  He

25  withdrew it from being played on the table.  He did

 

 

 

00024

01  write up a card discrepancy report indicating the

02  defect in the deck of cards.  However, the problem was

03  that he did not inform the Commission's agent on duty

04  of this problem with the missing card. 

05         He -- let me start with a time line here.  The

06  discovery that Mr. Reed made was at 5:15 p.m.  He wrote

07  up his report immediately thereafter, but he waited

08  until 7:00 p.m. to inform a supervisor of the missing

09  card.  The supervisor, in turn, informed another

10  employee of the casino who did not get the report to

11  the Commission's agent until 9:15 p.m. that night.  The

12  problem is that Mr. Reed, himself, did not make a

13  report to the Gaming Commission. 

14         Now, apparently, the casino had some type of

15  chain of command reporting, but it's my conclusion as a

16  licensee and holder of an individual license, Mr. Reed,

17  himself, had the obligation to report to the Commission

18  when a missing card was found.  The discipline of an

19  eight-hour suspension is -- I consider to be

20  appropriate and that would be my recommendation.

21               CHAIRMAN BARTCH:  Is Mr. Reed in the

22  audience?

23               COMMISSIONER HINRICHS:  I move to approve

24  Resolution Number 05-082.

25               COMMISSIONER BIELE:  Seconded.

 

 

 

00025

01               CHAIRMAN BARTCH:  Any further discussion? 

02  If not, please call the roll.

03               MS. FRANKS:  Chairman Bartch?

04               CHAIRMAN BARTCH:  Approved.

05               MS. FRANKS:  Commissioner Hinrichs?

06               COMMISSIONER HINRICHS:  Approved.

07               MS. FRANKS:  Commissioner Biele?

08               COMMISSIONER BIELE:  Approved.

09               MS. FRANKS:  Commissioner Jones?

10               COMMISSIONER JONES:  Approved.

11               MS. FRANKS:  Commissioner Shull?

12               COMMISSIONER SHULL:  Approved.

13               MS. FRANKS:  By your vote, you've adopted

14  Resolution Number 05-082.

15               MR. STARK:  The next case is identified by

16  letter F, Mr. Gregory Gay.  Mr. Gay, a level II

17  occupational licensee, worked as a security officer on

18  the casino floor.  Part of his job was to take casino

19  tokens to fill the casino gaming machines with these

20  tokens.  He was handling on June 21, 2004, a hopper bag

21  full of coins, or the tokens.  And at approximately

22  1:10 p.m., he and another fellow employee misplaced one

23  of the hopper bags containing five hundred $1 tokens. 

24         Upon realizing that he was missing this hopper

25  bag, Mr. Gay went back, backtracked, tried to find the

 

 

 

00026

01  missing bag.  At approximately 1:28 p.m., a patron of

02  the casino found the missing bag, and it wasn't until

03  about 30 minutes after locating, or after the patron

04  had found the missing bag, that a report was made to

05  the agent on duty. 

06         So again, this is a problem of not immediately

07  reporting to the Commission any problem on the casino

08  floor.  That should have been reported immediately.  So

09  there's like a 50-minute delay in getting a report to

10  the Gaming Commission agent.  And for that, I do find

11  grounds for discipline and the eight-hour suspension

12  recommended by the Commission staff was appropriate,

13  and that would be my recommendation.

14               CHAIRMAN BARTCH:  Is Mr. Gay in the

15  audience?  Do we have a motion?

16               COMMISSIONER HINRICHS:  I move to approve

17  Resolution Number 05-083.

18               COMMISSIONER BIELE:  Seconded.

19               CHAIRMAN BARTCH:  Any further discussion? 

20  If not, please call the roll.

21               MS. FRANKS:  Chairman Bartch?

22               CHAIRMAN BARTCH:  Approved.

23               MS. FRANKS:  Commissioner Hinrichs?

24               COMMISSIONER HINRICHS:  Approved.

25               MS. FRANKS:  Commissioner Biele?

 

 

 

00027

01               COMMISSIONER BIELE:  Approved.

02               MS. FRANKS:  Commissioner Jones?

03               COMMISSIONER JONES:  Approved.

04               MS. FRANKS:  Commissioner Shull?

05               COMMISSIONER SHULL:  Approved.

06               MS. FRANKS:  By your vote, you've adopted

07  Resolution Number 05-083.

08               MR. STARK:  The next matter is identified

09  by letter G, Mr. Roberto Perez.  Mr. Perez is the

10  holder of a level II occupational license working as a

11  cage chip manager.  He supervises several employees,

12  but on the night of September 4, 2004, he instructed

13  one of his employees to manage two separate windows in

14  two separate locations all at the same time. 

15         Previous to September 4, 2004, the situation of

16  having one employee operate two different windows at

17  the same time was brought to the attention of the

18  casino and the auditors.  The Gaming Commission

19  auditors had identified that as a problem and had

20  told, apparently, several employees.  However, Mr.

21  Perez did not, was not told by the auditors, did not

22  get the information that it was a problem to have one

23  employee operate two windows at the same time. 

24  However, this employee had heard that this was a

25  problem, a regulatory compliance problem, and had

 

 

 

00028

01  indicated to Mr. Perez that it was not appropriate for

02  her to be operating the two windows at the same time. 

03  Mr. Perez indicated that she should do as she's told,

04  and that he would take care of any problem with

05  operating two windows by one employee.  However, Mr.

06  Perez did not follow up to find out from anyone else

07  whether this is a problem.  The employee continued that

08  night to operate those two windows by herself. 

09         The auditors had indicated that that was not the

10  appropriate way to protect the assets of the casino and

11  Mr. Perez -- one argument was, of course, he didn't

12  have notice that this was a problem.  But none of the

13  regulations specifically say, thou shall not operate

14  two windows with one employee, which is true.  There is

15  no regulation that specifically says that. 

16         However, at the government agency, there is some

17  deference given to interpretation and it was, it's my

18  conclusion that upon instruction from the auditors as

19  to what activity is necessary to protect casino assets,

20  that those instructions should have been followed and

21  that Mr. Perez, even though he wasn't informed by his

22  own supervisor, he had knowledge that it was a problem

23  from his own employee and he should have followed

24  through with some further investigation of his own.  As

25  such, I find cause exists for discipline and that the

 

 

 

00029

01  16-hour suspension is an appropriate amount of

02  discipline for this case.  And that would be my

03  recommendation.

04               CHAIRMAN BARTCH:  Is Mr. Perez present? 

05  No?  Can we have a motion?

06               COMMISSIONER HINRICHS:  I move to approve

07  Resolution Number 05-084.

08               COMMISSIONER BIELE:  Seconded. 

09               CHAIRMAN BARTCH:  Any further discussion?

10               COMMISSIONER BIELE:  Is that something we

11  should put in our regulation to cover that, a definite

12  -- saying that they should not --

13               MR. MULLALLY:  We certainly can.

14               COMMISSIONER BIELE:  I'll just ask staff

15  to take a look at it and see if it's something that

16  should be added, something they think should be added. 

17  That's all I have.

18               CHAIRMAN BARTCH:  Any other discussion? 

19  If not, please call the roll.

20               MS. FRANKS:  Chairman Bartch?

21               CHAIRMAN BARTCH:  Approved.

22               MS. FRANKS:  Commissioner Hinrichs?

23               COMMISSIONER HINRICHS:  Approved.

24               MS. FRANKS:  Commissioner Biele?

25               COMMISSIONER BIELE:  Approved.

 

 

 

00030

01               MS. FRANKS:  Commissioner Jones?

02               COMMISSIONER JONES:  Approved.

03               MS. FRANKS:  Commissioner Shull?

04               COMMISSIONER SHULL:  Approved.

05               MS. FRANKS:  By your vote, you've adopted

06  Resolution Number 05-084.

07               MR. STARK:  The next case is letter H, Ms.

08  Cynthia Bolden.  Ms. Bolden is the holder of a level

09  II occupational license.  This is a case of failure to

10  update information on the application.  Ms. Bolden made

11  her application for a license on October 29, 2001.  The

12  application process requires you to identify all and

13  any criminal offenses, arrests in your past history,

14  but it also requires you to update that information

15  within 10 days of any change in that information that

16  you initially placed upon your application. 

17         Now, on September 15, 2003, a criminal case was

18  filed against Ms. Bolden alleging a charge of

19  misdemeanor passing a bad check.  Ms. Bolden did

20  receive a summons to appear in court.  She did appear

21  in court on November 6, 2003, entering a guilty plea. 

22  Ms. Bolden failed to report the fact that she was

23  summoned to court on a charge of passing a bad check. 

24  There was no evidence that she informed the Commission

25  about her guilty plea of November 6, 2003. 

 

 

 

00031

01         She indicated in her testimony that she failed

02  to inform the Commission of the notification of the

03  charge of the misdemeanor crime, but she claims that

04  she did inform the Commission about her guilty plea in

05  November of 2003.  However, there is no paperwork

06  presented, no names given of whom she may have reported

07  her guilty plea.  So my finding is that the basis of

08  failure to report is adequate grounds for discipline. 

09  And, secondly, the crime of passing a bad check is

10  grounds by itself, as well, for discipline. 

11         In her testimony, she indicated that it was her

12  sister that caused the bounced check, but, however, the

13  criminal court determined that Ms. Bolden, herself, was

14  responsible.  So I find that the crime itself is Ms.

15  Bolden's responsibility.  And for that, the revocation

16  of her level II occupation license is appropriate and

17  that would be my recommendation, that Ms. Bolden's

18  license be revoked.

19               MR. MULLALLY:  Ms. Bolden is in the

20  audience.  Would you like to come up?

21               MS. CYNTHIA BOLDEN:  Yes.  The first thing I need

22  to say is I'd like to thank you for letting me take the

23  opportunity to speak on my behalf.  Early in 2001, I

24  realized that my husband had a drug problem.  After ten

25  years of being a stay-at-home mom, I needed to make

 

 

 

00032

01  ways to make positive changes in my life, as well as

02  the lives of my children. 

03         In October 2001, I accepted a job starting out

04  as a slot attendant.  Due to the motivation and the

05  dedication that I've shown in my job, I was promoted to

06  a slot supervisor shortly after that.  The company saw

07  the continuation of the behaviors and promoted me to a

08  cage -- promoted me to a full-time cage supervisor in

09  2004.  This is the job that I currently hold today. 

10         I feel that the revocation is too harsh of a

11  punishment for what has happened.  I know that I've

12  made mistakes due to hard times.  And being a single

13  mom, revocation of my gaming license would end my

14  career.  I have worked my way into a company that

15  requires a high school diploma, but not a college

16  education.  I have made a positive impact in not only

17  Harrah's, but also in my children's lives. 

18         I ask that you please lessen this to a

19  suspension and not a revocation.  In closing, I'd like

20  to thank you for letting me take the time to let me

21  speak.

22               CHAIRMAN BARTCH:  Any further discussion? 

23  Okay. 

24               COMMISSIONER JONES:  I'd like to know how

25  much was the check for?  Maybe she can answer that. 

 

 

 

00033

01               MR. MULLALLY:  Ms. Bolden.  Why don't you

02  ask her to tell you the circumstances concerning the

03  bounced check?  

04               COMMISSIONER JONES:  The question was how

05  much was the check for?  And since you're back here,

06  why don't you give us the circumstances around that

07  event?

08               MS. BOLDEN:  It was for the registration

09  of a vehicle to get back and forth to work.  The car is

10  registered in my sister's name and she said that she

11  would help me pay the taxes on the car.  It was, I

12  believe, $862.  And my sister was on my checking

13  account at the time and she said she would help me pay

14  the taxes.  But she failed to put the $300 that she

15  would help me with into the account.  When the check

16  did not clear the first time, she told me because the

17  car is in her and her husband's name, that they would

18  assume the responsibility and to take it upon

19  themselves to make sure that the check cleared, but

20  they did not. 

21               CHAIRMAN BARTCH:  Any other questions of

22  discussion?  Can we have a motion?

23               COMMISSIONER SHULL:  I would move that DC-

24  04-200 be amended to a 15-day suspension, as opposed to

25  license revocation.

 

 

 

00034

01               CHAIRMAN BARTCH:  Do we have a second? 

02               COMMISSIONER JONES:  I second.

03               CHAIRMAN BARTCH:  Is there any further

04  discussion?  If not, would you please call the roll?

05               MS. FRANKS:  Chairman Bartch?

06               CHAIRMAN BARTCH:  Approved.

07               MS. FRANKS:  Commissioner Hinrichs?

08               COMMISSIONER HINRICHS:  Approved.

09               MS. FRANKS:  Commissioner Biele?

10               COMMISSIONER BIELE:  Approved.

11               MS. FRANKS:  Commissioner Jones?

12               COMMISSIONER JONES:  Approved.

13               MS. FRANKS:  Commissioner Shull?

14               COMMISSIONER SHULL:  Approved.

15               CHAIRMAN BARTCH:  Then we also now need

16  approval for 05-085 as amended.  Is that correct?

17               MR. MULLALLY:  That's correct.

18               CHAIRMAN BARTCH:  Motion for that?

19               COMMISSIONER SHULL:  I move to approve

20  05-085.

21               COMMISSIONER HINRICHS:  I second.

22               CHAIRMAN BARTCH:  Any further discussion? 

23  Please call the roll.

24               MS. FRANKS:  Chairman Bartch?

25               CHAIRMAN BARTCH:  Approved.

 

 

 

00035

01               MS. FRANKS:  Commissioner Hinrichs?

02               COMMISSIONER HINRICHS:  Approved.

03               MS. FRANKS:  Commissioner Biele?

04               COMMISSIONER BIELE:  Approved.

05               MS. FRANKS:  Commissioner Jones?

06               COMMISSIONER JONES:  Approved.

07               MS. FRANKS:  Commissioner Shull?

08               COMMISSIONER SHULL:  Approved.

09               MS. FRANKS:  By your vote, you've adopted

10  Resolution Number 05-085 as amended.

11               MS. CYNTHIA BOLDEN:  Thank you.

12               MR. STARK:  The next item is identified at

13  letter I, Mr. Rafferty Crawford.  Mr. Crawford had a

14  level II occupational license.  A disciplinary action

15  was filed against him.  He requested a hearing.  I

16  scheduled the hearing for October 21, 2005.  However,

17  Mr. Crawford allowed his license to expire, the

18  expiration date being September 30, 2005.  Therefore,

19  my determination was that there was no need for a

20  hearing, in that there was no jurisdiction to

21  discipline a license in that Mr. Crawford no longer had

22  a license, having had it expire.  So this case is --

23  the recommendation would be a dismissal of the

24  preliminary order for disciplinary action for lack of

25  subject matter jurisdiction.

 

 

 

00036

01               CHAIRMAN BARTCH:  You wouldn't think he'd

02  be here, but Mr. Crawford?  Any other discussion?

03               COMMISSIONER HINRICHS:  I move to approve

04  Resolution Number 05-086.

05               COMMISSIONER JONES:  Second.

06               CHAIRMAN BARTCH:  Any other discussion? 

07  If not, please call the roll.

08               MS. FRANKS:  Chairman Bartch?

09               CHAIRMAN BARTCH:  Approved.

10               MS. FRANKS:  Commissioner Hinrichs?

11               COMMISSIONER HINRICHS:  Approved.

12               MS. FRANKS:  Commissioner Biele?

13               COMMISSIONER BIELE:  Approved.

14               MS. FRANKS:  Commissioner Jones?

15               COMMISSIONER JONES:  Approved.

16               MS. FRANKS:  Commissioner Shull?

17               COMMISSIONER SHULL:  Approved.

18               MS. FRANKS:  By your vote, you've adopted

19  Resolution Number 05-086.

20               MR. STARK:  I believe that's all my cases.

21               CHAIRMAN BARTCH:  Thank you. 

22               MR. MULLALLY:   Mr. Chairman,

23  Commissioners, before we move onto the next agenda

24  item, it has been suggested to me that it may be a more

25  efficient use of the Commission's time that some of

 

 

 

00037

01  these cases that involve lesser penalties, eight-hour,

02  sixteen-hour suspensions, could be handled by the

03  Executive Director with the option of, in unusual

04  circumstances, of bringing them before the Commission. 

05  I think there have been a couple cases, two, three

06  eight-hour suspensions on this agenda.  One of them had

07  50 to 60 pages of material, and the other two had

08  between 35 and 45 pages of material.  There was a

09  sixteen-hour suspension that involved you reading

10  between 75 and 80 pages of material.  And so I just

11  thought since that matter was brought to my attention,

12  I would just throw it out to you, as well as a

13  potential policy change you would like the staff to

14  pursue. 

15               CHAIRMAN BARTCH:  You're saying that you

16  would make the final decision?

17               MR. MULLALLY:  Yes.

18               CHAIRMAN BARTCH:  Instead of the

19  Commission?

20               MR. MULLALLY:  Rather than the, the

21  appeals of eight-hour, sixteen-hour, whatever threshold

22  you decide.  Certain -- I would say anything less than

23  a three-day suspension, those matter would be -- the

24  Hearing Officer would present those matters to the

25  Director and the Director would dispose of those cases,

 

 

 

00038

01  unless the Director determined that there were issues

02  sufficient that it merited bringing it before the whole

03  Gaming Commission.              

04               COMMISSIONER JONES:  In the past, how many

05  of those have we had?  This is the first time I've seen

06  a -- 

07               MR. MULLALLY:  Oh, I'd say you have a

08  couple a month that involve eight- or sixteen-hour

09  suspensions.  Wouldn't you say, Steve?

10               CHAIRMAN BARTCH:  I think I would rather

11  you look at that internally as to make a staff

12  recommendation and tell us the pros and cons and let us

13  think about it and then make a decision.

14               MR. MULLALLY:  It's really subject for the

15  Commission.  I mean, it's the, --

16               CHAIRMAN BARTCH:  Right.

17               MR. MULLALLY:  I think it's the

18  determination -- the Commission needs to tell us that. 

19  Is it, for eight- or sixteen-hour suspension, is

20  it an efficient use of the Commission's time looking

21  through 80 to 100 pages of material, or is that

22  something that you would like to delegate? 

23               CHAIRMAN BARTCH:  I guess that it is time-

24  consuming, but I do think that they come before the

25  Commission -- I'm not against a recommendation by the

 

 

 

0039

01  Executive Director, possibly.  But the Executive

02  Director is part of staff, and this is a separation.  I

03  mean, this is a total different entity here, and so I

04  definitely think that the Commission needs to make the

05  final decision.

06               COMMISSIONER JONES:  And it's happened

07  today, I think, on two of them, we've changed the

08  directions of the different motions.

09               MR. MULLALLY:  I just -- it was brought to

10  my attention and I thought I would raise it. 

11               CHAIRMAN BARTCH:  Unless the Commission

12  thinks different, I think we ought to just think about

13  it a while.

14               MR. MULLALLY:  Very good.  The next item

15  on the agenda is the consideration of the licensure of

16  Isle of Capri-Boonville.  Tom Campbell, who represents

17  Isle of Capri, is here, along with Kim Hardy, the

18  general manager of Boonville, and a number of other

19  staff people.  I will turn the podium over to them to

20  make their presentation.

21               MR. TOM CAMPBELL:  Good morning, Mr. Chairman,

22  Commissioners, Director Mullally.  My name is Tom

23  Campbell.  I am a partner with the St. Louis law firm

24  of Gallop, Johnson, and Neuman, which serves as

25  regulatory counsel for the Isle of Capri Casinos in

 

 

 

00040

01  Missouri.  We are here before you today to substantiate

02  the renewal of the Class A license, which IOC-Boonville

03  has held for a number of years. 

04         To my left is Kim Hardy, who is General Manager

05  of the Boonville facility, and he will introduce his

06  staff and launch into the PowerPoint presentation.  I

07  would -- and correct me if I'm wrong, but I believe

08  your admonition to licenses in the past is brevity is

09  appreciated and with the length of today's agenda, I

10  presume there would be an admonition you will convey to

11  us, as well.

12               MR. KIM HARDY:  Mr. Chair, Commissioners, good

13  morning.  Before we get started with our presentation

14  for your review and, hopefully, acceptance this

15  morning, I'd like to introduce some of my staff.  I

16  have with me today my senior team, Reggie Burt,

17  Marketing; Bari Richter, Operations; Roy Evans, who has

18  been the point on this project, in our Finance.  I

19  could be calling on them throughout the presentation. 

20         Also, we have Mayor Blanck from Boonville. 

21               MAYOR DANIELLE BLANCK:  I'm not on the staff.

22               MR. HARDY:  I didn't know that until

23  today.

24         We're starting out with some overviews of the

25  casino.  This is the casino floor.  This is our

 

 

 

00041

01  Tradewinds Snack Bar Restaurant, our buffet.  And I

02  want to bring it to your attention that this photo

03  wasn't taken on a Saturday night.  And this is the

04  overall of the facility, along with the construction of

05  the hotel.  This is our fine dining, our Farraddays'

06  Bistro. 

07         And to get with the presentation, we have

08  combined with our development agreement with the city. 

09  When we presented last time in fiscal 2004, which is

10  our fiscal year, we projected we'd do 65.1 in revenue. 

11  We actually ended up doing 70.3.  In fiscal 2005, we did

12  74.6, and our projected on track for 77.8 for 2006.  So

13  you can see that we've had a good growth there.

14         Admissions.  Projected was 24 or 2.4, actual was

15  2.8.   Fiscal 2005 was 2.6 and our projected admissions

16  is 2.7 for 2006.  Capital investments, initial

17  investment of the project, was $68 million.  Maintenance

18  spent approached $9.8 million.  Hotel and events center,

19  we have already spent on our $17.5 million project, $8.1

20  million, for a total of $86.8. 

21         Our employment or actuals, is 623 team members

22  of November 2, 2003, to 622 of October 2, 2005.  Our

23  breakout, our demographics for our employees, we have 7

24  percent minority.  Boonville is 13 percent.  Average

25  wage per pay period is 17.28.  Percent of salaried

 

 

 

00042

01  employees in minority bracket is 6 percent.  Female

02  actuals, 51 percent, Boonville's 53 percent.  Average

03  wage per pay period is 1.4 for the females, and a

04  percent of salaried employees is 45 percent.  The base

05  line for those salaries that we just mentioned is 1.046

06  and that's the average property-wide. 

07         The residents, most all -- the employees in this

08  case are all from Missouri.  Employee turnover rate is

09  59.8 percent.  And this is something that we've really

10  concentrated on and looked at over the last several

11  months.  What we have concluded is that a third of

12  those folks don't last 90 days.  So our assumption is

13  since we're not getting any negative discharge

14  interviews, that either the people didn't get what they

15  thought they were going to get or they just simply

16  thought that they weren't going to have to work as hard

17  as they were going to, and they've left. 

18         What we've done to try to rectify that problem

19  is we've changed the way that we hire.  And what we've

20  done in the past, the managers have done all the

21  hiring.  We found out that a lot of the times, that

22  people were just hired to do a position.  So if I had

23  to work the weekends, I'm just going to get somebody in

24  there so I don't have to.  And we've changed that to

25  the HR department doing a full screening of our

 

 

 

00043

01  applicants.  Then, whoever that they choose goes to the

02  executive committee, and at least two of us interview

03  that individual employee for hire.  And we just take it

04  up another notch on questioning to make sure they, they

05  know exactly what they are in for.  And so far, over

06  the last four weeks, it's worked out very well.  So

07  hopefully, we'll turn that around.  Unemployment for

08  Cooper County, you can see it as it is, and it's

09  getting very, very tight at 3.8 in 2005. 

10         Purchasing, you can see WBE is .81 percent in 2005,

11  which shows an increase over our last licensing and

12  MBE has gone down a little bit.  I might add here that

13  we aggressively market to the minorities and solicit

14  their participation in our projects.  We can get a lot

15  deeper than that if you should choose to.  We brought

16  some information that kind of changes those

17  figures around when you break out the huge purchases of

18  gaming equipment.  It really does bring our percentages

19  up quite drastically. 

20         Sponsorship contributions at $343,873.  The

21  business line in Boonville, new businesses have been

22  55, and closed businesses, 19, so we're showing an

23  increase of businesses in the area.  Boonville crime

24  rate, you can see that we've run relatively flat from

25  2003 to 2005, with a spike in 4.8 and I believe that

 

 

 

00044

01  was, the spike was attributed to theft and some larceny

02  cases. 

03         Problem Gaming.  We belong to and we

04  aggressively support all the clubs and memberships and

05  resources that are out there for us to use.  Underage

06  gaming, it falls within the same category, which we do

07  offer a Bounty Hunter Program, and that program is that

08  we reward our team members $100 for everyone that they

09  stop at the turnstile that would fall into the gap, or

10  underage gaming. 

11         The purses, the same thing.  We follow all the

12  rules.  Over the licensing period, my recollection

13  doesn't show me or doesn't -- I can't recollect the

14  incidences, but I know that we have had nine over the

15  two-year period.  Six of those were stopped at the

16  turnstile.  Three of them were caught on a cross check

17  with tax at the jackpots.

18         Community services.  This is some of the ones

19  that we really participate in.  Target issues.  Once

20  again, these are the ones that we really targeted this

21  year.  And our mission statement.  And I would be happy

22  to entertain any questions that you all might have.

23               COMMISSIONER HINRICHS:  My first question

24  is always how many women do you have in management,

25  upper management? 

 

 

 

00045

01               MR. HARDY:  Give me just a second.  Did

02  you bring that? 

03               COMMISSIONER HINRICHS:  I didn't find it

04  in here, but we've just gotten this.

05               MR. HARDY:  I know that we've got it. 

06  Forty-five percent of the female employees that we

07  have.

08               COMMISSIONER HINRICHS:  Upper management?

09               MR. HARDY:  As upper management as?

10               COMMISSIONER HINRICHS:  As in the upper

11  management.  The people who run the place, not just,

12  not just on the floor, but in --

13               MR. HARDY:  Out of my directors, I have

14  five directors.  Two of them are female.  Does that

15  answer your question?

16               COMMISSIONER HINRICHS:  That helps.

17               COMMISSIONER JONES:  What type of

18  programs, I guess in the -- in your purchasing from the

19  minorities and women, you only have combined of about 3

20  percent.  I see you have new construction going on.  Do

21  you have an outreach program going on?

22               MR. HARDY:  Yes, sir.  We hired a

23  contractor, Certel, out of Jefferson City, that has

24  historically -- solicits minority groups.  Right now,

25  the information that I'm getting from the contractor, I

 

 

 

00046

01  think they are running just about the same percentages

02  that we are in the participation of the new

03  construction.  They have 4 out of 40.  They -- G&G

04  Mechanical, Watkins Roofing, G&G Specialists, and Walsh

05  Insulation are all in these that are participating in

06  construction.

07               COMMISSIONER JONES:  Engaged in the new

08  construction, as well?

09               MR. HARDY:  Yes, sir.  That's correct.

10               COMMISSIONER HINRICHS:  Four of forty?

11               MR. HARDY:  One percent, four of forty. 

12  We don't have -- you know, we really don't have the

13  opportunity in mid-Missouri of the companies that are

14  out there for us to solicit.  The only thing that I can

15  assure you is that we aggressively go out there and try

16  to find those people by the state's database and other

17  job bases throughout the two years that we've been

18  doing this. 

19               COMMISSIONER HINRICHS:  What's the

20  minority population in Boonville, as a percentage?

21               MR. HARDY:  Thirteen percent?  Yes.   

22               UNIDENTIFIED SPEAKER:  Seven percent.

23               COMMISSIONER HINRICHS:  Thirteen or seven?

24               MR. HARDY:  Seven?  Seven?  Thirteen in

25  the county.  Seven is the Boonville? 

 

 

 

00047

01               UNIDENTIFIED SPEAKER:  Boonville's, yes. 

02  I'm sorry.  It's seven, thirteen percent for Boonville

03  area.  We don't have that broken down to what falls in

04  to the class of what area. 

05               COMMISSIONER HINRICHS:  Those are issues

06  that Mr. Jones and I will always be looking at and it's

07  a question I ask every time we have renewals, is female

08  participation.  Now, I have a cohort who's similarly

09  interested, and we push for the minority participation. 

10  We both consider that very important and whatever

11  efforts you can make in order to improve those numbers,

12  impress us.

13               MR. HARDY:  As do I, Commissioner. 

14               CHAIRMAN BARTCH:  Did you have something?

15               MR. MULLALLY:  Yes, a couple things. 

16  First, Commissioner Jones, Commissioner Hinrichs,

17  reporting quarterly.  Given those numbers, would you

18  like a quarterly report here on the minority issues?

19               COMMISSIONER JONES:  Oh, absolutely.

20               MR. MULLALLY:  Okay.  Second issue I have

21  is, Kim, I noticed in your projections that you have

22  admissions in your, in your pro forma for next year. 

23  However, the last quarter of our fiscal year, 2005,

24  admissions had been declining at a rate of about 5.8

25  percent, and in the first four months of our current

 

 

 

00048

01  fiscal year, we've been -- since July, July through

02  October, admissions are declining at a 3.8 percent

03  rate.  What factors do you take into consideration 

04  in thinking that you're going to have admissions growth

05  with the trend really going downward?

06               MR. HARDY:  Our thought process is that we

07  don't know the stabilization of the past.  We don't

08  know where that should be.  The new property, you have,

09  for lack of better words, a lot of hire tricks, people

10  who just come in to see what you're all about.  They

11  might not even be gamers, but they come in and just

12  look around and they leave.  That is one aspect of it. 

13  Another one is that we have really concentrated on

14  direct marketing this year and not so much -- and over

15  the last couple of years, and not so much on

16  advertising.  With a new hotel in place, that

17  philosophy is going to change a little bit because then

18  we'll be able to utilize advertising throughout, and

19  plus our direct mail.  But when you direct mail just to

20  your customers, it's going to take down your profit

21  because you don't have as many, what we call --

22               MR. MULLALLY:  Customers?

23               MR. HARDY:  Yes.  Or retail, our retail

24  customers.  And hopefully, we're right on our

25  assessment.

 

 

 

00049

01               MR. MULLALLY:  The projected opening date

02  on the hotel again is when?

03               MR. HARDY:  May of 2006.  Shortly. 

04               MR. MULLALLY:  Obviously, that should

05  drive volume.  I'm still not quite understanding what

06  it is that will reverse what is now a seven-month

07  downward trend.

08               MR. HARDY:  We'll be able to pull from

09  further out.  We'll be able to -- we can encroach on

10  the outer cities market from both sides, St. Louis and

11  Kansas City.  We will have people, have rooms to stay

12  and people won't have to make that drive back, one,

13  two, three hours.  Let's assume for the sake of the

14  conversation, is an hour and a half.  We're going to go

15  out there, and we're hoping that that's going to drive

16  admissions. 

17               MR. MULLALLY:  So we'll start seeing this

18  marketing in January? 

19               MR. HARDY:  And, Kevin, I wish I really

20  did have a good answer for it, but this is something we

21  look at by quarter, and it's just -- I can't even

22  explain it.

23               MR. MULLALLY:  Well, it's not just you. 

24  It's a state-wide trend.  I'm not picking on you.  I'm

25  just trying to figure it out.

 

 

 

00050

01               MR. HARDY:  Thank you.

02               MR. MULLALLY:  Mr. Chairman, in terms of

03  reporting quarterly, would you like that in written

04  form or a formal presentation?

05               CHAIRMAN BARTCH:  We've been having

06  written.  Written's fine.  I think written.

07               COMMISSIONER SHULL:  I move to approve

08  Resolution Number 05-087.

09               MR. MULLALLY:  I think the Mayor would

10  like to speak. 

11               MAYOR BLANCK:  No, I'm not a politician. 

12  Okay, Kim.  As you can see, we have a very good

13  relationship with the casino.  I'm Danielle

14  Blanck.  I'm the Mayor of Boonville.  This is our

15  Interim City Administrator and former City

16  Administrator, twenty years ago.  He's my driver today.

17         We are very complimentary of the casino.  They

18  have been excellent citizens of our community since

19  they opened their doors.  The community was very

20  frightened that we were going to have an influx of

21  traffic, crime, whatever.  Neither of which has

22  happened.  The money that we have earned as a result of

23  them being there has been very helpful in our

24  community, and I think you can see that through the

25  financial records that we provided you. 

 

 

 

00051

01         We also try to share this money with the

02  surrounding counties, and this past year, the Council

03  decided to give additional monies to small towns within

04  our county.  We didn't give them very much, a $1,000,

05  some others got $2,000, but all of them were very happy

06  to get that because their budgets, of course, they're

07  small.  And we figure, you know, we have that money and

08  it's nice to spread the wealth around.  Even though we

09  could spend it all if we got a chance. 

10         We also solicit requests from organizations

11  within the community to put together a grant, so to

12  seek a grant application, or at least tell us that they

13  are interested in having some of that money and why

14  they want it.  They send that to the City

15  Administrator.  In fact, we'll be doing that this

16  month, in December, because we'll start our budgeting

17  time.  In January, we'll start talking about budget. 

18  And then we ask those organizations to come to our

19  budget session when we discuss the casino money and

20  tell us why they should have whatever they're asking

21  for.  If you look at our financial statement there, you

22  will see that we have four organizations that we have

23  been very supportive of in the past.  And anyone -- we

24  don't support, tax-supported institutions, or we will

25  try to make it so that it covers the whole community. 

 

 

 

00052

01         As you can see, we give quite a bit of money to

02  the YMCA.  We figure this provides a great service to

03  the community, and they live in one of the, in a

04  building owned by the City and so we figure this is

05  helping to support that building.  And we have

06  invested, we are going to invest over the two to four

07  years -- we proposed three million dollars in

08  preserving and updating this historic building.  Some

09  of you may be familiar with the Kemper Military School,

10  and this is their field house and swimming pool of

11  that facility.  You know, we own all of that,

12  which casino money allowed us to buy.  We are now

13  attempting to sell some of this building, so. 

14         I can say that the casino has been excellent

15  citizens of the community.  Whenever I go ask for money

16  or support in some kind of effort going on, Kim and his

17  people are very willing to help us do that, and

18  their management personnel and other personnel are

19  involved in the community with churches, civic

20  organizations, participating in projects and events

21  that go on in the community.  So we believe that they

22  are excellent members. 

23         A lot of people from Boonville gamble there, but

24  a lot of people just go down there to eat.  Their

25  buffet restaurant is very nice and relatively

 

 

 

00053

01  inexpensive, and their nice restaurant is very nice and

02  expensive, but people go there.  So they have offered,

03  you know, another entertainment outlet for the

04  community. 

05         My understanding is when the hotel opens, they

06  will have entertainment events that will be open to the

07  public, with entertainers coming.  And they have

08  already done that.  Some of you are familiar with Sarah

09  Evans, a country music star, who happens to come from

10  our area.  She was born and raised in New Franklin,

11  Missouri, and she has performed there.  And they

12  anticipate doing more of that, which again, will bring

13  people into the community and entertain our citizens,

14  as well. 

15         If you have any questions, I'd be glad to answer

16  them.  Yes, ma'am.

17               COMMISSIONER HINRICHS:  The money you give

18  to the Y, is that particularly designated towards

19  capital improvements, or have you considered a program

20  that the --

21               MAYOR BLANCK:  This is the Y --

22               COMMISSIONER HINRICHS:  -- that the Y

23  might provide for problem gaming?  You know, I look

24  at the charities that the gaming industry supports, it

25  should have, at least in some part, something to do

 

 

 

00054

01  with helping to alleviate problems with gambling.

02               MAYOR BLANCK:  The $69,000 that we gave them

03  last year is more for program production.  Then we have

04  additional money to do improvements.  That is not part

05  of this right here.  They do have adult

06  programs there.  They really emphasize that youth --

07  have done a wonderful job in providing programs for

08  youth.  And I don't know that that's alleviating

09  gambling problems, but maybe it's alleviating potential

10  gambling problems. 

11               COMMISSIONER HINRICHS:  With the

12  popularity of poker such as it is and the young people

13  getting into it now in such a big way, it seems to me,

14  personally, that efforts to educate young people as to

15  the problems of that kind of gambling would not be

16  inappropriate.

17               MAYOR BLANCK:  Right.  The facility,

18  physical facility, has not allowed itself to do a lot

19  of that.  But as we keep improving it and fixing areas,

20  now they have a computer lab where kids can come down

21  and do that.  They're, you know, they're doing more and

22  more programs that way.  Yeah, they can play computer

23  programs, but I think it's -- I think it is chat rooms. 

24  But the facility, because it has been in disrepair,

25  there are a lot of areas that couldn't be used.  We are

 

 

 

00055

01  slowly getting those fixed, which --

02               COMMISSIONER HINRICHS:  You have to have a

03  place before you can have programs. 

04               MAYOR BLANCK:  That's right.  You have to

05  build it and they will come.  Right?  And they do a lot

06  of things with the high school students.  They have

07  after prom parties down there.  I mean, they are doing,

08  I think, a lot of good for the youth.  And they don't

09  turn anybody away.  And I think our $69,000 helps them

10  do that.

11               CHAIRMAN BARTCH:  You know, it's very

12  encouraging to see the casino being good corporate

13  citizens for your city, and that's what we want. 

14  That's what we want to see happen.  And to me, and I'm

15  sure the Commissioners, also, it's extremely

16  encouraging that you're reaching out to your community,

17  to the county, to the small towns.

18               MAYOR BLANCK:  Thank you.

19               CHAIRMAN BARTCH:  That you're sharing your

20  wealth, so to speak.  I think that's very important and

21  particularly important in the long run, in the long

22  range, as we help do that. 

23               MAYOR BLANCK:  Thank you.

24               CHAIRMAN BARTCH:  So you've done a good

25  job with that and that's very encouraging and it's a

 

 

 

00056

01  good thing.

02               MAYOR BLANCK:  I will have to tell you, if

03  you look on that financial statement, Pettis County,

04  the sheriff and prosecutor in 2003 and 2004, did not get

05  any money.  They got money for the first year.  They

06  didn't get money the second year because we asked them

07  to write us a letter and tell us what they spent the

08  money on and they didn't bother.  So we figured they

09  didn't really care.  So we thought, okay.  So we didn't

10  give them the money.  Well, they did care and they came

11  personally to us, but it was too late then.  So now

12  they're back on, they're back on the docket.  But, you

13  know, if you don't care enough to let us know how

14  you're doing, then maybe you don't care about the money

15  was kind of the Council's opinion, and I kind of agreed

16  with that.  So --

17               CHAIRMAN BARTCH:  I don't think it's

18  unreasonable for them to tell you what they did with

19  the money.

20               MAYOR BLANCK: That's right.  That's right. 

21  Because we did ask that it not be put in their general

22  revenue.  Don't ask questions you don't want to know

23  the answers to.  But they're all using it.  They all

24  needed the money and it has helped them. 

25         And Howard County, which is right across the

 

 

 

00057

01  river from us, has certainly seen an impact with

02  speeding and things.  Because I don't know if you're

03  familiar with the area, but you can go from Columbia to

04  Boonville on Old Highway 40, rather than I-70, and if

05  you drive I-70 very much, you might want to drive Old

06  40.  A lot of the Boonville and New Franklin, Howard

07  County residents do use Old 40 to go back and forth to

08  Columbia.  So they do have an impact from, you know,

09  the casino people coming in.  But it really hasn't been

10  an impact traffic-wise. 

11               CHAIRMAN BARTCH:  Any questions?  Any

12  discussion?

13               MR. MULLALLY:  A couple more issues. 

14               MAYOR BLANCK:  Thank you very much.

15               MR. MULLALLY:  An omission on my part.  We

16  haven't done a renewal in a while.  We do have new

17  members of the Commission.  I probably should outline

18  the procedure before we start it.  The typical

19  procedure is that we hear from the applicant, hear from

20  the home dock city, and then ask if there are any

21  citizens that would like to comment on the application

22  for renewal and then we cover the background

23  investigation.  We have not had any citizens contact

24  the staff requesting permission to speak, but we may,

25  might open it up to the audience.  There may be some

 

 

 

00058

01  that we're not aware of.

02               CHAIRMAN BARTCH:  In fairness to you, I

03  forgot the process, too.  I'll open it up to the

04  audience.  Any comments? 

05               MR. MULLALLY:  All right.  The final part

06  of the presentation is that Deputy Director Steve

07  Johnson will discuss and summarize the results of the

08  staff's background investigation.  That includes both

09  reports by the Highway Patrol and our financial

10  investigation.

11               MR. STEVE JOHNSON:  Thank you, Kevin.  Mr.

12  Chairman, members of the Commission, good morning.  Our

13  investigative team, comprised of Sergeant J.L. Smith,

14  G.D. Davis, as well as Corporal J.M. Preston and our

15  financial investigators, have been involved in an

16  investigation into the suitability of the Isle of Capri-

17  Boonville, for their re-licensing as a class A river

18  boat.  This property was originally licensed on

19  December 6, 2001.  We subsequently renewed on

20  December  6, 2002 and December  6, 2003. 

21         A summary report detailing investigative

22  findings is located under tab J in your reading book,

23  but is in front of you as I speak.  Our investigation

24  included, but was not limited to, the following

25  considerations:  Contacts with public officials,

 

 

 

00059

01  contacts with public agencies, verification of

02  employment information, a physical site inspection,

03  interviews with security and emergency medical

04  personnel, checks with other gaming jurisdictions

05  relative to the Isle of Capri's operations in other

06  jurisdictions, financial suitability, level I and key

07  individual license verifications. 

08         During the course of this investigation, we

09  developed no information that would preclude a

10  recommendation that IOC-Boonville would be found

11  suitable and continue licensure by you, the Commission. 

12  But before we take any questions that you might have

13  relative to the investigation, we do find that our

14  administration, as we look at the revenue sharing plans

15  at each of the properties offered.  And I'd like to

16  commend the mayor on a very aggressive revenue-sharing

17  program that is outlined in your book.  I think it's a

18  very commendable service, and it increases the good

19  will in the surrounding community that they reach out. 

20  I'd be happy to take any questions. 

21               MR. MULLALLY:  Mr. Chairman, based on the

22  investigative report and the conduct of this licensee,

23  it's encouraging to see them reinvest in Missouri as a

24  result of their success.  They've been very successful

25  in that market.  You've heard the City of Boonville. 

 

 

 

00060

01  They're very pleased with them as a perfect citizen,

02  and so the staff recommends that Isle of Capri-

03  Boonville be re-licensed. 

04               COMMISSIONER SHULL:  I would again

05  recommend that we adopt Resolution Number 05-087.

06               COMMISSIONER HINRICHS:  Second.

07               CHAIRMAN BARTCH:  The motion is seconded. 

08  Any further discussion?

09               COMMISSIONER JONES:  Just general

10  information.  How often does for gaming licensure come

11  up for re-licensing? 

12               MR. MULLALLY:  After their initial

13  licensure, for the first two periods of re-licensure,

14  it's one year.  So once you get your license, you get

15  your license, that's good for one year.  Then you have

16  to get it renewed for the next, annually, for the next

17  two years, and then it's on a two-year rotation.  So

18  they will not be back before you for -- this is the

19  last of the one year's?

20               MR. HARDY:  The next will be -- no, this

21  was a two-year.

22               MR. MULLALLY:  This was a two-year?  So

23  they will not be back before you for another two years.

24               COMMISSIONER JONES:  Okay.  All right. 

25               COMMISSIONER HINRICHS:  I have one more

 

 

 

00061

01  question, and that is key and level I persons, there

02  are 34 names on here, of which only the four are

03  female.  I'd like to see a change in that.

04               MR. HARDY:  Yes, ma'am.

05               COMMISSIONER HINRICHS:  And if you want

06  this, you're welcome to it.

07               CHAIRMAN BARTCH:  Further discussion?  If

08  not, please call the roll.

09               MS. FRANKS:  Chairman Bartch?

10               CHAIRMAN BARTCH:  Approved.

11               MS. FRANKS:  Commissioner Hinrichs?

12               COMMISSIONER HINRICHS:  Approved.

13               MS. FRANKS:  Commissioner Biele?

14               COMMISSIONER BIELE:  Approved.

15               MS. FRANKS:  Commissioner Jones?

16               COMMISSIONER JONES:  Approved.

17               MS. FRANKS:  Commissioner Shull?

18               COMMISSIONER SHULL:  Approved.

19               MS. FRANKS:  By your vote, you've adopted

20  Resolution Number 05-087.            

21               MR. MULLALLY:  Mr. Chairman and

22  Commissioners, the next items on the agenda relate to

23  consideration of Preliminary Orders for Discipline.

24  General Counsel would like to make their presentations. 

25               CHAIRMAN BARTCH:  The request has been

 

 

 

00062

01  made that we take a short break, so we'll take a break.

02               MR. MULLALLY:  All right.

03         (Thereupon, a short recess was taken.) 

04               MR. MULLALLY:  Mr. Chairman, we'll pick up

05  the agenda with Roman numeral five, and General Counsel

06  Mike Bushmann is here to make those presentations.

07               MR. MIKE BUSHMANN:  The first case before you

08  is Isle of Capri-Boonville, DC-05-223.  When slot

09  machines are linked together to offer a progressive

10  jackpot,  a progressive controller is used in order to

11  regulate how that jackpot increases over time.  The

12  controller contains a control computer chip, which

13  Commission rules require have to be verified and sealed

14  with evidence tape to prevent the possibility of

15  tampering. 

16         For four days last September, the casino placed

17  a bank of six slot machines into play without having

18  verified and sealed that control chip for progressive

19  control.  After an investigation, it was found that the

20  chip was operating as it was supposed to and there

21  wasn't any evidence that any tampering had been done.  

22  So since nothing was wrong with the chip itself and the

23  company did self-report, the staff is recommending

24  that the Isle of Capri-Boonville be fined in the amount

25  of $5,000. 

 

 

 

00063

01               CHAIRMAN BARTCH:  Do we have a motion?

02               COMMISSIONER HINRICHS:  I move to approve

03  disciplinary action DC-05-223.

04               COMMISISONER SHULL:  Second.

05               CHAIRMAN BARTCH:  Any further discussion? 

06  If not, please call the roll.

07               MS. FRANKS:  Chairman Bartch?

08               CHAIRMAN BARTCH:  Approved.

09               MS. FRANKS:  Commissioner Hinrichs?

10               COMMISSIONER HINRICHS:  Approved.

11               MS. FRANKS:  Commissioner Biele?

12               COMMISSIONER BIELE:  Approved.

13               MS. FRANKS:  Commissioner Jones?

14               COMMISSIONER JONES:  Approved.

15               MS. FRANKS:  Commissioner Shull?

16               COMMISSIONER SHULL:  Approved.

17               MS. FRANKS:  By your vote, you've adopted

18  Disciplinary Complaint DC-05-223

19               MR. BUSHMANN:  The next case is Harrah's

20  Maryland Heights.  That's DC-05-224.  There are very

21  detailed procedures for how cards and dice have to be

22  stored and handled in casinos and that's in order to

23  prevent cheating.  The Commission auditors examined

24  Harrah's procedures for cards and dice, and found some

25  problems in one pit podium that was being used to store

 

 

 

00064

01  cards and dice.  That pit podium did not have dedicated

02  surveillance coverage.  The log in the podium was

03  supposed to contain an inventory of all the cards and

04  dice in that pit podium, but it did not.   And the log

05  also didn't show that a senior supervisor had verified

06  this.  So for these violations, the staff's

07  recommending a fine of $5,000.

08               CHAIRMAN BARTCH:  Do we have a motion?

09               COMMISSIONER HINRICHS:  Move to approve

10  Disciplinary Complaint 05-224.

11               COMMISSIONER JONES:  Second.

12               CHAIRMAN BARTCH:  Is there any further

13  discussion?  If not, please call the roll.

14               MS. FRANKS:  Chairman Bartch?

15               CHAIRMAN BARTCH:  Approved.

16               MS. FRANKS:  Commissioner Hinrichs?

17               COMMISSIONER HINRICHS:  Approved.

18               MS. FRANKS:  Commissioner Biele?

19               COMMISSIONER BIELE:  Approved.

20               MS. FRANKS:  Commissioner Jones?

21               COMMISSIONER JONES:  Approved.

22               MS. FRANKS:  Commissioner Shull?

23               COMMISSIONER SHULL:  Approved.

24               MS. FRANKS:  By your vote, you've adopted

25  Disciplinary Complaint DC-05-224.

 

 

 

00065

01               MR. BUSHMANN:  The next case is Harrah's

02  Maryland Heights.  That one's CD-05-225.  This one's

03  about cashing personal checks.  The issue of when a

04  casino can cash checks for its customers can be kind of

05  complicated.  The statutes do allow for casinos to cash

06  personal checks, but it also gives the discretion to

07  the Commission to require that a sufficient account

08  balance exists in that customer's account before a

09  casino can take any check.  But in the past, the

10  Commission has not gone this far.  It has tried to

11  balance the interests of allowing the casino to manage

12  its own general business affairs, while on the other

13  hand, trying to protect the casino customers from

14  getting into serious financial difficulty. 

15         So what the Commission did was to impose a rule

16  that casinos are prohibited from cashing a check for a

17  person who had written a check that previously had been

18  returned unsatisfied.  So in other words, you can

19  bounce one check, but you cannot bounce more than that. 

20  In this case, Commission agents conducted an

21  investigation into Harrah's check cashing practices

22  after there was a complaint from a patron.  The

23  investigation found that Harrah's accepted personal

24  checks from five different people who had outstanding

25  checks that had been returned unpaid.  So the staff's

 

 

 

00066

01  recommending that the casino be fined in this case in the

02  amount of $25,000.

03               CHAIRMAN BARTCH:  And the reason for the

04  $25,000 is that because there were five different cases

05  in the past?

06               MR. BUSHMANN:  I don't know that there

07  were -- I don't think that that calculation

08  was used in coming up with that number.  In going back

09  and looking at previous cases, there really wasn't a

10  whole lot that were exactly like this one, but there was

11  a case in 1998 that was a $25,000 fine for Boyd Kansas

12  City for cashing checks for someone on the DAP list. 

13  So it's similar in the sense that it was someone who

14  shouldn't have been able to cash checks, but was

15  allowed to anyway.  

16               CHAIRMAN BARTCH:  I think the reason for

17  the policy is to make sure that people not get into

18  financial trouble gambling.  And so it is, it is a

19  serious violation.

20               MR. BUSHMANN:  Yes.

21               COMMISSIONER HINRICHS:  I move that we

22  approve DC-05-225.

23               COMMISSIONER BIELE:  I second.

24               CHAIRMAN BARTCH:  Any further discussion? 

25  If not, please call the roll.

 

 

 

00067

01               MS. FRANKS:  Chairman Bartch?

02               CHAIRMAN BARTCH:  Approved.

03               MS. FRANKS:  Commissioner Hinrichs?

04               COMMISSIONER HINRICHS:  Approved.

05               MS. FRANKS:  Commissioner Biele?

06               COMMISSIONER BIELE:  Approved.

07               MS. FRANKS:  Commissioner Jones?

08               COMMISSIONER JONES:  Approved.

09               MS. FRANKS:  Commissioner Shull?

10               COMMISSIONER SHULL:  Approved.

11               MS. FRANKS:  By your vote, you've adopted

12  Disciplinary Complaint CD-05-225.

13               MR. BUSHMANN:  The next one is also

14  against Harrah's Maryland Heights, DC-05-226.  Last

15  July, a 19-year-old girl used an altered driver's

16  license to obtain a players card from a casino employee. 

17  And over the next six weeks, that girl entered the

18  casino eight times without being caught.  At least one

19  of those times, she placed a bet.  She was finally

20  caught and arrested when she tried to enter a night

21  club on the casino premises using that same altered

22  driver's license. 

23         Last September, if you'll remember, Harrah's

24  Maryland Heights was fined $15,000 for allowing a minor

25  to enter a casino several times using an altered

 

 

 

00068

01  driver's license and placing bets at a roulette table. 

02  And so for this case, for failing to identify and

03  prevent that minor from entering the casino, the staff

04  is recommending a fine of $30,000.

05               COMMISSIONER HINRICHS:  Essentially,

06  doubling the last one.

07               MR. BUSHMANN:  Yes, ma'am.

08               COMMISSIONER HINRICHS:  I will move to

09  approve DC-05-226.

10               COMMISSIONER BIELE:  Second.

11               CHAIRMAN BARTCH:  Any further discussion?

12               COMMISSIONER HINRICHS:  If they come back

13  again, we make it $60,000.

14               CHAIRMAN BARTCH:  Any further discussion? 

15  If not, please call roll.

16               MS. FRANKS:  Chairman Bartch?

17               CHAIRMAN BARTCH:  Approved.

18               MS. FRANKS:  Commissioner Hinrichs?

19               COMMISSIONER HINRICHS:  Approved.

20               MS. FRANKS:  Commissioner Biele?

21               COMMISSIONER BIELE:  Approved.

22               MS. FRANKS:  Commissioner Jones?

23               COMMISSIONER JONES:  Approved.

24               MS. FRANKS:  Commissioner Shull?

25               COMMISSIONER SHULL:  Approved.

 

 

 

00069

01               MS. FRANKS:  By your vote, you've adopted

02  DC-05-226.

03               COMMISSIONER BIELE:  Before you go on, is

04  there anybody here from Maryland Heights property? 

05               MR. FRED STUCKEL:  Yes, sir.

06               COMMISSIONER BIELE:  Is there any --

07  having three violations this month and all being in

08  different particular areas, is disturbing? 

09               MR. STUCKEL:  Yes, sir.

10               COMMISSIONER BIELE:  It's not just in one

11  particular area.  Is there a reason for the laxity in

12  your casino?

13               MR. STUCKEL:  No, sir.  We don't

14  really have a reason right now.  We will work through

15  this issue.  We have stringent internal controls and

16  training in place.  We just think this is a coincidence

17  of errors that we have right now.  We're working

18  through it, and reminding all of our employees through

19  training and necessary controls and enforcing all of

20  these rules.

21               COMMISSIONER BIELE:  Because like I say,

22  this many, it would be really frowned upon, I think, by

23  this Commission to see this like this again.

24               MR. STUCKEL:  It's very

25  disturbing to us.

 

 

 

00070

01               COMMISSIONER BIELE:  Thank you.

02               MR. BUSHMANN:  The last case I have is

03  Harrah's North Kansas City.  That's DC-05-227.  Back in

04  June of 2004, company employees installed main game

05  program computer chips for 99 slot machines in the

06  casino.  And they configured those machines to accept a

07  maximum wager of three coins or credits.  Two weeks

08  later, the casino was notified by the Commission that

09  those computer chips were only approved if the machine

10  was configured to accept nine coins.  But the company

11  failed to reconfigure the slot machines or remove those

12  chips after that notification in 2004, and that made

13  those 99 slot machines unsuitable for use in Missouri.

14         In September of 2005, the Commission discovered

15  this problem after a patron failed to be paid properly

16  from one of those machines.  This case is the fourth

17  discipline relating to slot machine violations for

18  Harrah's North Kansas City since 2002.  However, that

19  company has made improvements recently in the

20  management of the slot department.  The latest case

21  came before you just last September.  The fines for

22  those previous cases range from $15,000 to $50,000. 

23  And the staff is recommending a fine in this case of

24  $50,000.

25               CHAIRMAN BARTCH:  Do we have a motion?

 

 

 

00071

01               COMMISSIONER HINRICHS:  I move to approve

02  DC-05-227.

03               COMMISSIONER JONES:  Second.

04               CHAIRMAN BARTCH:  Any further discussion?

05               COMMISSIONER JONES:  Yes.  So this is the

06  fifth now?  This is the fifth violation?

07               MR. BUSHMANN:  This would be the fourth.

08               COMMISSIONER JONES:  This would be the

09  fourth?  In how many years?

10               MR. BUSHMANN:  Since 2002.  So it's been

11  over a several year period of time.

12               COMMISSIONER BIELE:  Since this has been

13  going on, has any of our staff from the field been

14  doing any checking on this?  I mean, it seems like

15  since this has been going on over a three-year period,

16  I'm just wondering if we haven't maybe, shouldn't be

17  checking a little closer.   

18               MR. JOHNSON:  Well, we are, as a matter of

19  fact, working really closely.  And as Counsel Bushmann

20  has pointed out, there can be no argument that they

21  have made significant improvements lately in their slot

22  department and we've taken that into consideration.

23               CHAIRMAN BARTCH:  Any further discussion? 

24  If not, please call the roll.

25               MS. FRANKS:  Chairman Bartch?

 

 

 

00072

01               CHAIRMAN BARTCH:  Approved.

02               MS. FRANKS:  Commissioner Hinrichs?

03               COMMISSIONER HINRICHS:  Approved.

04               MS. FRANKS:  Commissioner Biele?

05               COMMISSIONER BIELE:  Approved.

06               MS. FRANKS:  Commissioner Jones?

07               COMMISSIONER JONES:  Approved.

08               MS. FRANKS:  Commissioner Shull?

09               COMMISSIONER SHULL:  Approved.

10               MS. FRANKS:  By your vote, you've adopted

11  DC-05-227.

12               MR. MULLALLY:  Mr. Chairman and

13  Commissioners, the next four items on the agenda

14  involve settlement agreements with regard to cases that

15  have been in dispute and negotiation for some time. 

16  Assistant Attorney General Jane Rackers is here to make

17  those presentations. 

18               MS. RACKERS:  Good morning.

19               CHAIRMAN BARTCH:  Good morning.

20               MS. RACKERS:  The first three of those

21  agenda items deal with the Isle of Capri, and they all

22  deal with failure to report.  So we can take up the

23  first of those cases, which is DC-02-050.  And that

24  case involved a failure to report a patron who was

25  believed to have capped a bet, and that means adding

 

 

 

00073

01  more chips to the bet after the outcome of the game had

02  been determined.  An employee of the casino took that

03  patron into custody to determine information, then

04  released the patron without contacting the Gaming

05  Commission office.  The patron was allowed to leave the

06  casino property before the Gaming Commission agent was

07  contacted. 

08         The original Preliminary Order for Disciplinary

09  Action proposed a penalty of $50,000.  The casino has

10  proposed a settlement for $15,000, in part, because the

11  notification of the Gaming Agent did occur within 35

12  minutes of when the violation was detected, and that

13  the casino employee had obtained information, got the

14  identity of the patron, and was able to provide that

15  information and fill out a report.  So for this matter,

16  the casino's proposed a $15,000 penalty, and we propose

17  that to you.

18               CHAIRMAN BARTCH:  Your proposal is

19  $15,000?

20               MS. RACKERS:  Yes.

21               COMMISSIONER HINRICHS:  I move to approve

22  Resolution Number 05-089.

23               CHAIRMAN BARTCH:  Do we have a second?

24               COMMISSIONER JONES:  Second.

25               CHAIRMAN BARTCH:  Any further discussion? 

 

 

 

00074

01  One does beg the question as to why from 50 down to 15?

02               MS. RACKERS:  Well, I think in part

03  because of consideration of the relatively short amount

04  of time from when the incident occurred to when it was

05  reported.  I believe that we were considering this case

06  in conjunction with all the, the other two cases that

07  we had.  In Columbia, I believe, they were all

08  comprised of $15,000 penalties for failure to report. 

09  I believe, also, that the individual involved in this

10  case, as well as the individuals involved in the other

11  two cases, we've litigated those, and those folks have

12  been disciplined.  And that part of the problem has

13  been resolved.  They are no longer at the casino and so

14  for a combination of reasons --

15               COMMISSIONER BIELE:  I guess the part that

16  bothers me is I realize it's 35 minutes, but that's why

17  we have a Gaming Commission on-site.  The person was

18  released, so the officer, the trooper, didn't even have

19  an opportunity to talk to this person and, hopefully,

20  that's what our people are trained to do better than

21  the casino personnel when it comes to this type of a

22  thing.  I guess that's my beef with it, is that he was

23  released before we even had an opportunity, whether it

24  be five minutes or thirty-five minutes or four hours.

25               MR. CAMPBELL:  Mr. Chairman, I'd

 

 

 

00075

01  be happy to address the issue.  Part of the other

02  consideration that which we conveyed in our settlement

03  offer was that the procedure for the casino at

04  that time is if there was a suspicion of capping, the

05  patron would be brought aside and, basically, escorted

06  off the property.  And that's the suspicion,

07  not a knowledge of capping.  In this case, the policy

08  was followed as it existed at that time.  There was a

09  suspicion that there had been a violation.  The patron

10  was taken.  Adequate information for a follow-up

11  investigation was obtained and the patron was then

12  escorted away immediately and the Commission staff

13  was notified.  That has now been acknowledged as

14  backwards.  The -- right now, even with a suspicion of

15  theft, the Commission staff will be notified

16  immediately.

17               CHAIRMAN BARTCH:  Thank you.  Any further

18  discussion?  If not, please call the roll.

19               MS. FRANKS:  Chairman Bartch?

20               CHAIRMAN BARTCH:  Approved.

21               MS. FRANKS:  Commissioner Hinrichs?

22               COMMISSIONER HINRICHS:  Approved.

23               MS. FRANKS:  Commissioner Biele?

24               COMMISSIONER BIELE:  Approved.

25               MS. FRANKS:  Commissioner Jones?

 

 

 

00076

01               COMMISSIONER JONES:  Approved.

02               MS. FRANKS:  Commissioner Shull?

03               COMMISSIONER SHULL:  Approved.

04               MS. FRANKS:  By your vote, you've adopted

05  Resolution Number 05-089.

06               MS. RACKERS:  The case found at tab 2 also

07  involved the Isle of Capri.  In this case, it involved

08  two incidents of failure to notify.  In one instance,

09  there was an altercation alleged between two patrons,

10  where one patron alleged that he pulled a knife and

11  attempted to injure another patron.  The patron who was

12  accosted contacted the casino and suggested that the

13  Commission be notified, but the casino employee did not

14  immediately notify the Commission.  

15         In the second incident, there was a patron who

16  attempted to enter the casino illegally by using

17  someone else's driver's license.  Again, he had -- we

18  had two of the same people involved in all of these

19  incidents.  In that incident, the supervisor of the

20  casino, the security supervisor, was contacted and

21  looked at the identification, did not allow the patron to

22  enter the casino, but gave the false I.D. back to the

23  patron and sent him on his way, and he did not

24  immediately notify the Commission.  So in that case,

25  the proposed penalty was $60,000 and the proposed

 

 

 

00077

01  settlement for that is $50,000.

02               COMMISSIONER HINRICHS:  For what reason

03  was it reduced by $10,000?

04               MS. RACKERS:  Well, on that one, I believe

05  that the consideration was the notification, though not

06  immediately, was within a fairly short amount of time,

07  less than an hour.  But I think that was the main

08  consideration.  But again, those employees have been

09  disciplined by the Commission and are no longer

10  employed by the casino. 

11               COMMISSIONER HINRICHS:  I move that we

12  approve Resolution Number 05-090.

13               COMMISSIONER BIELE:  Second.

14               CHAIRMAN BARTCH:  Any further discussion? 

15  If not, please call the roll.

16               MS. FRANKS:  Chairman Bartch?

17               CHAIRMAN BARTCH:  Approved.

18               MS. FRANKS:  Commissioner Hinrichs?

19               COMMISSIONER HINRICHS:  Approved.

20               MS. FRANKS:  Commissioner Biele?

21               COMMISSIONER BIELE:  Approved.

22               MS. FRANKS:  Commissioner Jones?

23               COMMISSIONER JONES:  Approved.

24               MS. FRANKS:  Commissioner Shull?

25               COMMISSIONER SHULL:  Approved.

 

 

 

00078

01               MS. FRANKS:  By your vote, you've adopted

02  Resolution Number 05-090.

03               MS. RACKERS:  In the last of the Isle of

04  Capri cases, in tab R, again, a failure to report a

05  case where a female patron reported to the casino that

06  her purse was missing.  Casino employees began an

07  investigation, looked at videotape, believed that they

08  had the suspect who had stolen the purse, and a casino

09  employee then gave the name, address, and phone number

10  of that suspect to the patron, but did not immediately

11  notify the agent and did not report the theft of the

12  purse to the agent immediately.  They were notified

13  shortly thereafter, but did not report it.  Given that

14  it is another failure to report, the initial

15  recommendation for proposed penalties were $120,000, and

16  offer to resolve the case is for $100,000.

17               COMMISSIONER HINRICHS:  I move to approve

18  Resolution Number 05-091. 

19               COMMISSIONER JONES:  Second.

20               CHAIRMAN BARTCH:  Any further discussion? 

21  If not, please call the roll.

22               MS. FRANKS:  Chairman Bartch?

23               CHAIRMAN BARTCH:  Approved.

24               MS. FRANKS:  Commissioner Hinrichs?

25               COMMISSIONER HINRICHS:  Approved.

 

 

 

00079

01               MS. FRANKS:  Commissioner Biele?

02               COMMISSIONER BIELE:  Approved.

03               MS. FRANKS:  Commissioner Jones?

04               COMMISSIONER JONES:  Approved.

05               MS. FRANKS:  Commissioner Shull?

06               COMMISSIONER SHULL:  Approved.

07               MS. FRANKS:  By your vote, you've adopted

08  Resolution Number 05-091.

09               CHAIRMAN BARTCH:  What begs to said here,

10  though, is that the Commission agent has to be

11  notified.  Would you address that?

12               MR. CAMPBELL:  Yes, Mr. Chairman. 

13  I wanted to draw your attention to the fact that these

14  are very old cases, and are very old for a host of

15  reasons.  In fact, the 2002 case, the first case you

16  heard, was in the year 2000.  So these are old.  To my

17  knowledge, I don't believe there has been a failure to

18  report discipline since these three disciplinary

19  matters.  And that is probably the best evidence, that

20  we got the message.

21               COMMISSIONER BIELE:  I also understand now

22  why Isle of Capri left and you stayed here by yourself.

23               MR. CAMPBELL:  Could someone

24  please remove the arrows out of my back?  Thank you.

25               MS. RACKERS:  And then the fourth matter,

 

 

 

00080

01  at tab S, involves the Ameristar Casino St. Charles. 

02  This is a matter involving Ameristar's SuperLink

03  program.  It was a slot machine progressive bonus

04  system called the SuperLink.  And the SuperLink system

05  was connected to approximately 800 of Ameristar's 3,200

06  slot machines, and the system was placed into service

07  at Ameristar in August of 2002.  The SuperLink

08  progressive jackpot system is separate from the

09  computer system that runs the regular jackpots on the

10  slot machines. 

11         In March of 2004, Ameristar detected a problem

12  with that SuperLink system, in that an implementation

13  of the progressive slot machine had errors in the

14  system.  The communication problems in the SuperLink

15  system apparently began in 2002 and went undetected

16  until March of 2004, when discovered by Ameristar. 

17  Approximately 200 of the slot machines that had the

18  SuperLink system experienced some of the communication

19  problems. 

20         It is important, I think, to note that as the

21  patrons were playing on those machines, when they saw a

22  jackpot on the meter on the machine, if they won the

23  jackpot, they won the amount that was on the meter. 

24  The problem was that the system was not correctly

25  computing what the jackpot should be.  So while they

 

 

 

00081

01  received what they thought they would receive, they didn't

02  receive what they should have.  That under-

03  implementation in the SuperLink system resulted in a

04  total amount of $152,801.20 that was not put on the

05  jackpots over that period from 2002 to 2004. 

06         Now, as a result, Ameristar -- part of the

07  problem here, too, is that they did not have a

08  secondary audit process in place that would have

09  detected the problems in communication in the system. 

10  When Ameristar detected the problem, they immediately

11  reported it to the Gaming Commission staff and

12  cooperated fully with the investigation provided in

13  connection with the gaming process.  And as a result,

14  the Ameristar, with the agreement of the Gaming

15  Commission staff, put $152,801.20 back into the

16  progressive jackpots on the machines at the Ameristar. 

17  That's what they did with the money that wasn't paid

18  out to the patrons. 

19         And so based upon all the factors, Ameristar has

20  proposed a penalty of $115,000.  The Commission, when

21  it considered this case, proposed a penalty of

22  $200,000.  So this is a considerable difference in the

23  penalty proposed by the Commission.  I suspect staff

24  might want to describe their thoughts, but I believe the

25  initial concern was that since this was a computer

 

 

 

00082

01  problem, the SuperLink system, would create a great

02  deal of distrust among the gaming public, and it was

03  anticipated that there would be a substantial backlash

04  in the public, and that hasn't happened.  It has not

05  been a result.  And so, therefore, we propose for

06  consideration for resolution in this case for $115,000.

07               COMMISSIONER BIELE:  This back-up system,

08  isn't it true that they, if I can remember right, that

09  they have a back-up system in Kansas City, but they did

10  not have a back-up system in St. Louis?

11               MR. GREG SILVER:  That is correct.

12               COMMISSIONER BIELE:  Any particular reason

13  why they did not have the back-up system?

14               MR. SILVER:  I don't really know

15  the reason.  I think that Kansas City may have detected

16  something that they had an issue a little bit and they

17  did put a procedure in place that did not get put in

18  place in St. Charles. 

19               COMMISSIONER BIELE:  Is it in place now?

20               MR. SILVER:  Yes, it is.

21               COMMISSIONER BIELE:  Okay.

22               COMMISSIONER HINRICHS:  I move that we

23  approve Resolution Number 05-092.

24               COMMISSIONER BIELE:  Second.

25               CHAIRMAN BARTCH:  Any further discussion? 

 

 

 

00083

01  If not, please call the roll.

02               MS. FRANKS:  Chairman Bartch?

03               CHAIRMAN BARTCH:  Approved.

04               MS. FRANKS:  Commissioner Hinrichs?

05               COMMISSIONER HINRICHS:  Approved.

06               MS. FRANKS:  Commissioner Biele?

07               COMMISSIONER BIELE:  Approved.

08               MS. FRANKS:  Commissioner Jones?

09               COMMISSIONER JONES:  Approved.

10               MS. FRANKS:  Commissioner Shull?

11               COMMISSIONER SHULL:  Approved.

12               MS. FRANKS:  By your vote, you've adopted

13  Resolution Number 05-092.

14               MS. RACKERS:  Thank you.

15               CHAIRMAN BARTCH:  Thank you.

16               MR. MULLALLY:  Mr. Chairman,

17  Commissioners, the next items on the agenda involve the

18  consideration of a re-licensure of certain suppliers

19  and Chief Deputy Director Steve Johnson will make those

20  presentations. 

21               MR. JOHNSON:  Mr. Chairman, members of the

22  Commission, our investigators have conducted

23  investigations into the suitability of two of our

24  currently licensed suppliers, Atlantic City Coin and

25  Slot Service Company, and Western Money Systems.  And

 

 

 

00084

01  this consideration is, of course, for re-licensing. 

02  The investigation into the Atlantic City Coin and Slot

03  Service Company was conducted by Sergeants Gary Baker

04  and Jeff Smith, and with the assistance of financial

05  investigator Don Krieg. 

06         Our investigation included, but was not limited

07  to, inquiries related to the following considerations: 

08  Cash flow and operations, the reports of independent

09  accountants, key persons in operations and other

10  jurisdictions. 

11         For your edification, the products that are

12  produced by these two suppliers, AC Coin is the

13  exclusive sales agent for IGT in Atlantic City, New

14  Jersey, the Caribbean, and on Florida cruise ships, but

15  they have proprietorship over seven slot machines

16  currently manufactured by IGT and two table games. 

17  They also manufacture custom slot machines and produce

18  custom signage for this industry. 

19         Western Money Systems produces machines that

20  redeem coupons and vouchers generated by the slot

21  machines, as well as devices that break bills for

22  patrons.  They also manufacture self-service kiosks

23  that redeem tickets, also break bills and they perform

24  custom marketing functions for the industry. 

25         In both cases, AC Coin and Western Money

 

 

 

00085

01  Systems, our investigative findings do include a

02  financial review, disclose no discrepancies or concerns

03  that would preclude licensing the applicants, as

04  required within the state of Missouri. 

05               COMMISSIONER HINRICHS:  Can we do these

06  together?

07               MR. MULLALLY:  If it's unanimous.

08               COMMISSIONER HINRICHS:  I will move that we

09  approve Resolutions Number 05-093 and 05-094.

10               COMMISSIONER SHULL:  Second.

11               CHAIRMAN BARTCH:  Any further discussion? 

12  If not, then please call the roll.

13               MS. FRANKS:  Chairman Bartch?

14               CHAIRMAN BARTCH:  Approved.

15               MS. FRANKS:  Commissioner Hinrichs?

16               COMMISSIONER HINRICHS:  Approved.

17               MS. FRANKS:  Commissioner Biele?

18               COMMISSIONER BIELE:  Approved.

19               MS. FRANKS:  Commissioner Jones?

20               COMMISSIONER JONES:  Approved.

21               MS. FRANKS:  Commissioner Shull?

22               COMMISSIONER SHULL:  Approved.

23               MS. FRANKS:  By your vote, you've adopted

24  Resolution Number 05-093 and 05-094.

25               MR. JOHNSON:  The next item that we have

 

 

 

00086

01  under tabs V and W in the information in front of you

02  involves some facts that our investigators conducted

03  investigations into the suitability of the following

04  named companies as either bingo manufacturers or

05  suppliers as noted under the tabs I mentioned.  The

06  investigators involved in these investigations include

07  Sergeants Franklin, Booker, Kramer and Wilkinson, the

08  Charitable Games Unit. 

09         Our investigation included, but was not limited

10  to, the following considerations: Tax checks,

11  registration for the Secretary of State, out of state

12  gaming license checks, criminal and civil records

13  checks, key persons, federal, state, county, and

14  municipal law enforcement agencies, financial

15  consideration to include credit and tax information.

16         And our investigation has resulted in the

17  discovery of no information that would preclude the

18  licensure of the following companies:  Suppliers: Games

19  Galore, a Missouri corporation or company; All American

20  Bingo, a Missouri company; Bingo Supply Center, a

21  Missouri company; Game Tech International from Nevada,

22  California Concept, which is an Ohio based company. 

23  The manufacturers include: Universal Manufacturing, a

24  Missouri company; Douglas Press, an Illinois company;

25  International GameCo Incorporated, from Nebraska; Aero

 

 

 

00087

01  International and Game Tech International, from Nevada;

02  Western Game Boat Supplies, from Ontario; and Applied

03  Concepts, that was based in Ohio; Pollard Games, from

04  Iowa; and finally, Fortunet Incorporated, which is a

05  Nevada company. 

06         If we have any, if you have any quick questions

07  that we could answer, our investigators would be happy

08  to take them.

09               COMMISSIONER HINRICHS:  I will move that

10  we approve Resolutions 05-010B and 05-011B.

11               COMMISSIONER SHULL:  Second.

12               CHAIRMAN BARTCH:  Any further discussion? 

13  If not, please call the roll.

14               MS. FRANKS:  Chairman Bartch?

15               CHAIRMAN BARTCH:  Approved.

16               MS. FRANKS:  Commissioner Hinrichs?

17               COMMISSIONER HINRICHS:  Approved.

18               MS. FRANKS:  Commissioner Biele?

19               COMMISSIONER BIELE:  Approved.

20               MS. FRANKS:  Commissioner Jones?

21               COMMISSIONER JONES:  Approved.

22               MS. FRANKS:  Commissioner Shull?

23               COMMISSIONER SHULL:  Approved.

24               MS. FRANKS:  By your vote, you've adopted

25  Resolution Numbers 05-010B and 05-011B.

 

 

 

00088

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

02  on the agenda involves the consideration of a

03  resolution delegating authority to the Chairman.  As

04  you may recall, last year, we, the Commission, adopted

05  a new policy that allowed for certain active chairmen

06  to continue certain matters so that we wouldn't have to

07  have telephonic Commission meetings for relatively

08  innocuous things.  And you could be able to push those

09  off until the Commission could get together. 

10         It's worked exceedingly well.  Those telephonic

11  meetings were always excruciating for the staff.  I

12  imagine it wasn't much better for the Commission.  And

13  so -- but the one provision was that it be reviewed

14  annually.

15               CHAIRMAN BARTCH:  And in the provision, it

16  -- it needs to be reported to the

17  Commission.

18               MR. MULLALLY:  Yes.

19               CHAIRMAN BARTCH:  You know, when it does

20  occur.  It's worked well.  It's helped on the

21  telephonic meetings.  I recommend that we renew it,

22  that that was certainly a consideration of the

23  Commission.

24               COMMISSIONER BIELE:  I second it.

25               COMMISSIONER HINRICHS:  You can't make --

 

 

 

00089

01               CHAIRMAN BARTCH:  Well, I can, but I

02  won't.

03               COMMISSIONER HINRICHS:  Then I'll second. 

04  He makes the motion.

05               CHAIRMAN BARTCH:  Okay.  Is there a motion

06  and a second here?  Any further discussion?  Please

07  call the roll.

08               MS. FRANKS:  Chairman Bartch?

09               CHAIRMAN BARTCH:  Approved.

10               MS. FRANKS:  Commissioner Hinrichs?

11               COMMISSIONER HINRICHS:  Approved.

12               MS. FRANKS:  Commissioner Biele?

13               COMMISSIONER BIELE:  Approved.

14               MS. FRANKS:  Commissioner Jones?

15               COMMISSIONER JONES:  Approved.

16               MS. FRANKS:  Commissioner Shull?

17               COMMISSIONER SHULL:  Approved.

18               MS. FRANKS:  By your vote, you've adopted

19  Resolution Number 05-095.

20               MR. MULLALLY:  Mr. Chairman, as you may

21  recall, when the Commission designated that Pinnacle

22  Entertainment was a priority for investigation for its

23  two projects in downtown St. Louis and St. Louis

24  County, there were a couple of conditions that were

25  placed on that priority designation.  One of which is

 

 

 

00090

01  that they meet certain financial conditions.  The staff

02  has reviewed financial statements submitted by the

03  applicant, and Martha LeMond is here to make that

04  presentation. 

05         Martha, I believe you may have been introduced

06  to her at the last Commission meeting, but she's been

07  here about a month or so and is very, very talented and

08  has a wealth of experience in both the public and

09  private sector, and a variety of different capacities. 

10  She's very bright and we feel very lucky to have her. 

11  So with those lowered expectations, I'll ask her to

12  make her presentation.

13               MS. MARTHA LEMOND:  Yes, I was thinking about

14  going home before I created a problem. 

15         First of all, good morning.  I'm really happy to

16  be here.  Pinnacle is an interesting situation.  Their

17  net revenues continue to increase despite some of

18  the difficulties they have experienced with the

19  hurricanes down south and their expansion and

20  improvement numbers of highly diversified portfolios.  

21         Before we get to the real heart, I want to

22  indicate that my documentation is based on SEC 10Q and 10K

23  filings, both audited and unaudited for the most recent

24  period.  It's hard numbers from actual performance, no

25  pro forma, no looking forward.  It's what they've done

 

 

 

00091

01  for this quarter.  We have an ongoing resolution that

02  they meet a two-times minimum ratio.  That's in

03  consideration of how much they're earning to cover

04  their debt.  The good news is it is 2.0.  They say it's

05  2.1.  That's just another example of you probably have

06  a slight difference due to the economy.  It has trended

07  down some over the last four trailing quarters, but I

08  don't think that that's a difficulty at this point in

09  time. 

10         I'd also like to put the caveat in there that we

11  took no consideration with their anticipated insurance

12  proceeds that they're saying that they'll receive,

13  whether substantial or not, of $1,100.  And that's

14  basically, the gist of all the reading and all the

15  documentation.  I'm ready now to answer questions.

16               CHAIRMAN BARTCH:  Questions?

17               MS. LEMOND:  Thank you very much.

18               MR. MULLALLY:  Thank you.  Martha's done a

19  tremendous amount of work.  I know it's a relatively

20  short presentation.  We've had a number of informal

21  staff discussions about it.  She's put dozens and

22  dozens of hours of work into coming to that conclusion,

23  so I appreciate that. 

24         Mr. Chairman and Commissioners, next on the

25  agenda is Commissioner Jones and, I think, joined by

 

 

 

00092

01  the rest of the Commission, had asked for updates

02  periodically from Pinnacle Entertainment with regard to

03  the MBE and WBE compliance.  They are submitting that

04  information to us on a monthly basis, but we thought

05  that for this first reporting period, it would be

06  helpful to have them come and make a presentation in

07  person and they are.  Wade Hundley is here and they are

08  prepared to do just that.

09               MR. WADE HUNDLEY:  Good morning, Mr. Chairman. 

10  Good morning, Commission, staff.  I appreciate the

11  opportunity to be here to give an update on our

12  minority compliance issues with respect to both our

13  city project and our county projects.  With me here

14  today is Cliff Kortman.  Cliff is our Senior Vice

15  President of Development and Construction.  After I

16  give an update on minority issues, we will quickly give

17  an update on the status of the projects. 

18         I think we're off to a very good start with

19  respect to our minority and women-owned, business-owned

20  compliance issues.  We're just at the beginning of

21  these projects, and so we certainly realize these are

22  issues that require daily focus.  We’ve got some pretty

23  lofty goals that we have to hit, and the only way we're

24  going to do that is if we have daily focus throughout

25  all of us, our organization.  And I can, I can assure

 

 

 

00093

01  that we have that focus right now, from Dan Lee's level

02  all the way down through our organization.  And I think

03  we've made some, some good progress to get an

04  organization in place that will help us with those

05  goals. 

06         To date, we are just days away from finalizing

07  our compliance plan with the City of St. Louis.  This

08  plan will meet the guidelines of the Mayor's Executive

09  Order 28, which requires 25 percent MBE participation

10  and 5 percent WBE.  We've hired consultants at this

11  point to assist us in our MBE, WBE compliance.  Those

12  consultants are MHR International and ADE Consulting

13  Services.  They have teamed up to help us with these

14  issues. 

15         I have Don Robertson, who is in the audience

16  today, from MHR International.  They are a company

17  that's based out of Atlanta, but they've had operations

18  and an office in St. Louis for quite some time.  And

19  then ADE is headquartered in St. Louis.  So we think

20  those two firms will certainly have the best knowledge

21  and experience and can help us identify minority

22  business that we can work with and will be involved in

23  our daily operations as we start to meet these

24  goals. 

25         We are also searching, currently, for an

 

 

 

00094

01  internal compliance person, which will work daily with

02  the consultants and will further strengthen our

03  organization. 

04         We, to date, we, as you know, have begun

05  construction downtown and we are in the process -- as

06  part of that process, we are meeting on a weekly basis,

07  sometimes twice weekly, with the city general

08  contractor and Pinnacle representatives to both look at

09  the bids that are about to go out, to review contracts

10  or proposals that have come in from contractors, as

11  well as to review ways, creative ways, that we can

12  approach these bids to make it easier for minority and

13  WBE, MBE and WBE participation.  Sometimes requirements

14  that are out there in the typical fields makes it

15  difficult for some of the smaller businesses to meet

16  those requirements, and we're trying to come up with

17  creative ways that allows to ease up those

18  contracts, creating more participation. 

19         I think we've been pretty successful to date. 

20  In terms of our cumulative work in process, work that's

21  been completed, we are at 32 percent MBE participation. 

22  That number is a little bit inflated because McCarthy,

23  who is our general contractor, will perform some work

24  where the contract's already out, and so they're not a

25  minority-owned firm, and so that percentage will come

 

 

 

00095

01  down.  Those percentages will go up and down as

02  we do different parts of the project.  Different parts

03  of the project are easier to get as MBE, WBE firms out

04  there that are available, and so our percentages will

05  go -- you'll see them go up and down on a weekly and

06  monthly basis as we make these reports.  But at the end

07  of the day, our targets are 25 percent, 5 percent for

08  the city project. 

09         In the county, we have, we've finalized our

10  compliance plan with the county.  That plan requires 19

11  percent MBE, WBE participation.  We're just at the

12  start of that project.  Right now, we are doing our

13  environment testing.  One of our environmental firms is

14  actually submitting its plan.  I don't have the

15  estimated --

16               MR. CLIFF KORTMAN:  Yes.  They've submitted the

17  work plan and it's been approved by the MBE office.

18               MR. HUNDLEY:  So the plan's been submitted

19  there and their contract requires 25 percent MBE, WBE

20  participation for actual performance of work.  So

21  that's just in the process of getting started, so we

22  don't have a lot to report.  That's why our change of

23  monies have actually been extended in the county. 

24         We have submitted this report.  I'm open to any

25  kind of comments or -- it is the first one and so, in

 

 

 

00096

01  terms of format or content, do you want more or less

02  information.  We'd be happy to include anything you

03  want in future reports, but we -- this was the first

04  one and if you like this format, we can continue this

05  or we can adjust it in any way in the future.  So

06  that's kind of the report. 

07         Just at the onset year, the heavy focus on our

08  company.  You know, this is a big issue that we have to

09  really set the standard here.  We know that we're very

10  highly visible and I think we are very committed and I

11  want to be an example for all the casinos in the state

12  for their projects. 

13               COMMISSIONER JONES:  A couple questions. 

14  You said that you have that report.  Is it detailed or

15  just pretty much --

16               MR. HUNDLEY:  Well, it's detailed and then

17  there's an exhibit here that shows the work and the

18  amounts of the work as a spreadsheet and it lists

19  the firms that have performed the work and the amounts

20  of those, of the work that's been completed and done,

21  and with how much, you know, what percentages MBE, WBE. 

22               MR. JONES:  Okay.  That's pretty much -- I

23  was asking the question, you said there was 32,

24  currently 32 percent participation with the --

25               MR. HUNDLEY:  Work in place.

 

 

 

00097

01               MR. JONES:   -- work in place.

02               MR. HUNDLEY:  Right.

03               MR. JONES:  But you didn't give the, you

04  know, I guess on that report, it'll have the --

05               MR. HUNDLEY:  Yeah.  There's the cumulative

06  work in place dollars, about 2, almost 2.5 million

07  dollars and $800,000 of that, a little over that is

08  going to the minority plan. 

09               COMMISSIONER JONES:  Okay. And it lists

10  minority contractors?

11               MR. HUNDLEY:  Yes, it does.  There's six

12  minority firms, so far involved.

13               COMMISSIONER HINRICHS:  Any of them

14  female?

15               MR. HUNDLEY:  Female?  We don't have them

16  broken down between WBE and MBE.  There has been WBE

17  work.  Yes, there has.

18               MR. KORTMAN:  I don't have that percentage

19  exactly at this point, but we will define that.  You

20  know, this report is really a first blush effort.  We

21  know that you have a requirement.  We submitted it to

22  staff and we are very open to format in any way you'd

23  like us --

24               COMMISSIONER HINRICHS:  Could we get a --

25  instead of getting a monthly report that's just what

 

 

 

00098

01  the picture is now, have the continuous picture so that

02  we can see it as --

03               MR. KORTMAN:  Yes.  That is really the way

04  this is formatted, so you can just add to it and you

05  can see from, you know, by time.

06               MR. HUNDLEY:   Totals for the month and

07  then the right, the right-hand side of the spreadsheet

08  is cumulative. 

09               COMMISSIONER JONES:  Do you give the

10  dates?

11               MR. HUNDLEY:  Absolutely.

12               COMMISSIONER HINRICHS:  Do you think,

13  ultimately, it could be done on a chart form so that we

14  could see how it has improved?

15               MR. HUNDLEY:  Sure.  Absolutely. 

16  Absolutely.  Yes.  We'll get much better at the

17  presentation of this, but this was just roughly.

18               COMMISSIONER JONES:  Okay.  Now, the firm

19  from the city that is listed, is that A --

20               MR. HUNDLEY:  Yes.  MHR, which is from

21  Atlanta, and ADE Consulting Services --

22               COMMISSIONER JONES:  ADE?

23               MR. HUNDLEY:  ADE, yes.  I'm sorry.  I get

24  my letters mixed up. 

25               COMMISSIONER JONES:  And MHR, they have an

 

 

 

00099

01  office in St. Louis?

02               MR. HUNDLEY:  Yes.

03               COMMISSIONER JONES:  Okay.

04               COMMISSIONER HINRICHS:  I'm sure the City

05  of St. Louis is concerned about St. Louis firms being

06  represented.

07               MR. HUNDLEY:  Absolutely.

08               COMMISSIONER HINRICHS:  And I presume that

09  you were, you were being very conscious of --

10               MR. HUNDLEY:  Absolutely.  That's our first

11  --

12               COMMISSIONER HINRICHS:  -- To keep as many

13  in St. Louis.

14               MR. HUNDLEY:  -- keep them in Missouri,

15  keep them in St. Louis.

16               MR. KORTMAN:  Yes.  I think to date,

17  actually looking down the list of the work, I don't

18  think there's any out-of-state contractors on the list

19  so far. 

20         One of the other things I might just add to what

21  Wade said, historically, what will happen on projects

22  like these is you'll go through a process where you get

23  all the way to the end of the drawing, the CD's are

24  complete, and we go to a contractor and we enter into a

25  contract with them.  They buy the job and it's

 

 

 

00100

01  difficult, but they buy to get the kind of

02  participation you need for smaller firms. 

03         So what we've elected to do is really do this

04  as, do the project as a package-based project.  So

05  we're releasing packages.  We're doing it by packages. 

06  So we're doing the excavation and site work as one of

07  our big packages.  And then we really focus on how we

08  did get maximum participation on that package.  The

09  next package is putting in the foundation.  We really

10  focus on that package and how we can get multiple

11  vendors, qualified vendors, to work on our project. 

12  And that way, it's not just the top guys that get the

13  work.  We're trying to get more participation with

14  companies that are not as big as some of the bigger

15  investors.

16               MR. MULLALLY:  Mr. Chairman, if I could

17  add something.  You know, one of the focuses of the

18  staff as we monitor this is to make sure -- you know,

19  we want to emphasize that we want these things to stay

20  in Missouri and in St. Louis, people.  Our businesses

21  have still got to be competitive and we want to make

22  sure this doesn't become an environment for influence

23  peddling.  We've watched it in other states.  We saw it

24  happen when Governor Edwards was the head of Louisiana,

25  or you know, there's some indication that it may be

 

 

 

00101

01  going on in Pennsylvania now, another state that has a

02  long political history.  We don't want it to become an

03  environment for influence peddling. 

04         So the people, the business, we want them to be

05  Missourians, we want a lot of minority and women on

06  business participation, but they've got to be

07  competitive.  This isn't going to be Let's Make a Deal. 

08  And so that's one of the things that's really a focus

09  for the staff as we watch this stuff.  I think it's

10  very important to say that in a public setting.

11               COMMISSIONER JONES:  Oh, absolutely.

12               MR. KORTMAN:  Our excavation package, as

13  you know, we broke ground a couple months ago and we

14  really are about a month ahead on our excavation piece

15  here.  We are now between 90 and 95 percent done with

16  the excavation piece.  We have about 150,000 yards of

17  material that needed to come out of the city project. 

18  That material has actually been put onto the county

19  project.  It's sort of two-fold win-win situation.  We

20  needed fill for county project, so we've utilized the

21  material from the city project for the county project. 

22  As you know, the county project is a little low and we

23  want, we want to use that material, which is good

24  material, for that project.  So it was a win-win

25  situation.  So we are about 90 percent done now with

 

 

 

00102

01  that excavation work. 

02         The shortening and lightening work for the

03  basin, the tension work that will pull the rest of the

04  dirt back and support the roads around the project,

05  that work now is about 65 percent done.  The long legs

06  of that retention system are basically complete now. 

07  We're working on the short legs.  All of that's going

08  very well.  Again, as I mentioned to you, the bid

09  packages are out now, and we just actually received

10  bids for the footing and foundation package.  We're

11  going to be awarding that this coming week, and then

12  we'll have our contractors on board to start the

13  footing and foundation work. 

14         In terms of our design packages, we're complete

15  now with the frame design, which is the high-rise

16  component of the structure, the concrete frame.  All of

17  that design now is complete.  And then each of our

18  packages, we'll just sort of update you when we report

19  on a monthly basis and sort of tell you what we're

20  doing and how the packages are going out.  So that's an

21  update on the city. 

22         As you know, we broke ground in the county.  We

23  submitted our work plans to MDNR for the remediation

24  package and that has been accepted by the MDNR and we

25  are now working on our alleviation plan.  We are

 

 

 

00103

01  engaging a soils company, a company that does our sub-

02  soil investigation.  In the past, we have used TSI for

03  a lot of our work.  They were working on the city

04  project, and they will be working on the county

05  project, as well.  And they are a minority firm. 

06         We're in the early phases of the county project,

07  but it's, we're starting to get the ball rolling on

08  that project, and we're excited about the plans.  They

09  really, I think, they updated you a couple months ago

10  and one of these days, we hope to make a presentation

11  to show where we are.  Do you have questions for us?

12               COMMISSIONER HINRICHS:  Take lots of

13  pictures of that.

14               MR. KORTMAN:  You bet.  We have a website,

15  actually, where you can see. 

16               MR. HUNDLEY:  Did we mention the web

17  camera?

18               MR. KORTMAN:  Okay.  We do have web cam so

19  you can see the city project, the activity that goes on

20  every day.  So you can actually get on our website and

21  then take a look and see what's happening with our

22  project.

23               COMMISSIONER JONES:  I guess at one time,

24  you had a lot of irate Rams fans because you took away

25  their tailgate, but since we aren't winning, I guess

 

 

 

00104

01  it's okay now. 

02               MR. HUNDLEY:  That's not what we wanted.

03               COMMISSIONER JONES:  Right.  You're good

04  to go now, I guess.

05               COMMISSIONER HINRICHS:  When you open up,

06  they'll start in again.  And they'll use your parking

07  garage.

08               MR. HUNDLEY:  We kind of expect that.

09               CHAIRMAN BARTCH:  Any questions?

10               MR. HUNDLEY:  Thank you very much.

11               MR. KORTMAN:  Thank you.

12               CHAIRMAN BARTCH:  Kevin, did you have

13  someone else?

14               MR. MULLALLY:  Yes.  Mr. Chairman,

15  although it's our preference that folks contact us so

16  that we can manage our time -- we don't want to exclude

17  anybody but we would just like to be able to manage our

18  time.  Mark Andrews had asked me during the meeting if

19  he could have a few minutes to talk with the

20  Commission.  Mark is the President of Casino Watch.  He

21  is always a very gracious person to deal with and we

22  enjoy working with him and you said that you had no

23  objection, so --

24               CHAIRMAN BARTCH:  If you would?

25               MR. MARK ANDREWS:  I will definitely keep it

 

 

 

00105

01  brief.

02               CHAIRMAN BARTCH:  Thank you.

03               MR. ANDREWS:  And I thank you for letting

04  me speak with you for just a moment.  I was at a

05  meeting of the Missouri Joint Committee on Gaming and

06  Wagering last week and talked to them.  They are deeply

07  considering action about gaming in the next

08  session that's coming up.  And so I spoke to them a

09  little bit about a trend which I'm concerned about.  At

10  Casino Watch, we have been monitoring and watching what

11  your annual reports say every year and we've done an

12  eight-year recap of various items in the annual report.

13         One of the ones that we've seen is that table

14  games, the more entertaining part of gaming, has sort

15  of leveled out and, in some cases, even gone down.  And

16  what had risen to tremendous heights is gambling with

17  slot machines. 

18         Slot machines are the most addictive type of

19  gambling available, and I've included a package here,

20  which I would leave here for your consideration at a

21  later time, a report from an Eastern university is now

22  on their second study on the addictiveness of slot

23  machines and they have concluded that slot machines are

24  three more times more addictive -- a person can be

25  addicted to gambling three times faster -- than the

 

 

 

00106

01  other traditional methods of gambling. 

02         And I think Missouri has had a philosophy from

03  the very beginning of wanting to offer entertainment. 

04  It certainly had a philosophy of regulation, which I

05  must say you've done very well.  Missouri is looked

06  upon as the regulator of gaming across the country. 

07  But it seems from the facts now, that Missouri grows

08  the most addictive kind of gambling and it curtails and

09  cuts back the more entertaining type of gambling.  And

10  that has to do also with employment.  If you look at

11  the charts in the last eight years, employment has come

12  down, and so the state will ask -- so we don't offer

13  quite the employment that we thought might come years

14  ago. 

15         I asked the Gaming Commission several months ago

16  -- in fact it might have been a year ago, if the pain

17  of addiction rises to a level that is very, very

18  difficult to deal with, will the Commission do

19  something about it?  And I think I got a very truthful

20  answer.  The answer was no.  We operate at the

21  direction of the General Assembly.  The General

22  Assembly says, "We will license gambling.  We will

23  regulate it, but we want it to be competitive with

24  other states." 

25         I guess what I would ask, or I would like you to

 

 

 

00107

01  think about, is would you look at the addictiveness of

02  slot machines, and would you make a recommendation to

03  the General Assembly that they study it?  I think in my

04  greatest world of requests, if I could get the State of

05  Missouri to say, you know, "We don't want to addict

06  people any more than is, that has to happen.  We do not

07  want to cause harm." 

08         Let's put a cap on slot machines now.  We have

09  17,875 slot machines in Missouri.  Our neighbor to the

10  east has 9,600.  So we're almost double and we're

11  getting ready to open two new, major casinos here in

12  the St. Louis area, and we'll add on 5,000 more slot

13  machines.  That will give us nearly 23,000 slot

14  machines that our university studies show they are the

15  most addictive form of gambling around.  And I just

16  don't think that is Missouri's philosophy that we

17  entered into. 

18         So I'll leave that with you, and I will leave

19  these with your Executive Director in hopes that

20  sometime in the future, maybe before the next session

21  opens with the General Assembly, you'll give some

22  thought to the addictiveness of slot machines and, and

23  just keeping it under control the way Missouri is known

24  to be doing.

25               CHAIRMAN BARTCH:  Thank you.

 

 

 

00108

01               MR. ANDREWS:  Thank you.

02               CHAIRMAN BARTCH:  Kevin, I think he

03  brought up some fair issues.  We're going to take that

04  under consideration and I'll throw it back to you.

05               MR. MULLALLY:  Yes.  As usual, Mr. Andrews

06  raises some interesting points for discussion and gives

07  some good information for us.  I think it's always

08  excellent to have a variety of perspectives as we look

09  at this issue, and he provides a very needed one and we

10  always appreciate talking with him.  I think one of the

11  things that I think is worthy, worth pointing out, and

12  this is not to be argumentative.  But one of the things

13  that he talked about was that we encourage gambling

14  that curtails entertainment, I believe is the word that

15  he used. 

16         I think that one of the accomplishments of this

17  Commission since its creation in 1993, is that it's

18  been able to develop a gaming market in Missouri that I

19  believe is consistent with Missouri's values and what

20  they, at least the majority of them, obviously,

21  approved, in that they didn't want rampant, widespread

22  gambling on every street corner.  And if you look at

23  the quality of the facilities, the developments, are, I

24  think, in large part because of the gradual approach to

25  licensure that this Commission has taken and its

 

 

 

00109

01  emphasis on quality operators.  When you compare that

02  to what goes on in other states, I mean, if you look at

03  the Kansas City and St. Louis markets and the quality

04  of those facilities, what you see in Tunica and Biloxi,

05  which are both spectacularly successful markets.  I

06  would -- my opinion and I believe the opinion of most

07  folks, is that those, the quality of those facilities

08  is far superior than most of the casinos in

09  Mississippi. 

10         And my point here is that the reinvestment rate,

11  which is something we have pointed to as another

12  successful policy implementation of this Commission, 60

13  percent of the operating cash flow that has been

14  generated by the casinos in Missouri, statewide, has

15  been reinvested back into the State of Missouri.  So

16  for every 100 million dollars, the participants in the

17  industry have made, made from Missouri, they've put $60

18  million of that back into Missouri.  Most of that has

19  been in non-gaming -- I won't say most.  A good portion

20  of that has been in non-gaming entertainment amenities.

21         So that's where I would think there's a little

22  more to that issue of you know, curtailing

23  entertainment.  It's been in restaurants, movie

24  theaters, sports bars, hotels, meeting space, those

25  type of things, and concert halls.  All those types of

 

 

 

00110

01  things that are non-gaming entertainment that bring the

02  focus of this where it should be, that it's a night out

03  of entertainment with discretionary income. 

04         But it is a very interesting topic, and I think

05  we will be able to put some information together for

06  you and something that we should consider as we go

07  about the task of next year's annual report.

08               CHAIRMAN BARTCH:  Is there anything else?

09               MR. MULLALLY:  No.  We will have a closed

10  meeting.  We'll have to have it here, so I'll have to

11  ask everybody to leave. 

12               COMMISSIONER BIELE:  I move to close as we

13  need to receive, discuss, and consider the following

14  matters:  Legal Actions, Cause of Action and Litigation

15  under Section 610.021; Investigatory and Proprietary

16  and Application Records, Information and Summaries

17  under Section 610.021, Sub-section 14; and 313.847.1.

18  Closed Minutes or other closed records that are

19  610.021, Sub-section 14; and 313.847.1, RSMo.

20               COMMISSIONER HINRICHS: Second.

21               CHAIRMAN BARTCH:  Any further discussion? Please call the roll.

22               MS. FRANKS:  Chairman Bartch?

23               CHAIRMAN BARTCH: Approved.

24               MS. FRANKS:  Commissioner Hinrichs?

25               COMMISSIONER HINRICHS: Approved.

 

 

 

00111

                 MS. FRANKS:  Commissioner Biele?

                 COMMISSIONER BIELE:  Approved.

                 MS. FRANKS:  Commissioner Jones?

                 COMMISSIONER JONES:  Approved.

                 MS. FRANKS:  Commissioner Shull?

                 COMMISSIONER SHULL:  Approved.

            (Thereupon, the meeting was adjourned.)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

00112

01  STATE OF MISSOURI )

                      ) SS

02  COUNTY OF PIKE    )

03         I, Elizabeth R. Blackburn, a Certified Court

04  Reporter within and for the State of Missouri, do

05  certify that I was present at the Renaissance Hotel,

06  9801 Natural Bridge Road, in the County of St. Louis,

07  State of Missouri, on the 1st day of December, A.D.,

08  2005; that thereafter, a hearing was held, commencing

09  at 9:00 in the morning of that day, that all

10  proceedings which then transpired were

11  contemporaneously reduced to voice writing by me, and

12  later transcribed into typewriting, and that the

13  foregoing 110 pages are a true and accurate transcript

14  of the record of proceedings made by me at that time.

15         IN WITNESS WHEREOF, I have hereunto set my hand

16  this 13th day of December, A.D., 2005.

 

17  

                         _______________________________

18                       Elizabeth R. Blackburn    #1092

                         Certified Court Reporter within

19                       and for the State of Missouri