Feb. 12, 2002 – Try as they might, senators failed Monday night to find the contract between the V.I. government and Caribbean Lottery Services Inc. illegal. Both Attorney General Iver Stridiron and the Legislature's legal counsel, Yvonne Tharpes, called the agreement "legally sufficient."
And, according to Caribbean Lottery Services spokesman James M. Christian Sr., the lottery is "up and running, with overwhelming acceptance." Christian, representing Robert Washington, the company chair and chief executive, said two prizes — one of $500 and another of $2,000 — already have been won.
The company is in the process of setting up 110 terminals in bars, restaurants and other locations, Christian said, with 24 in place so far. It has opened a retail center at Port of $ale mall in Havensight, managed by its local marketing director, Richard Counts.
Caribbean Lottery Services has agreed to give the V.I. government 10 percent of its gross receipts over the 10 years of the contract.
Five of the 20 individuals invited to testify before the Economic Development, Agriculture and Consumer Protection Committee showed up Monday night. Little new information was forthcoming at the hearing, called by the committee chair, Sen. Adelbert Bryan, in the wake of two Finance Committee meetings last month on the same issue.
Notable by his absence was the V.I. Lottery director, Austin Andrews. Bryan said he had contacted Andrews several times regarding the hearing. Other absentees included the Casino Control Commission chair, Eileen Peterson; Property and Procurement Commissioner Marc Biggs; the governor's chief legal counsel, Paul Gimenez; and the Economic Research Bureau director, Lauritz Mills.
The senators quizzed Finance Commissioner Bernice Turnbull, who by virtue of that office chairs the V.I. Lottery Commission, and Office of Management and Budget director Ira Mills, who by holding that office is a commission member. They are the only current members of the seven-member Lottery Commission, but both said they were not in on the negotiations. Turnbull said she had not been aware of the letting of the contract but was "not surprised, either." Mills said he was on sick leave at the time. Both said they subsequently received copies of the contract.
The terms of the last appointees to the other commission seats expired in 1997. In December, the Senate passed an amendment giving the lottery director authority to act on behalf of the commission "until it has a quorum." This is what Andrews did in signing the lottery contract.
Sen. Vargrave Richards issued a plea to the governor to name commission members and "send the nominations to the Legislature for approval to maintain the integrity of the system, and quell the belief that something sinister is taking place."
Richards voiced approval for Caribbean Lottery Services. "Here is an opportunity to develop a different type of lottery. It was on Andrews initiative. I think it is good," he said.
Sen. Emmet Hansen II disagreed. "I've said before, I'd like to see the Request for Proposals," he said. "Andrews told me he would send it to me, and I still haven't gotten it."
Stridiron said, "All contracts are not subject to RFP's. A contract of this magnitude, the governor would make the decision, and then the process goes through the Department of Property and Procurement."
Some contracts "don't lend themselves to an RFP and are not susceptible to bidding," Stridiron added. He suggested that Andrews may have "misspoken" in telling Hansen he would sent the senator a copy of the RFP.
"I don't think so," Hansen replied. "It was a conversation on a local television show. Either there is an RFP, or there isn't; I need to see one." Hansen then made a successful motion to subpoena the RFP and all documents associated with the lottery contract.
Bernie Burkholder, president and chief executive of Treasure Bay Gaming and Resorts Inc., parent company of the firm that operates the Divi Carina Bay Resort and Casino on St. Croix, said he made a special trip from the states to attend the hearing. "I want to find out if this is connected to the video lottery terminals," he said of the outside lottery contract.
Divi's casino is the first and only one operating in the territory to date.
Under questioning, Christian said repeatedly that Caribbean Lottery Services, a subsidiary of Leeward Islands Lottery Holding Co., which is owned in part by Black Entertainment Television, has no plans to install video lottery terminals in the territory. "We're not in the VLT business," he said, and the company has no intention "of developing VLTs."
Burkholder, an adamant foe of VLT's, wasn't satisfied. "If there is any way of guarding against that, I would like to see it done," he said.
In January, the Senate for the third time passed legislation authorizing VLT's on St. Thomas and St. John but not St. Croix. Several years ago, Southland Gaming was contracted by the V.I. Lottery to operate VLT's if and when they become legal in the territory.
Gov. Charles W. Turnbull vetoed the two previous attempts to bring the machines to the territory. On Monday night, before the hearing began, Sens. Celestino A. White Sr. and Donald "Ducks" Cole told reporters that if the governor vetoes the legislation this time, they will get an override.
Bryan questioned Christian extensively about hiring local employees and asked for an accounting of the company's financial projections. Christian said he would provide the information on Tuesday. Bryan said he wants the Legislature's Post Audit Division to analyze the figures.
Bryan said another meeting of his committee would be needed to go over the information to come from the post auditor.
Committee members attending the meeting were Sens. Bryan, Cole, Hansen, Roosevelt David, Richards and White. Sen. Norman Jn Baptiste was absent.
Those invited to testify who were not present, in addition to Andrews, Petersen, Biggs, Jimenez and Mills, were: Casino Control Commission vice chair Emelda Dizon, member Lloyd McAlpin, gaming enforcement director R. Oliver David and executive director Shawna Richards; Robert Washington, chief executive officer, and Clovis Tobias, former resident agent, Caribbean Lottery Services Inc.; Bradford Whitmore, president, Grapetree Shores, Divi Carina Bay Resort; Todd Newman, attorney, Divi Carina Bay Resort; Jeffery A. Moorhead, attorney, Robin Bay Associates; and Linda Baxter, attorney, Golden Gaming Inc.


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