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Clarification appendedJust weeks after the introduction of a bill that would, to a large extent, relax recently enacted, tighter regulation of charity poker games, the executive director of the Michigan Gaming Control Board has proposed new rules that would tighten regulation of the games even further.Among other things, the newly proposed rules would sharply limit the number of so-called millionaire parties taking place at permanent poker rooms and have the effect of limiting permanent poker rooms from hosting more then 30 days‘ worth of events each year.The new rules knowles-cadbury-brown.co.uk , posted here, would replace prior rules put in place while the charity poker games were under the oversight of the state’s lottery bureau.Rick Kalm, executive director of the gaming control board, said the new rules are needed to protect the players and the charities that are meant to benefit from the games, and to assist the board in regulating the games.Kalm: Legislation did not consider charity poker roomsThe Traxler-McCauley-Law-Bowman Bingo Act of 1972, which governs charity poker games, among other things „did not contemplate charity poker room/casinos,“ Kalm said in an email.“They are unlicensed, no requirement for backgrounds checks for dealers, no mandate for security, no required surveillance, no patron dispute requirement, no training to recognize problem gamblers, no reporting requirement as that is on the casinos, no chip control mandate, no card control mandate (and) inconsistent rules at best.“The parties generated $184 million in cash activity in fiscal 2012, up from $3.4 million in 2003 but down from the reported $194 million generated by charity games in 2011, according to the Michigan Bureau of State Lottery’s Charitable Gaming Division.Last year, charities made $19 million from the games, and suppliers and room operators made $18 million, Kalm said. That was up from $3.5 million in net profit to charities in 2004 and $825,000 in revenue for licensed suppliers and gaming room operators.Opposition says new rules would ‚devastate’Gaming suppliers, permanent poker room operators and legislators argue the new rules would devastate the charity poker industry in Michigan. So far, I’ve not heard from charities on the new rules.Allowing just one charity to host a millionaire party at a site per day and allowing sites or poker rooms to host no more than 30 days‘ of events per year „… are enough to completely shut the industry down,“ said Scott Menser, a licensed, for-profit supplier who operates the charity games held at Doc’s Sports Retreat „Poker Room“ in Livonia, in an email.“We have a great industry that has done a ton of good and should be saved. We are willing to work with the state and make this work on their end, as well, but the current changes are just meant to put us out of business,“ he said.“We can accept some changes, but give us a chance to survive.“The state has effectively shut down 14 permanent poker rooms since 2010, Kalm said, by denying licenses to charities seeking to hold charity poker games at them.Kalm took on oversight of the millionaire parties in October 2011, per an executive order from Gov. Rick Snyder, but said he and his team were assisting the Lottery Bureau in investigating millionaire parties even before that.Kalm has also put in place new regulations that allow only two to three charities to host games concurrently at a single site and issued a moratorium on new, approved permanent poker room sites.Under his direction, the gaming control board has also denied licenses to charities seeking to host millionaire parties at events where investigations have turned up illegal gambling, manipulation of the number of chips being sold and other illegal activity. That’s led rooms such as the state’s largest operator, Snookers, to close.A closer look at the rulesSome of the newly introduced rules would codify the requirements and interpretations that Kalm has already put in place, as well as a midnight curfew on the games that Ingham County Circuit Judge Clinton Canady ruled could not be enforced under the current rules.But other rules would tighten regulation even further.Under the new rules, charities would be required to disclose if any of their employees or officers have ever been convicted of certain crimes or are involved in pending litigation or lawsuits related to a millionaire party. The new rules provide for the same scrutiny of dealers, who can’t be employees of poker room operators, and the owners or principals of sites where the games will take place.The rules would give Kalm the ability to deny millionaire party licenses to those lying on their applications or seeking to host games at venues where illegal gambling equipment is or has been present.Charities would be required to show proof that they raised at least $2,000 through other types of fundraising in the prior year, as evidence that they don’t exist just to operate millionaire parties. And they’d be required to have at least five „bona fide“ members of the charity on hand at any time to help run the games.The rooms or venues where charity games would be played would be subject to pre-inspections, and the gaming control board executive director would have to approve the games and rules of each game that can be played at millionaire parties.But perhaps the most controversial rules are those that:would enable the gaming control board executive director to stop issuing licenses at any time, for any reason. (Kalm said that authority is necessary to ensure the integrity of those involved in the games, to protect charities and in the event that regulatory resources are unavailable.)would limit any single location from hosting millionaire parties more than 30 days each year, by denying licenses for subsequent games at that location.would limit the amount a location or room can charge a charity to host a game there to no more than $250 per day, including location rental, food and drink services.allow just one millionaire party at any location per day.“If you look between the lines, this is an attempt to close all poker rooms in Michigan and will devastate charities that benefit from them,“ said Mark Godsey of Joey Armadillo’s Inc., owner of Joey Armadillo’s Bowling Alley, Sports Bar, & Restaurant, a permanent poker room in Niles.The problems that have been outlined with charity gaming are no worse than the problems encountered at Michigan casinos, „yet no attempt to close them has been made,“ he said in an email. Godsey said he believes that if passed, the new rules will renew private, illegal poker games that bring no benefit to local charities or millionaire party businesses.“We are having a hard time figuring out why Richard Kalm wants to close these venues instead of regulating them so all can stay open and obey the law like the casinos do knowles-cadbury-brown ,“ he said.Lawmakers weigh inLining up behind those opposed to tighter regulation of millionaire parties are legislators, including State Rep. Jeff Farrington, R-Utica, who introduced House Bill 4960 in early September. The bill would largely relax some of the recently enacted regulation on millionaire parties.Following the posting of the gaming control board’s newly proposed rules, Rep. Jeff Irwin, D-Ann Arbor, issued a resolution asking the gaming control board to reconsider what it’s proposing.Irwin said he backs Farrington’s bill and more relaxed, modest regulation of the charity poker games.“Those operations have raised millions of dollars for charity and provided hundreds if not thousands of jobs,“ he said. „Richard Kalm, on behalf of the casinos, is trying to drive these (gaming) businesses out of business.“Modest regulations could better regulate operators to keep them in line with rules and prevent charities from losing money, Irwin said.The gaming control board is funded through revenue largely from the casino industry, he said. „Clearly it’s good for the casinos to shut down these (charity poker) operations.““What Rick Kalm has proposed is not aimed at regulation aimed narrowly targeting abuse, it’s regulation aimed at annihilation of these businesses and the opportunities the charities have,“ an outcome that was predictable when Snyder assigned oversight of the games from lottery to gaming control, Irwin said.Kalm said that under the law, charities are supposed to get all of the profits of the charity poker games and spend only what’s needed for necessary and reasonable expenses that cannot exceed 50 percent of their profit.“What has occurred is locations now charge 50 percent regardless of the expenses. That is not within the law,“ he said.Instead of expenses going down with multiple charities hosting games at one site, charities are still held to a 50/50 split of profit from the games, Kalm said, assuming they aren’t losing money on the games.The charity poker gaming industry over the past three years has under-reported chip sales to try to comply with the bingo act reporting requirements, Kalm said. „… We simply cannot regulate and insure integrity in the present format. These rules are trying to align what is going on with the current law.“Limiting permanent poker rooms to hosting 30 days‘ worth of events each year is a start, Kalm said. „We will hold public hearings and listen to what is said and finalize the number prior to finalization. Those could change.“The gaming control board also plans to lift the moratorium on new approved locations, Kalm said, to open up new locations to charities seeking to host millionaire parties.Clarification: The story states, according to state Rep. Jeff Irwin, that the gaming control board is funded through revenue largely from the casino industry. The Michigan Gaming Control Board clarified  that in actuality, the oversight of charitable gaming millionaire parties is funded by money budgeted from the Michigan Lottery pull-tab sales. 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Tighter regulation, fewer events at permanent poker rooms proposed for millionaire parties

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