STATE OF MICHIGAN

MICHIGAN GAMING CONTROL BOARD

PUBLIC MEETING

Cadillac Place

3062 W. Grand Blvd., Suite L-700

Detroit, Michigan

TUESDAY, August 10, 2004

11:00 A.M.

MINUTES

On Tuesday, August 10, 2004, the Michigan Gaming Control Board held a public meeting at the Board office in the Cadillac Place, 3062 W. Grand Blvd, Suite L-700, Detroit, Michigan.

Present:                        In attendance were the following Board members:

                                                Damian Kassab, Chairman

                                                Donald Robinson

                                                Barbara Rom

                                                Judge Michael Stacey

                        Also attending were:

                                                Daniel Gustafson

                                                Patty James

                                                Insp. Ellis Stafford

                                                Ben McMakin

                                                Tom Barker

                                                John Page

                                                Jack Cahill

                                                Bethany Scheib

Business:        Board Chairman Damian Kassab called the meeting to order at 11:18 a.m.  Chairman Kassab noted for the record that Judge Friedman was not present at the meeting due to a prior commitment.

                        Chairman Kassab stated the first order of business was to approve the minutes from the June 8, 2004 meeting.  He requested a motion to approve the minutes from the June 8, 2004 meeting.

                        It was moved and seconded that the minutes of the June 8, 2004 meeting be approved.  Motion carried.

                        Dan Gustafson next presented the Executive Director’s report.  In regards to staffing Mr. Gustafson advised the Board that James Day, Lilly Jenkins and Erik Pedersen were hired as auditors in the Board's Audit Section.  The Board also hired Michael Maher as a Compliance Manager in the Enforcement Division.   Mr. Gustafson further advised the Board that the MGCB staff now total 98 with 4 authorized positions yet to be filled.  He also noted that the Board is in the process of filling these 4 positions.

                        Mr. Gustafson next presented a Certificate of Appreciation to Dan Fields.  Mr. Gustafson advised the Board that Mr. Fields has been a Board employee since 1999 and was now retiring.

                        Mr. Gustafson proceeded to give an update regarding the Board’s budget.  Mr. Gustafson reported that for the fiscal year 2004, from October 1, 2003 through July 31, 2004, the Board has incurred expenditures in the amount of $10,777.831, leaving the unexpended balance of $6,555,369 in appropriated funding for FY 2004.   Mr. Gustafson further advised that the unexpended balance includes year-end reimbursements to the Attorney General and State Police.

                        Mr. Gustafson next reported that the aggregate revenue in taxes for all three Detroit casinos was up 8.57 percent compared to the same month last year.   The gaming taxes for the three Detroit casinos for July 2004 were $8.35 million compared to $7.69 million for the same period last year.

                        Mr. Gustafson then proceeded to update the Board on the status of the issuance of temporary supplier licenses, full supplier licenses, vendor registrations, and supplier licensing exemptions, as well as the status of the issuance of temporary and permanent occupational licenses for the three casinos.

                        Upon conclusion of Mr. Gustafson’s report Chairman Kassab requested a motion to accept the recommendations of the Executive Director regarding the 163 Level 1 and 2 occupational license applications.

                        It was moved by Ms. Rom and seconded by Judge Stacey to accept the recommendations of the Executive Director for the applications summarized in Exhibit 1.  A voice roll call was taken.

                        Motion carried.

The Board next considered Board Resolution No. 2004-04 to provide criteria on which supplier license applicants who have made political contributions may have the option to withdraw an application and reapply under certain conditions.

Mr. Gustafson invited Assistant Attorney General in Charge, Jack Cahill to present the resolution to the Board.

Upon conclusion of Mr. Cahill's briefing and questions from Board members, it was moved by Judge Stacey and seconded by Ms. Rom to adopt the proposed Board Resolution No. 2004-04 to provide criteria on which supplier license applicants who have made political contributions may have an option to withdraw application and reapply under certain conditions.  The following roll call vote was taken:

            Chairman Kassab:            Aye

            Mr. Robinson:                        Aye

            Ms. Rom:                        Aye

            Judge Stacey:                        Aye

                        Motion carried.

                        The Board next considered the Board's acceptance of acknowledgement of violation of Aristocrat Technologies. 

                        Mr. Cahill gave a brief summary of the violation and Mr. John Page, Deputy Director of Enforcement, answered Board members' questions. 

                        It was noted for the record that Mr. Robert Stocker, counsel for Aristocrat Technologies and Mr. Walt Stowe, VP of Legal and Compliance for Aristocrat Technology were present at the meeting.

                        After brief comments from Mr. Stocker, Mr. Stowe and Mr. Page, it was moved by Ms. Rom and seconded by Mr. Robinson that the Board adopt the acknowledgment of violation and the proposed resolution of that violation and stipulated sanction.  A voice roll call vote was taken.

                        Motion carried.

                        The next agenda item was to consider the Executive Director Reports and the Licensing Division's recommendations regarding the pending gaming related supplier license applications of LaBelle Electric Services, Inc., American Gaming and Electronics, Inc. and Hop Bet, Inc.

                        Chairman Kassab requested a brief summary on each license application from Mr. McMakin.

                        Upon conclusion of Mr. McMakin's summary and questions from Board members it was moved by Judge Stacey and seconded by Ms. Rom that the Board find and conclude that LaBelle Electric Services, Inc., American Gaming and Electronics, Inc. and Hop Bet, Inc., and their qualifiers are eligible and suitable for licensure.  A voice roll call was taken.

                        Motion carried.

                        The Board next considered the Executive Director's report and the Licensing Division's recommendation regarding the pending non-gaming related supplier license application of Women's Economic Empowerment Group, Inc.

                        Chairman Kassab noted for the record that there were no representatives for the applicant present at the meeting and requested Mr. McMakin to present the investigative facts to the Board.

                        After a brief discussion between Mr. McMakin and Board members, it was moved by Judge Stacey and seconded by Ms. Rom to find and conclude that Women's Economic Empowerment Group, Inc. and its qualifiers are eligible and suitable for licensure.  A voice roll call was taken.

                        Motion carried.

                        The next agenda item considered was the Executive Director's report and the Licensing Division's recommendation for denial regarding the pending non-gaming related supplier license application of New Center Hauling and Recycling, Inc.

                        After noting for the record that there were no representatives for New Center Hauling and Recycling, Inc. present at the meeting, it was moved by Ms. Rom and seconded by Judge Stacey that the Board deny the applicant's request for a non-gaming related supplier license.  A voice roll call was taken.

                        Motion carried.

                        The Board next considered the Proposal for Decision in the matter of the denial of VJT Restaurant, Inc.'s application for a supplier license.

                        Chairman Kassab noted for the record the presence of Mr. James T. Hogan, counsel for the applicant. 

                        Mr. Hogan advised the Board that his client has made application for an exemption pursuant to Board Resolution 2003-07 and requested that this matter be adjourned until the next Board meeting. 

                        After Ms. Scheib presented objections to the request for adjournment, it was moved by Mr. Robinson and seconded by Judge Stacey to accept, adopt and incorporate the hearing officer's Proposal for Decision in its entirety and deny VJT Restaurant, Inc.'s application for a supplier license.   A voice roll call vote was taken.

                        Motion carried.

                        Mr. Hogan then requested that the Board stay its decision on this matter pending completion of the exemption request.

                        After comments from Ms. Scheib, it was moved by Judge Stacey and seconded by Mr. Robinson that the applicant's request for an adjournment and stay be denied.  A voice roll call was taken.

                        Motion carried.

                        The Board next considered the denial of Michael Gerych's application for an occupational license.

                        Chairman Kassab noted for the record the presence of Mr. James Shimoura, counsel for the applicant.

                        After comments from Mr. Shimoura and Ms. Scheib, it was moved by Judge Stacey and seconded by Ms. Rom that the Board confirm the denial of Mr. Gerych's application for an occupational license and grant the one-year waiver request.  A voice roll call was taken.

                        Motion carried.

                        The next agenda item considered by the Board was consideration of the Proposal for Decision in the matter of the denial of Kimberly Cole's application for an occupational license.

                        It was noted for the record that neither Ms. Cole nor her representative were present at the meeting.

                        After a few brief comments from Ms. Scheib, it was moved by Ms. Rom and seconded by Judge Stacey that the Board accept, adopt and incorporate the hearing officer's Proposal for Decision in the matter and deny Ms. Cole's application for an occupational license and grant the one-year waiver request.  A voice roll call was taken.

                        Motion carried.

                        The Board next considered the Proposal for Decision in the matter of the summary suspension of the occupational license for Robert J. Aaron.

                        Chairman Kassab noted for the record that Mr. Aaron was present at the meeting.

                        After comments from Mr. Aaron, Ms. Scheib, Mr. Cahill and questions from Board members, it was moved by Judge Stacey and seconded by Mr. Robinson that the Board enter a final decision and order in the matter of the summary suspension of occupational licensee Robert J. Aaron, accepting, adopting and incorporating the hearing officer's Proposal for Decision in the matter in its entirety and revoking Robert J. Aaron's occupational license.  The following roll call vote was then taken on the motion:

                                    Chairman Kassab:            Nay

                                    Mr. Robinson:            Aye

                                    Ms. Rom:            Nay

                                    Judge Stacey:            Aye

                        Due to a voting deadlock it was moved by Ms. Rom and seconded by Mr. Robinson that this matter be adjourned until the September 14, 2004 Board meeting.  The following roll call vote was taken:

                                    Chairman Kassab:            Aye

                                    Mr. Robinson:            Aye

                                    Ms. Rom:            Aye

                                    Judge Stacey:            Nay

                        Motion carried.

                        The Board next considered the stipulations to vacate denial of licenses to Jenkins Construction, Inc. and Miller Parking Company.

                        It was noted for the record that Mr. Scott Sirich, counsel for Jenkins Construction, Inc. was present at the meeting.

                        After comments from Mr. Sirich and Ms. Scheib, it was moved by Judge Stacey and seconded by Ms. Rom that the Board approve the stipulations to vacate denial of licenses to Jenkins Construction, Inc. and Miller Parking Company.  A voice roll call vote was taken.

                        Motion carried.

                        Mr. Sirich then requested that the Board grant a waiver of the one-year waiting period and allow Jenkins Construction, Inc. to withdraw its application and immediately reapply for its supplier license.

                        Therefore, it was moved by Judge Stacey and seconded by Mr. Robinson that the Board grant the waiver of the one-year requirement and deny waiving the reapplication fees.  A voice roll call was taken.

                        Motion carried.

                        The final agenda item to be considered was the matter of the denials of the pending supplier license applications for LaBelle Communications, Inc. and Lavdas Enterprises, Inc.

                        Chairman Kassab noted for the record that Mr. Ed Boucher, counsel for LaBelle Communications, Inc. and Mr. Len Wolfe, counsel for Lavdas Enterprises, Inc. were present at the meeting.

                        Next Chairman Kassab requested that Ms. Scheib give an overview of the cases.

                        Upon completion of Ms. Scheib's overview it was moved by Mr. Robinson and seconded by Ms. Rom that the Board accept, adopt and incorporate the hearing officer's Proposals for Decision in the matter of the denial of LaBelle Communications, Inc.'s and Lavdas Enterprises, Inc.'s application for a supplier license and vacate the notices of denial and board orders.  A voice roll call vote was taken.

                        Motion carried. 

                        There being no other license applications to consider, it was moved by Mr. Robinson and seconded by Ms. Rom that the Board go into closed session immediately following the conclusion of the public meeting for the purpose of receiving legal advice and counsel from the Board’s attorney regarding pending Board litigation, and receiving confidential notification from the Executive Director regarding the names of individuals placed on the Board’s Disassociated Persons List since the Board’s last public meeting as required by the Act.  A voice roll call was taken.

                        Motion carried.

For the public comment portion of the meeting, Chairman Kassab noted for the record the presence of Mr. Leon Paesani.

After Mr. Paesani's comments, Chairman Kassab adjourned the meeting, at 1:15 p.m.

                              ______

                                Patricia S. James

                                Board Secretary