STATE OF MICHIGAN
MICHIGAN GAMING CONTROL BOARD
PUBLIC MEETING

Cadillac Place
3062 W. Grand Blvd., Suite L-700
Detroit, Michigan

Thursday, May 7, 2009

9:30 a.m.
 

MINUTES

 

On Thursday, May 7, 2009, the Michigan Gaming Control Board held a public meeting at the Board office in theCadillac Place, 3062 W. Grand Boulevard, Suite L-700, Detroit, Michigan.

Present:                     In attendance were the following Board members:

                                                         Mr. Damian Kassab, Chairman
                                                          Judge Benjamin Friedman
                                                         Ms. Barbara Rom
                                                         Mr. Michael Watza

                                   Also attending were:

                                                         Richard Kalm
                                                         Fred Cleland
                                                         Thomas Barker
                                                         D/F Lt. Vicki Johnson
                                                         Donald McGehee
                                                         Laurie Lander
                                                         Diane Brown

Business:

Board Chairman Damian Kassab called the staff briefing of the public meeting to order at 9:35 a.m.

Chairman Kassab stated that the first order of business was to approve the minutes from the April 20, 2009, regular public meeting.  Chairman Kassab noted that all Board members had previously received the minutes, and asked if there were any questions or concerns.

It was then moved by Ms. Rom and seconded by Judge Friedman that the minutes of the April 20, 2009, meeting be approved.  A voice vote was taken.

Motion carried.

Next Mr. Kalm presented the Executive Director's report.  Mr. Kalm reported that since the last Board meeting, Regulation Officer Margie McNutt retired and Regulation Officer LaTonya Morgan had been transferred from the Compliance Section to the Investigation Section in the Licensing Division.  Also, Sophia Sanders had been promoted to Supervisor and Diane Brown had been promoted to the Executive Director's SEMA position, leaving 18 authorized positions to be filled.

In regards to the Board's budget, Mr. Kalm reported that as of April 30, 2009, total expenditures were $9,520,738, which leaves an unexpended balance of $11,222,762 in appropriated funding for fiscal year 2009.   These funds include anticipated expenditures by the Attorney General's Office and the Michigan State Police.

Mr. Kalm next reported that the casinos continue to operate 24/7 and for the month of April 2009, the aggregate revenue and taxes for all 3 Detroit casinos were down by 4.1% compared to the same month last year.  Revenue for MGM Grand Detroit and MotorCity Casinos were down by 5.58% and 5.32% respectively, while Greektown Casino was up by 0.6% compared to the same month last year.

For the month ending April 30, 2009, gaming taxes for the 3 Detroit casinos were 10.165 Million compared to 9.24 Million for the same period last year.

In regards to supplier licensing and vendor registration, Mr. Kalm advised the Board that as of April 30, 2009, 3,210 active vendor exemptions are registered, 219 casino supplier companies have been granted exemptions from supplier licensing requirements, and 60 active temporary nongaming-related supplier licenses and 7 active temporary gaming-related supplier licenses are in effect.  In addition, a total of 129 full annual supplier licenses have been granted by the Board and to date, remain in effect.

In regards to employee licensing, Mr. Kalm advised the Board that as of April 30, 2009, the Board's Employee Licensing Section had issued a total of 2,657 valid occupational licenses to MGM Grand Detroit Casino employees; 1,888 valid occupational licenses to MotorCity Casino employees; and 1,693 valid occupational licenses to Greektown Casino employees.  To date, the Board has authorized the issuance of 16,095 occupational licenses to casino and supplier license employees; renewed 15,358 occupational licenses and denied 390 occupational license applications and denied 2 occupational renewal license applications.

Mr. Kalm advised the Board that the required background investigations for 56 pending Level 1 and 2 licenses had been completed and would be considered for approval by the Board at today's meeting and pursuant to Board Resolution No. 2002-02 he has approved the 250 renewal requests on behalf of the Board.

Next Mr. Kalm reported on the MSP Board related activity for the month of April 2009.  Mr. Kalm reported that there had been no staffing changes, still leaving 1 D/Specialist position vacant which has been authorized to fill and has been posted.  Also, during the month of April 2009, the MSP Gaming Section investigated 50 criminal complaints and made 16 arrests.  Mr. Kalm further stated that 7 of the complaints investigated and 6 of the arrests made were of Disassociated Persons.

Next the Board considered for approval the recommendations of the Executive Director and the Licensing Division's staff regarding the 56 level 1 and 2 occupational license applications.

Therefore, It was moved by Ms. Rom and seconded by Judge Friedman to accept the recommendations of the Executive Director and the Licensing Division's staff for the 56 Level 1 and 2 occupational license applications.  A voice vote was taken.

Motion carried.

Next the Board considered the Executive Director's Reports and Licensing Division's staff recommendations regarding the transfers of interest in Altronic Americas, L.L.C. and Spielo Manufacturing, U.L.C.

There being no questions from Board members, it was moved by Mr. Watza and seconded by Judge Friedman that the Board enter orders approving the transfers of interest in Altronic Americas, L.L.C., with a transfer of 100% ownership from GTECH to Lottomatica and Spielo Manufacturing U.L.C, with a transfer of 100% ownership from GTECH to Lottomatica. 

A voice vote was taken.

Motion carried.

Next the Board considered the Executive Director's Reports and Licensing Division's staff recommendations regarding the pending supplier license renewal applications of American Gaming Electronics, Inc., Detroit Spectrum Painters, Inc., Diversified Computer Services, Inc., Gardner Signs, Inc., Goldstar Equipment, Inc., Mueller Custom Cabinetry, Inc., National Millwork, Inc., VSR Industries, Inc., and W.H. Cannon, Inc.

Chairman Kassab recused himself from the vote on Detroit Spectrum Painters, Inc. and Judge Friedman recused himself from the vote on Goldstar Equipment, Inc.  Chairman Kassab requested 3 separate motions and votes.

Therefore, it was moved by Mr. Watza and seconded by Ms. Rom that the Board enter orders finding and concluding that American Gaming Electronics, Inc., Diversified Computer Services, Inc., Gardner Signs, Inc., Mueller Custom Cabinetry, Inc., National Millwork, Inc., VSR Industries, Inc., and W.H. Cannon, Inc., and their qualifiers are eligible and suitable for licensure under the licensing standards and requirements of the Act and Rules of the Board and accordingly, grant these requests for a one-year period beginning May 7, 2009.

Next it was moved by Ms. Rom and seconded by Mr. Watza that the Board enter an order finding and concluding that Detroit Spectrum Painters, Inc. and its qualifiers are eligible and suitable for licensure under the licensing standards and requirements of the Act and Rules of the Board and accordingly, granting this request for a one-year period beginning May 7, 2009.  A voice vote was taken.

Motion carried.

Next it was moved by Mr. Watza and seconded by Ms. Rom that the Board enter an order finding and concluding that Goldstar Equipment, Inc. and its qualifiers are eligible and suitable for licensure under the licensing standards and requirements of the Act and Rules of the Board and accordingly, granting this request for a one-year period beginning May 7, 2009.  A voice vote was taken.

Motion carried.

The Board next considered the Executive Director's Report and Licensing Division's staff recommendation regarding the request to withdrawal the pending supplier license application of W.J. O'Neil Company.

There being no questions from Board members, it was moved by Judge Friedman and seconded by Ms. Rom that the Board enter an order granting the request of  W.J. O'Neil Company for withdrawal of  its supplier license application, based upon the Board staff's report and recommendation.  A voice vote was taken.

Motion carried.

Upon Chairman Kassab's request Mr. Chuck Moore of Conway MacKenzie & Dunleavy, financial advisors for Greektown Casino, gave a status report pursuant to the Board's June 10, 2008 show cause order.

Mr. Moore provided an update to the bankruptcy court proceedings, financial status, exit paths, development agreement compliance with the City of Detroit and casino management board operations.

In response to Chairman Kassab's question, Mr. Weiner advised that the Judge will rule on the debtor's assumption of the revised Development Agreement and possibly a breach/default of contract by May 14, 2009.  Mr. Moore also advised the Board that all payments to contractors were up to date.

After Board members' questions were answered regarding the increase of revenues, bankruptcy costs, 2005 covenants and the hotel's profitability, Chairman Kassab requested a change in closing procedures.

Chairman Kassab stated that the Board would not adjourn the meeting at this time, but would go into close session.  Upon the conclusion of the closed session, the Board would return and adjourn the meeting.

Therefore, it was moved by Mr. Watza and seconded by Judge Friedman, that the Board recess and go into closed session for the purpose of receiving legal advice and counsel from the Board's attorney regarding pending Board litigation, and receiving confidential notification regarding the names of the individuals placed on the Board's Dissociated Persons List since the Board's last public meeting as required by the Act.

A roll call vote was taken.

                                              Chairman Kassab:                   Aye
                                               Judge Friedman:                     Aye
                                              Ms. Rom:                               Aye
                                              Mr. Watza                              Aye

Motion Carried.

Next, Chairman Kassab announced that the Board's next regular public meeting will be June 9, 2009, at 9:30 a.m.

There being no public comments, Chairman Kassab adjourned the meeting at 10:47 a.m.

____________________________
Diane Brown, Board Secretary