Are Casino Host Fees Legal?

Three Pennsylvania casinos are challenging the constitutionality of the host fee it must pay each year to their municipal hosts, according to The Pittsburgh Post-Gazette, Rivers Casino (Pittsburgh), Mount Airy (Poconos) and Harrah's (Philadelphia) have each filed complaints alleging that the host fee, or "local share tax," is unconstitutional. They are being heard by the state Supreme Court.

Under current law, casinos are subject to two different rates of taxation. If gross revenues are more than $500 million, the host fee is two per cent. But if revenues fall under that amount, the host fee is $10 million. So a casino with gross revenues of just $1 million could hypothetically be subject to a $10 million host fee.

Pennsylvania's Constitution (Article VIII, Section 1), states that “[a]ll taxes shall be uniform, upon the same class of subjects, within the territorial limits of the authority levying the tax, and shall be collected under general laws." This single sentence is why Governor Wolf is unable to impose a graduated income tax.

Casinos argue that the Gaming Law unconstitutionally imposes two different tax rates on the same class, i.e. gaming houses with licenses. The Rivers lawsuit calls this "arbitrary and not rationally related to any legitimate governmental purpose.”

If the Sands Casino were to file this kind of suit and win, it would have a devastating impact on Bethlehem. In his State of the City, Mayor Bob Donchez said that without the $9.7 million host fee he received last year, he'd have to increase taxes 39% or lay off 110 cops.

Maybe This Will Tarnish Carl Strye's "Love" For Nazareth

(The following is an open letter to Nazareth Mayor Carl Strye)

Dear Carl,

I threw up a little in my mouth when I saw your latest Express Times spin over an admitted theft. "My love for Nazareth will never be tarnished," you claim. You say you have had nothing but support, no one has asked you to resign, and point to your Facebook sycophants as proof that you are  swell guy. I am telling you, as a Nazareth resident and voter, that I want you to resign. If you refuse, you should be denied ARD, which is what we all know you are trying to get.

You need to resign because, unfortunately, you are both a thief and a liar. You have completely failed to demonstrate remorse. You even think an accused felon can run a police department. This undermines public confidence in government and taints the integrity of every criminal investigation and prosecution being pursued in Nazareth. Nazareth deserves better. Its police department deserves better. If you really do love Nazareth, step down. If not, you should be denied entry into ARD.

Of the 84 votes cast on my online poll thus far, only six persons think you should stay in office. The Express Times call for your resignation was at 81% when I last checked.

You admitted to a Grand Jury that you stole $8,000 from a very worthwhile nonprofit. In reality, you undoubtedly stole a far greater sum, which explains why you go on trips at the drop of a hat and can afford to attend so many professional sports events.

You are also a liar, which goes hand in had with being a thief. You lied to me. Repeatedly. Let's review.

January 2015 Denial

I first got wind of a possible criminal investigation into skimming in January of last year, and I asked you about it. In an email to me dated January 26, 2015, you said:

"You can believe me or not, I did not skim anything. I wasn't brought up that way. I have a very good paying job as a regional Manager of a very large carwash distributorship. But of course, people will say what they want without proving or investigating anything. They only thing I got from the vendor was baseball, hockey or football tickets. Never any money. I do not know what is happening now, because I distanced myself from that to concentrate on being Mayor."

We now know that was a lie. But like an idiot, I believed you.

March 2015 Denial

Over that cold 2015 Winter, amid snow emergencies being declared twice a week, I advised you that I was hearing rumors about a Grand Jury investigation, and asked if you had been subpoenaed. On March 3, 2015, this is what you said: "Berne, I have not been subpoenaed for anything. Do not know anything about it. However, If I were, I would cooperate 100% and let them know the value of these machines and why they are needed in private clubs." I had called you the King of Illegal Poker Machines, and you made this request:

"Can you please stop calling me the Illegal Poker machine person. Everyone in town knows about the poker machines and that the Vigilance had them along with other establishments. You never mention the new president who took over for me. I know I am a target in my position, so I am asking you kindly to stop.

"Man to Man.....Please."

You went on to say:

"Does it look bad on my part? somewhat. But I never had any conversations with our local police while I was in or out of office. It was just they way it was. Right or wrong, the police stayed away.

"According to Vig. Prez.Troy Keenhold, he is not bringing back the machines. He never dealt with the state police and I think he got scared. That is up to him and the Board of trustees of the Hose. I wish them well.

"Personally, I am not a corrupt person. I also think the other municipal leaders thought the same thing. Never even crossed my mind concerning the machines. However, I do get what you are saying. But I think the press has suppressed the poker machine issue and agreed they need to be legalized. This might have taken a little steam or pressure off of who was involved."

Once again, you lied. But like an idiot, I eased up.

January 2016 Denial

As Winter turned Summer and Fall, I discounted most of the rumors until I began seeing Nazareth firefighters going into the Grand Jury. They were obviously not seeking donations. I heard that you had been subpoenaed and asked you about it. On January 14. 2016, you denied  you had been in front of the Grand Jury and added, "I have nothing to hide. I have a very good paying job and can prove my investments. The vigilance hose is not the fleas."

This was another lie. In fact, you had been in front of the Grand Jury just three days before, on January 11, 2016, and had admitted to stealing $8,000. But like an idiot, I still believed you. I even agreed to sit down with you at some future date.

That date never came. Instead, the rumors continued to intensify. On March 16, 2016, I wrote to tell you I had heard you were a target of the Grand Jury.. The DA refused comment, but I told you that a former gas station owner had reported you were entering a plea.

You responded by saying "I have not admitted to anything," followed by "I have no comment."

In fact, you had admitted to stealing two months earlier at a Grand Jury at which you denied being present. Once again, you lied.

But I no longer believed you.

It wasn't until I went through my email exchanges with you that I realized that there is little difference between me and your Facebook sycophants or your "friends" in Nazareth. You spun us all. You are quite the manipulator.

Next time you want to tell some reporter that no one has asked you to resign, remember this email. Resign for the sake of the Borough you claim to love. Stop diminishing the integrity of the police department with your continued presence. If you do not resign, I will ask the DA and the courts to deny your application for ARD. I question whether someone like you, who has displayed no remorse, deserves ARD.

You see, I love Nazareth, too.

Nazareth Mayor Charged With Skimming From Vigilance Hose

Just when you think things could never possibly be more cRaZy in Nazareth than they already are, this tiny borough reaches a brand level of insanity. Today, Nazareth Borough Mayor Carle Strye, age 53, was charged with skimming about $8,000 in gambling proceeds (which itself is illegal), from the Vigilance Hose Company. He was their President before being elected Mayor. This is a third degree felony with a maximum sentence of seven years in the slammer and a $15,000 fine. His preliminary hearing is scheduled for May 3, 9 am, and he has been released on $10,000 unsecured bail. As I write this, he is hiding inside borough hall, hoping to avoid the photographers standing outside.

In the borough form of government, the Mayor serves as the head of the police department. So here in Nazareth, that department is now being run by a man accused of stealing $8,000 from a nonprofit that could use the money. A man who admitted in Grand jury testimony that he stole money from a nonprofit created to serve the community.

Only in Nazareth.

Nazareth also has a Police Chief, a retired cop from the Big Apple, and a Commissioner.  The Commissioner was Strye's idea  He brought in Randy Miller, Northampton County's former Sheriff, to ride herd on the full-timers and destroy the union.

These guys will only work day shift, supervising  two full-time officers and a potpourri of part-timers who get no benefits, are unable to join the police union and hence have no real loyalty.

The ultimate goal of this accused thief and his accomplices on Council is not just to destroy the police union, but to render the police department itself entirely useless.

Reporters await hiding mayor

Commissioner Randy Miller is doing a fine job of making things worse. He brought in one of his buddies, a retired Bethlehem cop, who decided not long ago to ticket a number of cars parked on the wrong side of the street during Sunday Mass. Just weeks ago, he endangered lives in Nazareth with a 70 mph chase [revealed by his own frickin' dash cam] of a suspended driver. Miller denied there was a pursuit even though his pal could be heard on the radio, telling dispatchers that he was "in pursuit." This is also the guy who arrived late for a "shots fired" call that resulted when one Nazareth resident recently invoked the castle doctrine against, of all things, hermit crabs.

Miller, Strye and Borough Council did manage to rid themselves of the best police officer I've ever seen, Freddy Lahovski. They had to pay him the largest settlement ever provided to a Lehigh Valley police officer for violating his civil rights in a country whereit's usually the other way around. This is on top of nearly two years of salary that had to be paid because they illegally fired him. Two other police officers have also filed suit.

You see, Borough Council and Mayor Carl Strye like to meddle in police business.

They don't want cops sticking their noses in places where they don't belong, like the social clubs.

Mayor's parking spot is empty

Look at Council member Larry Stoudt, who tended bar at the local American Legion. He pressured Nazareth police to run the license plate of a suspected informant. He was charged with interfering with a state police investigation, and was later placed on ARD, a special program for first offenders.

Amazingly, Stoudt was easily re-elected.

Though they may have thought they got rid of their problem, they were wrong.

Now Strye has been charged with outright theft, and has no intention of stepping down as Mayor. An accused thief is now calling the shots at the police department.

How could this happen? A little over a year ago, (first reported on this blog), liquor control enforcement officers with the Pennsylvania State Police descended upon three Nazareth area social clubs simultaneously in a raid on illegal gambling. They seized cash and poker machines at the Vigilance Hose and two other social clubs. These raids are almost an annual rite. Clubs get busted, and are back in business the next week.

Although often regarded as a victimless offense, gambling addicts will spend their entire paychecks on a poker machine. Those machines are usually provided by someone with ties to organized crime. Also, unlike a strictly regulated casino, some social clubs will rig their machines to suck money away from some patrons while steering cash to others. Perhaps the biggest problem is skimming. Machine operators often get quite wealthy by pocketing a large percentage of the money used for gambling. Instead of a worthy nonprofit, some steward pockets the money to buy a snowmobile or a second home

Until he was elected Mayor in 2013, Carl Strye was President of Nazareth Vigilance Hose Co, one of the social clubs regularly hit in seven previous raids. At the time of the most recent surprise visit, agents followed one steward to his home, where they seized more money.

How can the police be expected to trust a government official who was the responsible officer for an outfit that was cited seven times before last year's raid? Doesn't this place the fox in the hen house?

Borough police have little to do with gambling. They rely on PSP. But they do have jurisdiction over Crimes Code violations. That would include skimming, which is theft.

After that raid, the social clubs got together and were able to out the undercover officer responsible. They made sure the identity of this person was disclosed at a Super Bowl Party held at Holy Family. But the fun was just beginning.

One Nazareth cop, despite being dumped on from every direction, was sticking his nose where it doesn't belong. That cop is Freddy Lahovski

He began hearing complaints from officers at the Vig that Strye had been skimming from the club. Not just $8,000. Lahovski went to Commissioner Randy Miller. "He ignored me,": Lahovski states. "You're only going to be around as long as you're useful to me," is what Lahovski reports Miller told him.

Lahovski also went to Carl Fischl, the Borough Council member in charge of the police committee, and was ignored there, too.

Realizing he would get no help from a department being run by the person under suspicion, Lahovski took his concerns to the District Attorney. The only person who knew about this was his immediate supervisor, Chief Thomas Trachta, who had gone through the same thing himself when Council member Stoudt wanted him to run the plate of a suspected state police agent. . .

I have been highly critical of Trachta in the past for his arrogance, but he at least is an honest cop and attempted in no way to interfere. Miller, on the other hand, was unhappy when Lahovski told him he had gone to the DA, after the fact  Lahovski  asked the DA to handle the matter because he knew that the DA had the resources, especially an Investigating Grand Jury. Detective John Casciano was assigned, and began the painstaking task of putting together the evidence.

Freddy knew this would be a death sentence to his job as a Nazareth cop. "I'm out of a job, but it was the right thing to do," said Lahovski. "I would do it again."

Eventually, I approached Mayor Carl Strye, who vigorously denied any wrongdoing. He did say he was looking forward to an appearance before the Grand Jury. In my last contact with him, he said he had "no comment."

What is clear is that the Mayor and Borough Council used their positions to retaliate against the very people tasked with the responsibility of protecting the public.

Strye is represented by Bob Eyer. Though Eyer is the Chief Public Defender, he is reportedly representing Strye as private counsel.

As I made my way back home to write this story, I saw a Nazareth police officer. "I'm tired of all this," he told me. "I just want to do my job."

Does Social Club Gambling Really Help the Communty?

In my latest post about gambling at social clubs, I told you that the undercover state trooper at all four social clubs has been outed. Many of you think that the unregulated and untaxed gambling that goes on at these places is harmless and might even benefit the community. But one of my readers has a different view.

To all of you that think the money raised goes back to these organizations is sadly mistaken. This money raised at these clubs goes back into the operating expenses and when you join up most of the clubs will tell you upfront that their affiliations are separate. Holy Family is separate from the church and is not linked to support the church. Hecktown Fire Co does not even have a fire fighter on the board of their social club and most of the board members do not even live in the area of the fire company to ever get there in time to put out a fire. The American Legion in Nazareth has one fundraiser to help their little league and that is all. Look up their financials on line and you will see exactly how these operations work and they contribute nothing to support the communities in which they operate. I have sat at the American Legion and watched a woman pull out a check book to write the legion a check and I am thinking how nice of her. She hands the check to the bartender and the bartender, instead of thanking her, hands her a small game of chance board. Here this woman plays the board off and when she wins the prize she asks for her check back. Is this fair? Can she use her checks written on income tax as donations to a charitable organization? How about going to Hecktown and seeing the bartender with a big roll of payout money in his pocket stand next to you at the poker machine and start putting in 20.00 bills and not playing one dollar or two dollars, but 10.00 a game and hitting a three of a kind or full house and collecting a nice payout for himself. Is that fair? Do you have that privilege? How about going to Holy Family when they had their machines and seeing the machine in use placard on the machine with a payout before the club even opened. Is this fair? Could you do this and get away with it? NO, the rules are enforced for some, but the privileged have no rules. I am happy that there is a crackdown at these clubs, the greed is sickening and by the way, Hecktown's football pool last year was 100.00 a block. The breakdown for that pool left someone pocketing 3500.00 that did not go back to the patrons who played. SO for all of you know it all's [sic] that think you have it right, think again, because even the people in high places in these towns know what goes on and looks the other way or is part of the problem and not the solution.

Nazareth Social Clubs Out Undercover Officer

The undercover state trooper responsible for the recent successful raid on four Nazareth social clubs has been outed. An East Lawn social club employee has already made sure that all the social clubs in the Nazareth know who this person is. At Sunday night's men-only Super Bowl party at Holy Family, he made sure the officers there know. The other Nazareth social clubs have been tipped as well. How he found out is unclear, although I'm sure that Pennsylvania State Police will be asking him. You see, he's been outed, too.

Most of these social clubs are headed by people who are either connected to or are part of local government. For East Lawn, it is former Upper Nazareth Supervisor Bobby Recker. For Vigilance Hose, it was Nazareth Mayor Carl Strye. For the Legion, it was Nazareth Borough Council member Larry Stoudt.

In the past, Larry Stoudt has asked local police to investigate the identity of a club applicant who turned out to be an undercover trooper. Larry was charged with obstruction and ended up on ARD.

Regardless how you feel about gambling, asking local police to do favors for you puts you on a slippery slope.

PSP Raid Shows Connection Between Nazareth Officials and Illegal Gambling

If nothing else, last week's Pennsylvania State Police raid on four Nazareth Area social clubs makes one thing very clear - the connection between illegal gambling and local government officials is extremely disturbing. At the time of the Stickergate arrests, Police Chief Thomas Trachta boasted, "We enforce all the laws and if you break the law, there is a pretty good chance you will be arrested," But Chief Trachta has turned his head the other way at clubs that routinely violate gambling laws. Trachta's boss, Mayor Carl Strye, has been the responsible officer for a social club that has had more than its fair share of legal entanglements.

An online database maintained by the state LCB reveals the following about these Nazareth-area social clubs. .

Holy Family - fined $600 in 1995 and $700 in 2013 for sales to nonmembers and gambling machines. The machines are reportedly out of Holy Family for good,

Vigilance Fire - fined seven times over the years for gambling machines and sales to nonmembers. It has received fines of $1,000, $1,000, $100, $400, $400 and $600. Its license was also suspended once. During most of this time period, Carl Strye was the responsible officer. He is now Nazareth's Mayor.

A Borough Mayor's only real role is to supervise the police department. But when that Mayor just happens to be the responsible officer at a Nazareth club cited seven times for illegal gambling, he makes the police department look like participants who are turning their heads the other way.

Do officers find themselves suspended because they ask questions about possible Crimes Code violations going on inside these clubs? Has Chief Trachta - and I am no fan - been shackled with a "Deputy" Chief  for asking too many questions? Never mind that the Deputy Chief's police certification has expired and he's running around with a badass glock and no authority to arrest anyone.

Except maybe me.

At the Vig, the PSP noticed that there's a discrepancy between the actual amount money on hand and the money that's supposed to be there. They followed a Vig worker named Larry home and confronted him, telling him to fork over all of the money or they would get a search warrant for his home. This Larry went into his home, came out and gave agents an unknown sum of money. But he bragged to too many people about keeping an envelope of money on his person. One of those people told me.

Now if club members are taking money home, or carrying it around on their person, this suggests a pattern of skimming to me. Are gambling proceeds really benefiting the club? Or are they paying for snowmobiles.

The lack of internal controls is appalling.

Much more bothersome than the actual gambling.

Harold V. Knecht American Legion Post - fined seven times since 2000 for falsifying records, training records, sales to nonmembers, gambling and serving visibly intoxicated patrons. Fines go from $250 to $2,600. Long time Borough Council member Larry Stoudt is a bartender at this club, although he has no position of authority. He was charged himself when he asked police to check out a club applicant whom he suspected was being an undercover state trooper. She was. She was working under cover. Charged with obstruction, Larry was placed on ARD.

In Stoudt's defense, let me say I consider him very honest. He would never try to benefit personally from an illegal activity. I've seen him devote countless hours of service to Nazareth. But he did use his official position on Council to ask for something improper.

Nazareth Jacksonian Club - fined eight times for gambling devices and misleading records. Fines extend from $300 to $1,500, This club is where NorCo Dems have often made endorsements in County races. Its license was suspended once.

Nazareth VFW - fined six times for deceptive records and gambling devices. There has been one suspension. I'm getting reports that this outfit was hit in the raid as well, but that has yet to be confirmed.

Hecktown Volunteer fire Co. - fined five times for gambling devices. The biggest fine imposed is $600.

East Lawn Volunteer Fire Co. - no record of fines before last week, which has led to lots of grumbling by other Nazareth social clubs. The President of this club is a former Upper Nazareth Supervisor.

Updated 8:15 am: The Express Times has details from some of the clubs.

PSP Raids Three Nazareth-Area Social Clubs - Seize Cash & Machines

SGT Michael Carroll, who heads the Pennsylvania State Police's Liquor Control Enforcement Bureau in Allentown, has confirmed a raid at three Nazareth area social clubs on Wednesday afternoon. The Hecktown Volunteer Fire Co. Social Club (Rte. 191), Vigilance Hose (Nazareth) and East Lawn Social Club were apparently hit simultaneously. Law enforcement officials seized gambling machines located at all three establishments. They also seized cash from some of the establishments.

Poker machines are illegal in Pennsylvania if they offer payouts to the customers using them. Although often regarded as a victimless offense, gambling addicts will spend their entire paychecks on a poker machine. Those machines are usually provided by someone with ties to organized crime. Some social clubs will rig their machines to suck money away from some patrons while steering cash to others. But perhaps the biggest problem is skimming. Machine operators often get quite wealthy by pocketing a large percentage of the money used for gambling.

In small boroughs, many of the elected officials are also machine operators or officers in these social clubs. In Nazareth, for example, Mayor Carl Strye was until recently the President of Nazareth Vigilance Hose Vo. No. 1. Its social club was hit by the raid. There is no evidence he had any direct involvement in the poker machines. But it is highly likely he was at the very least aware of their use.

SGT Carroll stated that there are no charges at this point, "but there are charges pending." He indicated that agents determine whether there are liquor control enforcement violations, which are ultimately decided by the Liquor Control Board. But he added that, in some instances, there are Crimes Code violations.

Informed sources state that agents followed one steward to his home, where they found and seized money. SGT Carroll refused to confirm or deny that report.

6 Women, 1 Man Charged With Hooking at Sands Casino

Bethlehem Police Blog has the details.

Recession? PA Casinos Enjoy Best Month Ever

You can read about it in The Patriot News.

Tiny Freemansburg Big Winner in Casino Impact Grants

"I am confident in the gamblers of the Lehigh Valley that they will do their committed duty and spend at the Sands Casino."

Those were the marching orders of Stephanie Hoppes-Kovacs, Hellertown's representative on Northampton County's nine-member Gaming Authority, which on October 25 made their first award of gambling impact grants, totaling $1.3 million, to three municipalities.

Instead of taking our money, the one-armed bandits at Bethlehem's Sands Casino are finally finally giving back to places hit hardest by gambling. The grand prize - $825,000 - went to tiny Freemansburg (population 2,063) for a police processing and holding facility. Other big winners were Hellertown (population 5,738) and Lower Saucon (population 10,000), who received the balance of the $1.3 million awarded for police officers, law enforcement training, cruisers, ambulances, pedestrian crosswalks and traffic light signalization.

Bethlehem Township (population 20,000) is larger than Hellertown, Lower Saucon and Freemansburg combined. But it was still the big loser. Despite three applications for an ambulance, police cruisers and a traffic signal device - items similar to what were awarded Hellertown and Lower Saucon - it kept rolling snake eyes. Bethlehem Township failed to supply the documentation provided by other municipalities.

Thomas Nolan, Bethlehem Township's voice on the Authority, repeatedly complained that many of the grants being awarded to Hellertown and Lower Saucon are "budgetary line items" and "annual operating expenses." Then, when he attempted to justify a ambulance for Bethlehem Township, Authority Chair Jay Finnigan turned Nolan's argument against him. "Shouldn't that be part of the budget process?" asked Finnigan.

Northampton County also lost out on a $480,000 criminal justice sharing system despite an impassioned plea from Bethlehem Assistant Solicitor Joe Kelly, who argued this would "better arm police officers" and "make the Lehigh Valley a better place."

During a 2 1/2 hour hearing, the nine-member Authority actually rejected ten of the seventeen applications. Kovacs, a tireless advocate for Hellertown, tried very hard to convince Authority members to go along with a new dump truck. Failing, she wisecracked that they'd now need "sled dogs to get to the casino."

Now the Authority has a more daunting task. It must review 57 applications for grants that require no casino impact. "I don't think we can hear 57 applications," warned Authority Chair Finnigan. So they decided to form a three-person subcommittee to "prescreen" requests. Authority Solicitor Scott Allinson advised that this subcommittee need not meet publicly, but Bethlehem's spokesperson - Joe Kelly- recommended that all meetings be conducted in the open.

Authority members also plan to review the criterion by which they rate grant applications. Alicia Karner, who has been collecting the data, advised there is a too wide a discrepancy in the ratings.

The Gaming Authority will meet again on November 22, 5:30 PM, at the Northampton County Courthouse.

Easton Eagles: Casino Casualty?

The Easton Eagles, located off of Sullivan Trail, was for years a popular weekend gathering spot. Women loved it because they could dance. Men liked the booze ... and the occasional illegal poker machine. Cops usually looked the other way. But this was pre-casino.

I've been there for weekend dances, wedding receptions and birthday parties, too. But like many social clubs, the Eagles have fallen on hard times, struggling with real estate taxes every year. This year, it's cashing in its chips. The building is padlocked. On October 30, at 10 AM, Dotta Auction House will sell the real estate and everything in it.

Prostitution Rate Doubles in Hellertown?

There previously was one, and now, there may be two.

Hey, that's what Stephanie Kovacs claims, and she should know. She lives there. She blames the Casino, and as Hellertown's voice on the gaming authority, is doing what she can to steer money there.

Hookers apparently scrawl their phone numbers on men's room walls at the casino. I tried to check that claim last night, but too many U.S. Senators were hitting on me.

Table Games Clear Major Hurdle in State House

Last Wednesday night, State Rep. Joe Brennan, D-Lehigh and Northampton, rolled home somewhere around 3 AM. No, he wasn't out bar hopping, but was instead involved in a lengthy debate over table games in the state house. Not only was the state House deadlocked, but Joe had to back in Harrisburg the very next morning.

Fast forward to today, and the state House finally passed legislation to permit tables games like poker, blackjack and roulette at Pennsylvania's 14 licensed slot-gaming facilities, including The Sands Casino-Resort in Bethlehem.

Joe voted for this measure because it presents "a real opportunity to create jobs in our area at a time when so many people are losing jobs or already are on unemployment. It spurs economic development to make possible thousands of new jobs across the state while simultaneously providing the necessary revenues for our budgetary needs."

The bill (S.B. 711), which also addresses a number of reforms to Pennsylvania’s gaming industry, is a component of the revenue package necessary to fund the 2009-10 budget state lawmakers completed in October. The measure is expected to raise about $320 million for empty state coffers over the next two years, Brennan claims.

As amended by the House, the legislation would allow Category 1 and Category 2 licensed slot facilities to operate up to 250 table games at any one time, while Category 3 licensees could operate up to 50. Category 1 licensees include racetracks with slot machines, while Category 2 licensees are stand-alone casinos.

Casinos would pay a one-time fee to be authorized for table games, $16.5 million for racetrack and stand-alone casinos and $7.5 million for resort casinos.

Table games licensees would be required to pay a total tax rate of 16 percent on all gross table game revenues, with 14 percent going to the state, 1 percent to the host county and 1 percent to the host municipality. The state share of table games revenue would go directly into the state’s General Fund for budget needs until the state’s Rainy Day Fund balance surpasses $750 million. After that, all table games revenue would be allocated for property tax relief, along with the revenue from slots.

"Throughout Pennsylvania, the addition of table games has the potential to create more than 10,000 direct and related jobs and provide $1 billion in economic output annually," Brennan said. "It also keeps Pennsylvania dollars at home by attracting customers who otherwise may travel out of state – and continues to provide hundreds of millions of dollars for property tax relief across the state."

Another local state house member, Rep. Doug Reichley, R-Lehigh, opposed this bill. He derided a provision that would benefit Scranton's Commonwealth Medical College, whose board includes Louis DeNaples. Perjury charges were dropped against DeNaples earlier this year. "This is another example of literal game-playing going on with this legislation," says Reichley.

Senate Bill 711 now goes back to the Senate for consideration.

Has Northampton County Forgotten Its Rural Poor?

That's what Dottie Niklos thinks. She's the President of the Nazareth Area Council of Governments (NAZCOG). Last night, she told Northampton County Council she wants a seat on the newly formed Northampton County Gaming Revenue Authority. She was joined by Charles Palmeri, President of the Slate Belt Council of Governments (SBCOG).

Niklos told Council that NAZCOG represents around 45,000 people along the southern tier of the Rte 512-33 access corridor, and SBCOG represents an equal number. "It is a great misdeed to have a gambling authority that does not include 90,000 people in the access area." She also mentioned that many of these people are already deprived of services available to city residents, like public transportation and health bureaus.

"The most overlooked people in Pennsylvania is the rural poor. For you to ignore these people is just not right."

The gaming authority, which will be distributing about $1.25 million annually, is currently configured to include mostly Bethlehem area members. Niklos previously called it the "Bethlehem gaming commission."

Northampton County Puzzles Over Slicing Gambling Pie

At last night's Northampton County Council meeting, a new Authority was established, with a fifty year lifespan, to decide how to divvy up gambling revenue once Bethlehem's Sands casino becomes operational. It's called the Northampton County Gaming Revenue and Economic Development Authority. Who will sit on that Authority? How many members? How will Authority staff get paid? Will municipalities be forced to fill out grant applications?

Council members will try to figure that out later. I honestly don't know how they'll avoid litigation, especially because they're dealing with potential windfalls for some communities.

Elected representatives from four of the five municipalities that surround host city Bethlehem were on hand to ask for equal shares. Freemansburg, Hellertown, Lower Saucon and Hanover have already drawn up an agreement to that effect, and expect Bethlehem Township to sign on very soon.

These officials sat in the peanut gallery with me. Hanover Township Manager Jay Finnegan, when he saw me, said "Hey skinny!" For that, I refused to give him a piece of the candy bars Angle was selling before the meeting. Hellertown Mayor Richard Fluck sat right next to me, and I offered to dive on any grenade that might be lobbed our way. "Don't worry," he told me. "I'm shorter than you, so I can get it."

Freemansburg's solicitor, Larry Fox, was their mouthpiece. He broke the ice by telling council, "It's so cold tonight that I saw a lawyer with his hands in his own pockets." He argued that the simplest solution is just to give everyone an equal share of the pie. "We can't do anything unless we have a sum certain. ... Freemansburg has three full-time officers and no lock-up. We can't formulate how we're going to do this until we know what we get."

He also spoke against the grants process. "The only people who will get wealthy from that are lawyers and experts." But as Bethlehem resident and former gambling impact committee chair Bob Pfenning warns, we may have no choice. An Erie County dispute over the proper way to divide gambling revenue is currently bogged down in Commonwealth Court. And once contiguous communities are awarded sums of money, even noncontiguous municipalities like Easton and Williams Township may be entitled to seek excess funds.

If Fox' proposal is followed, it may very well be that Freemansburg will be dipping its hands into the pockets of some municipalities who need a portion of the gambling revenue.

Because the law is so unclear, it is very likely that whatever council decides, this matter will end up in court. In fact, on his way out, Freemansburg Mayor Gerald Yob told Pfenning, "See you in court."

Ferraro: Do We Really Need Another Authority?

That was the question considered by Peg Ferraro's Northampton County Intergovernmental Committee yesterday. The meeting was attended by Council members Charles Dertinger, Diane Neiper and John Cusick. They listened to an informative presentation by Bethlehem resident Bob Pfenning, who has served for the past two years on a gambling impact committee. He told council that gambling revenue must be distributed to five surrounding municipalities by some kind of authority.

Under state gambling law, the five municipalities surrounding the Sands Casino in Bethlehem are each entitled to a piece of the pie, and council member Lamont McClure has proposed a brand, spankin' new layer of government bureaucracy to dole out the dough, currently projected at $2.8 million per year. He calls it the Northampton County Gaming Revenue and Economic Development Authority.

The problem with McClure's proposal, as noted by Peg Ferraro yesterday, is that the state gambling law makes no provision for funding it. She thinks the county should instead use the existing General Purpose Authority (GPA), which is independently funded by other revenue streams. "We don't need another layer of bureaucracy."

Council member Charles Dertinger noted that the GPA currently includes no members from the affected municipalities, but Ferraro quickly suggested that the GPA be expanded. "We're going to have two economic development groups competing against each other."

"You're creating a gambling authority, which is against the law."

Neiper, Dertinger and Cusick support McClure's proposal. Council Prez McHale, in remarks to The Morning Call, appears to like the idea, too.

Instead of doling out equal shares on a per capita or per municipality basis, McClure wants a grants process, which will invite political considerations. Council is struggling to find the most expensive and political way to distribute uncertain gambling revenue.

Update: In a comment to this post, Council member Lamont McClure makes a brief, yet admittedly persuasive, argument in support of a new gaming authority.

The Philanthropy of Sands Bethworks

Gambling strikes me as a stupid waste of time and money. But since we already let people smoke until they get cancer and drink until they kill someone, what's the big deal? If I were King, I'd let people smoke weed, gamble and booze to their hearts' content. I'd even legalize those "massage parlors".

Hey, we're killing this planet anyway, so let's party!

Now all the corporate pitchmen advocate that, no matter what our vice, we kill ourselves responsibly. Those Bud Girls really discourage teenage binge drinking, don't you think? And problem gambling? Who ya' gonna' believe, a billionaire casino owner or some dinky little church always preaching at you? Sheldon G. Adelson, the billionaire CEO behind Sands Bethworks, is even a recent recipient of the Woodrow Wilson Award for Corporate Citizenship, given to those who exalt the common good over their own bottom line. They don't hand those out every day. According to Adelson, "the act of philanthropy and good corporate citizenship is not an obligation, it's an honor."

So don't be worried about that casino, which will contain 3,000 slot machines and electronic table games, 300 hotels rooms, 40 upscale stores, 8 restaurants and 4 night clubs, all of them under one roof. Don't fret about all that money leaving the Lehigh Valley economy and going straight back to corporate headquarters in Vegas. After all, the casino will have lots of menial jobs for you and me. We'll at least have the satisfaction of knowing that our slave wages help the philanthropy of a Woodrow Wilson award winner.

So it's no surprise that Chris Benedict, a Freedom High grad, would ask the new casino to help defray some of the cost of his class' 25th reunion, which will be held at Musikfest this year, jointly with Liberty High School. He's been soliciting corporate and business sponsorships as low as $50.

He was shot down by Susan Stachowski, Executive Assistant to the President, Sands Casino Resort Bethlehem.

"Regarding any request for contributions or investment, unfortunately, we would not be able to participate in any projects requiring financial support prior to our opening. Our commitment to our shareholders and the State is to get the project up and running as soon as possible and we are going to be focusing all our resources on accomplishing that goal."

Gee, she doesn't sound like Woodrow Wilson at all. I thought some things were supposed to be more important than the bottom line. Before that casino was approved, the Sands was handing out money like there's no tomorrow. For example, it contributed $2,500 to one of Benedict's classmates for an annual golf outing, Par Fore Kids, benefiting kids at Pembroke. The casino even threw in a free weekend trip to Las Vegas. I don't know if they threw in any Bud Girls. Now, Benedict's classmate can't even get the Sands to return his calls.

Incidentally, Lehigh County Exec Don Cunningham is a member of Diamond's graduating class. But what has he done lately?

Is Bethlehem Dreaming of a White Christmas?

Before the decision to award a gambling license to Bethworks, there was no real gentrification in south side Bethlehem. Its rentals were similar to rates elsewhere in the Lehigh Valley. But the "imminent slots-and-lofts redevelopment" will certainly change that picture, along with the demographic make up of Bethlehem's south side. It's the new apartheid, bippy. Bethlehem, the Christmas City, will certainly morph into Bethlehem, the White Christmas City. Jersey transplants will be insulated from the Lehigh Valley's riff raff by tinseltowns like The Promenade Shops at Upper Saucon.

Bethlehem is delighted at the inevitable increased tax revenues. But forgotten are the poor, mostly Hispanic, who have little political or economic clout. I don't see any effort to expand affordable housing for those who will be displaced. They'll be nudged aside for latte-sipping yuppies, a process that occurs regularly in several U.S. cities.

So just as the original Bethlehem had no room for Jesus, neither does its Pennsylvania namesake.

Poetic Justice for Larry Holmes

Have you ever seen Larry Holmes, the Easton Assassin? Doesn't seem the killer type. Every time I've seen the former heavyweight champ, he has a faint smile. I've met him a few times over many years, and he's always been generous to a fault. A gentle giant. But however docile he may appear, he still knocked out 44 people in his boxing career. He's a monster in sartorial splendor.

Before I continue, I have to warn you this tale might be a complete crock, a Lehigh Valley legend. I haven't checked it out. I'm nevertheless repeating it because that's what we bloggers do. Besides, even if this story has no foundation in fact, it should.

The way I hear it, Larry was in a line at one of our local convenience stores, waiting to play the lottery. Larry likes to gamble. When it was finally his turn, Larry insisted on playing his own numbers instead of using machine picks. Athletes are like that. They have a bizarre fascination with numbers. I'm surprised more aren't physicists.

Well, some cranky bastard behind Holmes (no, it wasn't me) lacked this numerical obsession, and was indignant that Larry was taking so long. He started complaining that Larry was slowing things down for the rest of them. Perhaps he was trying to commit suicide. I don't know, but there it is.

Instead of turning around and plastering this guy, Larry decided instead to play another ten games. This time he let the machine pick the numbers. And as luck would have it, Larry won big. Some say $1,000. Others say $20,000.

What's ironic about this is that if the curmudgeon behind Larry had patiently waited his turn, he would have been the big winner.

Morals of this tale? 1) Good things come to those who wait. 2) Don't mess with the Easton Assassin.

Pennsylvania Gaming Control Board: It's Bethlehem!

After a suspiciously late start, Pennsylvania's Gaming Control Board quickly got down to business. It's Bethlehem!! Damn! I just lost $20. Allentown is going to be pissed, especially since Rendell just dropped off $18.5 million in Bethlehem on Monday.