October 27, 2005


Charitable crackdown

By Kymberli W. Brady
Staff Writer

In the midst of final preparations for its sold-out Texas Hold’em tournament, the Almaden Business Association [ABA] faced a dilemma—hold the charity tournament or risk a raid by the Department of Justice and the Alcohol and Beverage Commission.

The Almaden business Association fundraising committee takes a sneak peak at the Children’s storytime area of the new Almaden Library, slated to open in January. Shown from L-R; Carole Edman, Jim Kabel, Rich De La Rosa, Edie Fehling, Cathy Spielberger Cassetta , Rich Crowley, Doug Keller, and from the San Jose Firefighter’s Association, Mark Skeen.

The tournament, months in the making, was organized by ABA member Rich Crowley, along with ABA board members in an effort to raise money for the new Almaden Branch Library. The original goal was to secure $15,000 to sponsor the Children’s Storytime area—and more if possible to either sponsor or support other areas of the library.

Event Chairman Rich Crowley admitted that he was disappointed, especially after spending two hours working through every possible scenario.

“We tried to figure out how we could still do this,” he said. “We covered everything we could with the guys in the state.”

Board members were surprised to learn that despite 100 percent of the proceeds going to charity and donated prizes that would be awarded in lieu of cash payouts, a laundry list of loosely or ambiguous interpretations of the law made it nearly impossible to hold even a friendly game without violating something. Additionally, if a group is successful in finding a way through the legalities, they still have to convince the state to issue a license to put the event in compliance.

“I was hoping we could fix it,” said Communications Chair Rich De La Rosa. “But there was no way. They would not allow us to fix it.”

“There are a whole lot of areas in the law that are open to interpretation and are up for legal review,” explains DOJ Special Agent in Charge Marty Horan. “We’ve submitted a lot of the questions over the past year from the public and people who are holding these events to the attorney general’s office for a formal opinion, and we are waiting for review.”

“I think it is unfortunate that a group of volunteers work hard to build a better community,” said Silicon Valley San Jose Chamber President Pat Dando. “In this case, it was raising money for a reading room in the library and a government agency shuts them down.

Using common sense
Dando admits that she had no idea the tournament she held at the Fairmont Hotel to raise money for the Stroke Awareness Foundation in March was illegal and doubts if any of the participants did either. In hindsight, it violated nearly every gambling law on the books, starting with a $1,000 buy-in and $17,500 in cash prizes awarded to the top three finishers. Black Jack tables and roulette wheels, banned from any game outside Indian casinos, were also heavily played. But in looking at the bigger picture, she stressed that they were not in it for financial gain, rather to subsidize programs that the government had already cut to the core.

“Again, we were a group of volunteers raising money for education for stroke awareness,” she said. “And we raised a sizeable amount of money.”

When asked why the DOJ will allow one event to go forward, while they shut down another, Horan insisted that the DOJ did not know about Dando’s event—despite the heavy publicity. He said they cannot go after all of them.

“We simply were not aware of it,” insists Horan. “Over the last couple of years when everyone wanted to play, they started becoming more and more frequent, more and more publicized. Citizens against gambling are now complaining and card rooms are complaining and the Division’s view, which is supported by the attorney general, is that all these events are illegal. Monte Carlo nights alone with the roulette wheel are illegal. It’s a violation of the Johnson Act—it’s like having a slot machine.”

The raffle scenario all over again
Dando says this scenario has played out before and thinks back to when she says the DOJ went after seniors for playing bingo.

“This is just about as absurd as that,” she said. “It also begs the question that surely the Department of Justice has more important crimes to investigate and close in on, other than volunteers who are having a fund-raising event,” says Dando. “For my tax money, I would much rather have them go after sex offenders and other felons than community volunteers raising money for a library. I think it’s an atrocious waste of taxpayer money. I feel that there are far more serious crimes in this state that they should be dealing with. It kind of reminds me of a few years ago, when they went after seniors playing bingo. Again, this is just about as absurd as that.

Dando says that although she feels strongly about safe neighborhoods and has openly supported law enforcement, she feels that with limited dollars, they should be focusing on priority crimes.

“This comes nowhere near being a priority crime,” she says.

District 10 Councilmember Nancy Pyle agrees.

“I say search for the crime,” she says. “And there is no harm when you’re doing this for charitable causes. I think the chamber needs to take a strong stand in formulating policy.”

In spite of everything, charity is alive and well
Yet on Saturday morning, instead of decorating and putting the final touches on an event more than four months in the making, ABA board members met at the library for a sneak peak. And despite the cancellation of the tournament, Mark Skeen, on behalf of the San Jose Firefighter’s Association, presented the association with a check for $1,000.

“We heard this got shut down,” Skeen said. “And regardless of having the game or not and regardless of the DOJ coming in and shutting it down, we thought we could pony up a little bit of money and still make this a success.”
By 10 a.m., roughly 75 percent of those who had responded followed suit.

In the wrong place at the wrong time
Understandably, the committee was upset to learn that someone had called in a complaint, forcing the DOJ to take action, but they were shocked to later discover that the source of the alleged complaint came from the Garden City Casino, a Chamber member.

Casino Manager Al Polito admitted that he had faxed a copy of the ABA invitation to San Jose Police, but only after trying unsuccessfully himself to pull together a fund-raising event for the Franklin McKinley School District.

“We did not in any way wage a protest,” Polito insisted. “If anything, we were trying to do the same thing and I was only trying to understand why I couldn’t make it happen without opening it up to my customers when these things were going on all over the place. This one had just arrived in the mail and I used it as an example. When they asked me to fax it over to them, I had no idea it would lead to this. I saw the Chamber logo on it—that would be suicide!”

“I believe it’s not what he wanted to have happen,” said De La Rosa. “I don’t think he was aware that it would shut us down. I understand that he needed to send it because they have to work with the police. The bottom line is people are doing their jobs, and it’s kind of tough for me to really criticize when that’s the way the law works.”

According to De La Rosa, the DOJ stressed that recent attempts to crack down on violators can be attributed to the increased popularity of the game, which has made officials more sensitive to what’s happening around them.

However, it is a law that he feels needs to be changed
“If nothing else comes out of this, there needs to be some changes made so groups like ours, without repercussion of getting cited for doing something like this can have a nice little event and raise money for people.”

“The irony here,” says Dando, “is that volunteers in this case, were in the throws of raising money to offset funding that the government stripped away with budget cuts, only to have a government office shut them down. How unfortunate it is that volunteers have to raise money to buy books for the library. And then they are scrutinized and closed down by the DOJ. I just think they’re way out of line.”

Looking ahead
For Crowley, the true nature of the group came through as one that didn’t get upset or lose composure.
“This group of people has worked so hard on this,” he said. “There was no one saying, ‘woe is me.’ They were saying how can we make this work? They are local business people who like the community and want to make this work. They’re not stopping from doing it—there’s no quitting. We’re still going to raise more money and we’re hoping that out of this sow’s ear, we can make a silk purse.”

In fact, they have already surpassed their initial goal and were looking ahead to the possibility of raising enough to sponsor another room at the library.

“Its really been reflective of the tremendous support in the community,” said ABA President Cathy Spielberger Cassetta, “for the event and certainly for the fundraising project.

“Still, we want to apologize for the inconvenience this has caused everybody,” stressed former ABA President Doug Keller. “But we simply couldn’t put the Library Foundation’s nonprofit status at risk. We had the best of intentions.”

What’s the big deal?
After nearly 25 years of successful Casino, Monte Carlo, Texas Hold’em, and Poker Nights, some groups say the stakes are getting too high, especially when out of pocket expenses could instead put the organization further in the red if shut down.

The sudden crackdown comes at a time when the popularity of the game has resulted in a bigger presence and the DOJ attempts to enforce the law. Government cut backs have become so severe that fundraising measures are now mandatory in order to keep schools, libraries, and other community organizations open and operating.

According to World Poker Tour Spokesman Jim Lewellyn, an estimated 50 million people played poker at last count a couple of years ago—a number that could be significantly higher given the current Texas Hold’em craze that has swept the nation, thanks in large part to the World Series of Poker, a game of chance and skill that has tickled the fancy of men and women alike—and serves up a perfect recipe for successful fund-raising venues looking to meet their financial goals. In the last year alone, thousands of tournaments have been run by a variety of organizations for fun, charitable fund raising.

Dando agrees.

Time for change
Every day, more people find it difficult to find fault with those who gamble and risk no money while raising money for nonprofits that support schools, sports, law enforcement, the arts, or a variety of other worthy causes. In fact, many of the 90,000 nonprofits in California, including schools, churches, chambers of commerce and other groups hold so-called casino nights and similar events.

Many we interviewed said increased DOJ crackdowns will only force the issue back into another impassioned debate in the legislature.

In an earlier attempt this year to change the rules and make exceptions for charities to hold such events, Assemblyman Alberto Torrico (D) Fremont, introduced AB 839 in February but it failed to pass the appropriations committee in June.

The bill however, is alive and well, according to Torrico spokesperson Sam Delson, and will be re-introduced again in January.

“It was with the appropriations committee, which concern themselves with costs and fiscal impact that it stalled,” said Delson. Still, we think the law needs to change and are working to convince some other folks of that.”