CHARLESTON, W.Va. --
The president of Princeton's Fraternal Order of Police admitted to West Virginia Lottery commissioners Thursday that he's never been to the chapter's lodge, which is located three hours away -- in Ritchie County."I now know how it looks like from your side, that we're not there, we've never been there, and some of our employees there don't even recognize my name," Bryan Grimm told the commission at the first of four hearings on questionable fraternal organizations operating limited video lottery locations.For four months, the Lottery has been investigating complaints of video lottery locations set up under the auspices of being members-only fraternal organizations. Such groups are allowed to operate 10 video lottery machines, instead of the maximum of five machines allowed in bars and clubs.As to how the Princeton FOP in Mercer County ended up with its lodge in Harrisville, the Ritchie County seat, Grimm told commissioners the FOP was approached by Action Gaming, a video lottery machine distributor based in Wheeling, with a turn-key offer to get into the LVL business."Action Gaming approached us, and said, 'Hey, this is what we're doing for other FOPs in the state,'" Grimm said."Do you think their generosity was based on getting 10 machines, or that they just wanted to help the Princeton FOP?" Lottery Director John Musgrave asked.Grimm said Action Gaming executives proposed a number of location options for the lodge, complete with buildings available for lease. He said the FOP chose Harrisville because of a lack of competing video lottery locations in the area, and also because other locations proposed by Action Gaming were even farther from Princeton."There's other video lottery companies out there who would like the business, but they [Action Gaming] came to us," he told the commission.The Princeton FOP's treasurer, Timothy Gray, told commissioners the group saw video lottery as a way to support community programs, such as "Shop with a Cop" to buy Christmas presents for poor children, without having to solicit local residents and businesses for contributions.
"We wanted to get away from knocking on your door, or calling you up, saying, it's Shop with a Cop time, can you help us?" he said.While Lottery figures show that the FOP's share of gross profits from the video lottery location should have been $91,607 in 2013, the FOP officers said their group has lost money on the site for the past four months.Grimm said Action Gaming and the FOP split gross profits 50-50, but the FOP pays all payroll and expenses for operating the Harrisville lodge.As part of the agreement, Action Gaming loans the FOP money to cover months when they lose money on video lottery, Grimm said."We knew we were taking a chance with the lottery," he told commissioners. "We were told there are months when people hit big and you lose money."Grimm said members of the public who want to gamble at the Harrisville lodge have to get associate memberships in the FOP.
Musgrave said three "show-cause" hearings still to come will involve similar scenarios. Commissioners will meet after the hearings to determine possible actions against the organizations.Organizations that improperly obtained limited video lottery fraternal status could face fines of up to $10,000, reductions in the number of machines allowed and possible revocation of Lottery licenses.Reach Phil Kabler at firstname.lastname@example.org or 304-348-1220.