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Slots Proponents Take It to Court

By Lori Montgomery
Washington Post Staff Writer
Thursday, August 26, 2004; Page DZ02

Proponents of a plan to legalize slot machine gambling say the D.C. elections board violated their First Amendment right to free speech when it invalidated thousands of petition signatures collected by people trained to sell the gambling initiative as a harbinger of jobs, improved public schools and better health care.

In a 51-page pleading filed Friday with the D.C. Court of Appeals, slots supporters asked the court to reverse the election board's decision and order the board to place the gambling initiative on the Nov. 2 ballot.

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D.C. City Council

"There can be no legitimate dispute that, while Initiative 68 is primarily about gaming or 'slots,' it is also 'about' jobs, education and healthcare," the pleading states.

"The extent of those benefits, whether they are likely to materialize at all, and any other factors relating to the merits of the proposal are precisely the sort of things that should be the subject of debate in a political campaign. It is not the job of the Board or any other government agency to decide the issues that should be debated or the precise terms in which the arguments should be framed."

The Court of Appeals has set a hearing for Sept. 8 in the case, which will determine whether the gambling initiative may yet be placed before District voters. If approved, the initiative would authorize the installation of 3,500 slotmachines on a 14-acre site in Northeast Washington on New York Avenue and Bladensburg Road.

The chairman of the slots initiative, businessman Pedro Alfonso, has said the gambling hall would create more than 1,500 jobs and generate about $765 million a year in revenues. A quarter of that money would be given to city officials, who would be encouraged to use it for public education and to defray the costs of prescription drugs for the elderly.

Earlier this month, the D.C. Board of Elections and Ethics concluded that slots supporters had failed to obtain a sufficient number of signatures from D.C. voters to qualify for a spot on the ballot. Though slots proponents submitted more than 52,000 signatures -- three times the number needed -- the board found that a five-day petition drive in early July had been marred by such "monumental" flaws that the board was forced to invalidate thousands of those signatures.

The board was especially critical of a portion of the petition drive managed by Stars & Stripes USA, a Florida firm hired to train and manage petition circulators. After taking testimony during a nine-day public inquiry, the board concluded that a Stars & Stripes manager, Ross Williams, had "instructed circulators to rely on education and health care benefits of the Initiative in encouraging potential signers to sign the petition."

The board ruled that circulators, in violation of D.C. law, made "false statements" about the initiative. It also ruled that the Stars & Stripes operation had been "managed -- from the top -- in a manner that created an environment fraught with opportunities for abuse of process, system and laws."

With that, the board rejected all the petitions collected under Stars & Stripes' direction, causing the petition drive to fall 2,912 signatures short of its goal.

In his pleading on behalf of slots supporters, attorney George W. Jones Jr. argued that the board's ruling reaches far beyond its statutory authority to maintain the integrity of the election process and "severely burdens the First Amendment rights of the proponents of the initiative, the circulators and the voters of the District of Columbia . . .

"The record does not support any suggestion of knowingly false or misleading speech," Jones writes. "Nor is there any evidence that significant numbers of voters were misled by any supposed suggestion that the initiative 'guaranteed' jobs, better schools or improved health care. . . . On the contrary, the statements represent good-faith advocacy at the core of the political debate, which the First Amendment compels the government to permit voters to sort out."

Baseball Backers Assailed

A coalition of individuals and social service organizations that is opposed to public financing of a baseball stadium in D.C. is calling on the city to abandon its relationship with the Washington Baseball Club, a group of investors that hopes to buy the Montreal Expos if Major League Baseball moves the team to the District.

The coalition, which calls itself the No DC Taxes for Baseball Campaign, said the WBC is no longer a suitable partner in the quest for baseball because one of its founders, investment banker Frederic V. Malek, was recently fined by the Securities and Exchange Commission.

Malek was penalized for failing to disclose that his company, Thayer Capital Partners, had paid $374,500 to a politically connected consultant who helped the firm win a lucrative state pension fund investment deal in Connecticut. The consultant did "no meaningful work" to earn that fee, according to the SEC, which levied fines of $100,000 against Malek and $150,000 against Thayer Capital.

Neither Malek nor Mark Tuohey, chairman of the D.C. Sports and Entertainment Commission, returned calls to their offices.

Staff writer Thomas Heath contributed to this report.

© 2004 The Washington Post Company