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Legion gambling is a safe bet again

By Staff | Jun 23, 2013

It’s a pretty safe bet that the Blue Earth American Legion Post is going to continue operating its charitable gambling games.

But, just a few months ago, the odds were running about 50-50 that they would not be able to.

“We were being audited by the Minnesota Charitable Gambling Board,” says Gary Agren, the American Legion Post Commander. “And by the Minnesota Department of Revenue.”

The group was definitely in trouble. And, they might have had to shut down their two gambling games.

The problems arose from not filing the proper paperwork with the two state agencies in a timely manner.

For many years, the Legion had one of their members, Vern Schavey, as their gambling manager. Agren says Schavey did a fantastic job.

“There is a lot of work involved and a lot of training,” Agren says. “Everything has to be accounted for and there is a lot of recording and reporting that has to be done. It is a job that has to be tended to every day.”

After Schavey’s death, the Legion hired another gambling manager, and Agren says that person was simply overwhelmed with all the paperwork involved, and failed to file the forms on time.

“We don’t believe there was any intentional wrong doing or criminal activity,” Agren says.

But, three other members of the Legion had to quickly take the gambling manager classes and take over the operations.

“We are getting back on track,” Agren notes. “We have filed the forms with the gambling board and paid our $1,500 fine. And we are getting caught up with the Department of Revenue.”

And one more thing. They have hired a new gambling manager.

Gwen Hoehn began the duties as of June 1. The rules are that the gambling manager has to be a member of the Legion, and she is.

Unlike the gambling manager job, the manager of the Legion Club operation itself (the bar, food service, etc.) does not have to be a Legion member. Vickie Johnson remains in that position.

There are five types of allowable charitable gambling games in Minnesota raffles, bingo, pull-tabs, tip boards and paddlewheels. All require a license from the state gambling board.

The Blue Earth Legion Post is involved in two of those pull-tabs and tip boards.

“We are still using the paper pull-tabs,” Agren says. “We have no interest here in the new electronic pull-tabs.”

The Legion runs five different pull-tab games. All involve peeling back tabs to see if three images match and if they do, there is a cash prize.

Tip boards have 30 numbers on them and it costs $1 per number to get on the board. The prize is a meat item.

The Legion runs tip boards on Friday afternoons during Happy Hour.

“We used to run bingo at the Legion,” Agren says. “And we are thinking of getting back into that game again, as well.”

Because these are charitable games, the state decrees that a portion of the profits go to charity.

In the Blue Earth area, that translates to the Legion donating to a lot of worthy groups and organizations.

In fact, in 2012, the Legion donated $22,669 to 18 different causes.

“We are mandated to give at least 30 percent of our profits back into the community,” Agren says. “But, we would like to ideally give about 50 percent of the profits back.”

That would be after all “allowable expenses” are paid, for items such as the cost of the games themselves, prizes, manager’s salary, taxes, etc.

There is also a small city license fee.

The Blue Earth City Council has considered imposing a gambling tax instead of a license fee. They are allowed to charge a charitable gambling operation up to a 3-percent tax.

However, at a recent council meeting, it was decided to not include a tax in a new gambling ordinance that is being drafted by the city.

“I think it is a better deal to let the Legion operate the gambling and put their proceeds back into the community through donations,” Mayor Rick Scholtes said.

In 2012, the Legion made the following donations:

Color guard/firing squad $5,120;

BEA High School scholarships $4,000;

Veterans Pheasant Dinners $3,324;

Legion/youth baseball $2,458;

BEA High School top boy/girl $1,500;

BE Fire Department Relief Association $1,500;

BEA High School Washington trip $1,200;

Relay for Life $1,000;

Boys/Girls State $787;

BEA Foundation $500;

BEA High School Post Prom $250;

BEA High School Peer Helping $250;

Lions/Kiwanis Banquet tickets $180;

Faribault County 4-H $150;

Veterans organizations $150;

Hospice $100;

BE United Fund $100;

Little Giants $100.

In addition, Agren says the American Legion supported local Boy and Girl Scouts, American Education Week, provided a Veterans Day lunch for the community, put on programs for Veterans Day and Memorial Day and provided a meeting place for many activities.