Jan. 13, 2005 — Two gambling promoters, both with Virgin Islands ties, are trying to revive an effort to bring slot-machine gambling to Washington, D.C., an effort that had previously appeared to be dead.
The promoters had sought to add a referendum to the November 2004 ballot in the District that would have permitted the creation of a 3,500 slot-machine complex in a low-income area of the nation's capital. But last year the D.C. Board of Elections and Ethics, chaired by former St. Thomian Wilma Lewis, a prominent local attorney, said that the petitions filed for the referendum lacked sufficient valid signatures. The board's decision was later ratified by the District of Columbia Court of Appeals. (See "V.I. Figures Key in "D.C. Ruling and VLT Initiative").
The Washington Post reported Jan. 6 that the gaming promoters had very quietly hired a petition-gathering organization and had secured what it claimed to be 6,000 signatures for the referendum. This had been done over the holiday season and went unnoticed by the press.
The promoters, Shawn Scott and Rob Newell, also have hired a Connecticut lawyer, Martin Gersten. It is Gersten who argues that the 6,000 new signatures should be added to the some 14,687 that had been regarded as valid in the past, as the old signatures were good for a period of 6 months. This, he said, would bring the total number of signatures over the 17,599 mark needed to put the proposal on the ballot when D.C. next votes, in November, 2006.
Newell is a St. Croix resident, and Scott, according to the Post, also lives in the U.S. Virgin Islands. Two firms associated with Newell, North Atlantic Investments, LLC, and the financial backer, Bridge Capital, have spearheaded the proposal. The Post reported earlier that Bridge Capital owned a building in Frederiksted.
Meanwhile, back in the islands, Bridge Capital's application for benefits from the V.I. Economic Development Commission has been approved and the company has been granted their final certificate.
In an earlier article the Post had said Newell was "an Idaho businessman with a long history of troubled business deals." The Post also said a "Spokane, Wash., investment firm of which he was an officer dissolved after state regulators accused it of swindling people."
The Post characterized Scott as "a Las Vegas entrepreneur who has been denied or failed to obtain gambling licenses in five states where regulators found evidence of financial mismanagement, irregular accounting practices and hidden partnerships."
The effort to revive the once-quashed initiative came as a surprise to at least three of the promoters' former D.C. allies; the most prominent of them, Pedro Alfonso, a Washington businessman, promptly resigned as chairman of the political action committee that had been supporting the effort. "There were a lot of things going on without my knowledge," he told the Post. Two other officers of the committee resigned as well.
One of the most controversial aspects of the initiative was that it would have created a gaming regulation system without needing a vote from the D.C. City Council which would have freed the gambling operation from any effective regulation or at least that was the description used by the proposal's critics. Currently there are no slot machines in the capital, and no legal framework for the regulation of them.
The promoters said that their proposal would create numerous jobs, revive a faded portion of the city, and bring additional tax funds to the City's treasury.
It is now up to the Board of Elections and Ethics to figure out if the whole issue can be re-opened, as Scott and Newell want. The Board's attorney, Kenneth J. McGhie, told the Post that while it is true that the law gives petition circulators six months to gather petitions the Board's regulations say "once an initiative has been rejected, you have to start the process anew."
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