Casino group rebuts lobbying label

Legislators skeptical of group headed by former Supreme Court justice

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HARRISBURG -- The House Gaming Oversight Committee is studying the response from an association made up of three Pennsylvania casinos after questions were raised over whether the group's activities constitute lobbying.

The Pennsylvania Casino Association strongly asserted that it is not a lobbying group in its response to an inquiry from state Rep. Dante Santoni, D-Berks, chairman of the House Gaming Oversight Committee.

However, it acknowledged it provided $100,000 toward Philadelphia developer Peter DePaul's legal bills in his successful fight to get the Supreme Court to overturn a ban on campaign contributions from casino owners.

The association's response was from high-profile Philadelphia attorney Richard Sprague, a board member of the nonprofit trade association and part-owner of SugarHouse Casino in Philadelphia. He said in his letter that the association "has not supported any litigation while it was pending before any court."

The $100,000 was paid after the case had been decided in April. It was given because the suit advanced the interests of the gaming industry by affording casino owners "the same rights as other citizens to make campaign contributions if they chose to do so," Mr. Sprague wrote.

During a 15-minute speech on the Senate floor last night, state Sen. Jane Orie, R-McCandless, railed against the association, saying it failed to disclose the names of its employees and officers, particularly Michele Zappala Peck, the group's operations director, who also serves as a special master to the Allegheny County Court of Common Pleas Board of Viewers.

"This information is disconcerting on a number of fronts," said Ms. Orie, a longtime opponent of gambling. "It begs the question: can a member of the judiciary lobby?"

Ms. Orie accused the casino association of "blatantly disregarding" federal tax laws that require the disclosure of officers and key employees. The association's Internal Revenue Service filings do not list Ms. Zappala Peck or her father, former Supreme Court Chief Justice Stephen A. Zappala Sr., who is the group's chairman and former executive director.

"Why the cloak of secrecy?" she asked. "It's unconscionable."

Ms. Orie is embroiled in a separate controversy involving the Zappala family. Allegheny County District Attorney Stephen A. Zappala Jr. -- son and brother of the casino association officers -- is investigating allegations that the senator allowed political work to go on in her state office on behalf of her sister Supreme Court nominee Joan Orie Melvin.

Ms. Orie's attorney Jerry McDevitt last month accused the district attorney of executing an overly broad search warrant that gave him access to computer files detailing the senator's anti-casino strategies.

Ms. Orie isn't the only lawmaker concerned about the activities and officers of the casino association.

Mr. Santoni has been asking for weeks why the association appears to be lobbying but has not registered to do so, as required by state law. A Post-Gazette article last year first raised questions about whether the group needed to register to lobby and whether it properly disclosed the names of its top officials.

One board member, Charles Hardy, initially told the Pittsburgh Post-Gazette that the association had not been involved in litigation. Reached again more recently, Mr. Hardy elaborated on his earlier comments, explaining that the association had not actively participated in any litigation and made the $100,000 payment to cover Mr. DePaul's legal bills only after the matter was settled.

"We were never a party to litigation -- the association was not a party to litigation," he said.

Regarding other activities, Mr. Sprague indicated that his group's communication with lawmakers about pending legislation was limited to three e-mail messages, which cost about $460 to write and send.

The state's lobbyist disclosure law requires registration only if lobbying efforts cost more than $2,500 per quarter.

Mr. Sprague also indicated that his group funded a radio advertisement that advocated a 12 percent tax rate on revenue from table games such as poker and blackjack. He did not say how much that ad cost, but said the commercial did not constitute lobbying because it did not mention a specific bill and did not ask listeners to contact lawmakers.

Mr. Santoni isn't so sure and is seeking a legal opinion.

"The association's activities concern me, but I'm not sure where I want to go with it at this point," Mr. Santoni said.

He said he wants more information about the association's $100,000 payment to offset legal expenses for Mr. DePaul, a co-owner of Foxwoods Resort Casino in Philadelphia.

Mr. Sprague indicated that no staff members of the Pennsylvania Casino Association have made any campaign contributions to state officials or candidates.

The casino association has three members: SugarHouse, the Rivers Casino of Pittsburgh and Mount Airy Casino Resort in the Poconos. In its filings with the IRS, it lists its "primary exempt purpose" as "Improve the business conditions in the gaming industry generally and to create a better understanding of the gaming industry by the general public, elected officials, other decision makers and the media through education and advocacy."

In letters sent late last year, Mr. Santoni asked all three to explain their relationships with the association. Only The Rivers and SugarHouse responded.

In a written response, a spokesman for The Rivers said he, too, had questioned leaders of the Pennsylvania Casino Association after a Post-Gazette story in October.

Paul Seeman, the SugarHouse spokesman, told Mr. Santoni that the association assured him it had complied with all applicable lobbying laws.

"We share your view that all participants in the casino industry must be beyond reproach and we are committed to the highest standards of integrity for the industry and for the [Pennsylvania Casino Association]," Mr. Seeman wrote.

Mr. Santoni said he hasn't heard from Mount Airy, and casino spokeswoman Wendy Wilson could not be reached.


Dennis B. Roddy contributed to this report. Tracie Mauriello can be reached at tmauriello@post-gazette.com or 717-787-2141.


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