Rancor is rising and mud is flying, but a mess is normal when it comes to gambling in Alabama. The fight ties the reprobate to the religious, the crusader to the criminal and hardens an already cynical public. The imbroglio between gaming kingpins and public servants is merely the latest chapter in a historic tale fraught with corruption, favor and murder.
Early days
When times were dire, Alabama had no problem nestling up to sin. According to a medscape.com examination of the pathology and history of Southern gambling, the Heart of Dixie implemented a lottery in the years following the Civil War to finance public projects. Such efforts were common throughout the devastated former Confederacy.
The largest of these operations was the Louisiana State Lottery, born from Act 25 of the1868 Louisiana State Legislature granting the Louisiana State Lottery Company a 25-year monopoly and a $40,000 tax exemption. A decade later, Louisiana State Lottery Company tickets had spread nationwide.
Understandably, competing interests in neighboring states tagged the lottery “The Serpent.” Owing to its proximity to the Bayou State and its status as Alabama’s most sizable city, Mobile became a target for lottery tickets and money flowed westward from the Azalea City. So in 1878, legislation in Montgomery prohibited the sales of Louisiana Lottery tickets in Alabama. Other regional states followed suit and in 1879 the lottery charter was withdrawn.
Though Louisiana lottery officials managed to have the charter renewed within years, anti-gambling forces in the Heart of Dixie gained a potent foothold. In the decades following, popular sentiment fell in line with the pulpit.
Alabama’s laborious and notorious 1901 state constitution prohibited games of chance and still cite it as legal only through additional amendments. The legislature also passed provisions to the state criminal code then that made gambling a crime.
Sin City
The most nefariously bloody chapter of the state’s gaming history unfolded in the mid-20th century on the banks of the Chattahoochee River separating Alabama from Georgia. Traditionally a mill town, Russell County’s Phenix City, Ala., needed an economic boost when the municipality went bankrupt during the Great Depression with more than $1.1 million in debt and by 1933 had moved into federal receivership.
City leaders opted to turn vice to their advantage and enacted a series of fines and licenses over gambling and the use and sale of liquor, regardless of state law. The town revenue increased — $228,000 a year in 1945 — but gambling was still illegal as far as the powers in Montgomery were concerned.
With Ft. Benning over the river in Columbus, Ga., gaming and prostitution was stoked by the 100,000 men stationed at the base who were eager to leave their inhibitions behind in the barracks.
In the midst of belt-tightening World War II, Phenix City improved its police force and built its first fire department. By 1948, they had their first hospital.
Predictably, organized crime moved in and began to run gambling, narcotics and prostitution in town. That control also crept into city hall as racketeers rigged local and state elections and held leadership positions in the chamber of commerce, on school boards, hospital boards and in service organizations. Some also boasted membership in the Ku Klux Klan.
Some citizens fought back when local businessman and crusader Hugh Bentley formed the anti-crime group the Russell Betterment Association (RBA). The bombing of Bentley’s home brought unwanted attention and saddled the border town with an infamous reputation.
Attorney Albert Patterson had seen enough. He had moved his family to Phenix City in the 1930s and worked his way up the political chain, first on the local school board, then in the state senate. Following the explosion, Patterson decided to join forces with RBA. Realizing the power to clean up the city would have to come from Montgomery, the RBA in turn backed a Patterson bid for state attorney general.
Though underworld forces attempted election tampering, Patterson won the Democratic primary, tantamount to winning the general election in the political scene of the day. It seemed a new era was set to dawn.
Ten days after securing the nomination, Patterson was shot three times, assassinated outside his law office on June18, 1954.
Phenix City Mayor Homer Cobb’s response was swift. He ordered all businesses selling alcohol closed on Sundays. Alabama Gov. Gordon Persons placed the town under martial law and sent in the National Guard. Ft. Benning declared the town off limits to personnel, as guardsmen conducted round-the-clock raids on nightclubs, warehouses and gambling dens.
Patterson’s son John, also an attorney, was tapped to carry the mantle forward in the 1955 election. He went on to prosecute those indicted for his father’s murder, winning one conviction and eventually ascending to the governor’s office.
Tweaking the law
In 1971, pari-mutuel wagering at dog and horse tracks was found constitutional by the Alabama Supreme Court. Justices ruled that while Section 65 of the constitution prevents the legislature from authorizing a lottery, it does not prevent gambling that doesn’t constitute a pure game of chance. Therefore, the degree of skill involved in dog and horse racing made it legal.
It wouldn’t take long before a quartet of dog tracks were operating around the state. Milton McGregor built two, one near Birmingham and one east of Montgomery in Shorter. Mobile’s dog track, owned by a group of familiar and powerful names like Maisel, opened southeast of town near Theodore.
Greenetrack in Eutaw was opened in 1978 and eventually earned a national reputation as a “killing fields” track before animal rights groups removed injured greyhounds from its kennels in 1998. Chief investor Paul Bryant, Jr., son of legendary Alabama football coach and demigod “Bear” Bryant, withdrew from the operation then and moved his money to a Texas track.
In 1980, an amendment to the constitution made Jefferson County the first county to authorize limited charitable bingo. Since then, 18 additional amendments have permitted bingo in various counties and cities. The Indian Gaming Regulatory Act of 1988 gave the green light to casinos on Alabama’s Indian lands.
Despite protestations that the act violated the 11th Amendment of the U.S. Constitution limiting federal judicial power over states, money flowed onto the reservations.
Coziness between elected officials and gambling interests is common. In 1993, Mobile Mayor Mike Dow led the formation of Jobs for Alabamians Coalition (JACO), a PAC to get the Alabama Legislature to pass a constitutional amendment for a statewide lottery and casinos in downtown Mobile, Prichard and at the state’s four dog tracks.
Then-Mobile City Attorney John Lockett — former Gov. Don Siegelman’s one-time law partner — defended Dow’s association with JACO to the press, saying it was no different than him being a member of the League of Municipalities. Joining Dow in JACO were the mayors of Birmingham and Tuskegee and racing baron Milton McGregor. Lockett currently sits on the bench of the 13th Judicial Circuit Court.
According to McGregor, gubernatorial candidate and former state GOP chair Winton Blount III arranged a 1993 meeting with McGregor and a pair of long-time personal friends, buddies who were also top casino executives with Promos, an entity seeking expansion into Alabama. McGregor told former Press-Register reporter Cathy Donaldson that Blount attended part of the meeting and talked about casino benefits. When the politico later denied the meeting, Donaldson said the gambling king called Blount “a hypocrite” In the early 1990s, former Gov. Jim Folsom, Jr. was pilloried when it was revealed he flew to the Cayman Islands in McGregor’s private airplane. “I was run over by the church bus,” Folsom said publicly after losing the 1994 gubernatorial election.
Folsom’s allegations about influence are not without merit, as religion has long been the stalwart opposition to any gambling propositions. The Alabama Baptist Convention remains on record with formal resistance to all efforts. The state’s churches remain a formidable political force as evidenced by the fact that more than a third of Alabama’s counties — 26 of 67 – remain dry. However, 12 of those dry counties contain municipalities with some legal alcohol sales within city limits.
In 1998, Mobilian Don Siegelman won the gubernatorial election by promising to bring a referendum before the people, an effort to allow a state lottery that would ostensibly fund educational efforts. Simultaneously making the rounds on Goat Hill was a bill to allow video poker and blackjack at the state’s dog tracks.
“People better wake up and start asking some questions. I think it was a joint effort with the gambling interests and the governor’s office working together,” State Rep. Steve McMillan of Bay Minette told media. “We even had legislators saying that if the video poker didn’t pass, they would not support the lottery.”
The Siegelman lottery attempt failed.
According to a 1999 article published by the now-defunct Harbinger newspaper, Mobile attorney Richard Dorman has been a friend of Siegelman’s since the former governor’s college days and was chair of the Alabama Education Lottery Foundation, a PAC founded with intentions of funding the Siegelman lottery attempt. Dorman reportedly had a prior history with gambling as he once represented two entities involved with tribal gambling efforts near Atmore.
In 2003, an amendment allowed electronic bingo at Macon County’s VictoryLand racetrack, opening doors and elevating the furor.
In 2004, the state’s highest court rendered an opinion on the future of bingo. In Ex Parte Ted’s Game Enterprises v. Ted’s Game Enterprises (893 So.2d 376) the Alabama Supreme Court held that if chance is the dominant factor, an electronic game is prohibited. The court also noted the broad prohibition of such games throughout state history, and specifically noted bingo needed exemption by additional constitutional amendments.
Gov. Bob Riley was tenuously linked with regional gambling interests in 2005 when his former Congressional press secretary Michael Scanlon pled guilty to conspiracy in the Jack Abramoff scandal. It was revealed that Riley signed a letter opposing Alabama gambling on behalf of the U.S. Family Network, an Abramoff front tied with competing Indian gaming in neighboring Mississippi. Riley denied knowledge of the association.
A 2002 U.S. Senate Indian Affairs Committee report said Abramoff told William Worfel of Louisiana’s Coushatta Tribe that Mississippi Choctaw Chief Phillip Martin gave $13 million to Riley’s 2002 campaign in order to protect Choctaw gaming. The report also said Scanlon received $4.5 million over two years to protect the Choctaw’s gaming interests through a scheme known as “Operation Orange.”
In 2007, Lagniappe outlined ties between McGregor and Alabama State Attorney General Troy King, who received almost $65,000 in campaign donations from PACs affiliated with McGregor. The story included allusions from figures such as attorney Julian McPhillips that King was aware of McGregor’s power and made decisions accordingly.
“I’m not saying McGregor put King up to anything,” McPhillips stated, “I just think King’s trying to curry favor.” McPhillips also alluded to King’s prosecution of gaming facilities and individuals in White Hall, Ala. as being motivated by McGregor’s influence.
The Alabama Department of Revenue filed tax liens against Greenetrack in 2009 saying their electronic bingo hall owes more than $72 million in unpaid taxes.
Then, lawsuits filed by individuals in the fall of 2009 claim Greenetrack authorities rigged electronic bingo machines to pay out $20,000 to former Birmingham Mayor Larry Langford. A similar suit claims Langford received the same “benefit” at McGregor’s VictoryLand track outside Montgomery.
Langford attorney Michael Rasmussen dismissed the claims. “Those machines aren’t owned by local companies,” Rasmussen told media. “They’re operated by these national companies, and it would take something like the (federal National Security Agency) to break in and manipulate them.”
It was the least of Langford’s troubles. On Oct. 28, 2009, the mayor was convicted in federal court of 60 counts revolving conspiracy, bribery, fraud, money laundering and tax evasion. He faces up to 805 years in prison when he is sentenced March 5.
Even now, the marriage between seemingly competing ideologies continues. An Associated Press report from early February of 2010 revealed that gambling interests used political action committees to donate thousands of dollars to the Christian Coalition of Alabama, a traditional gaming opponent.
Race PAC finance reports show not only $8,000 in funds donated to the Christian Coalition last year, but the collection of money from gambling interests and other PACs funded by gambling interests. A similar group, Watch PAC, received funds from gambling interests and also reported $4,500 in contributions to the Christian group during the same period. The coalition previously received funds from groups tied with Mississippi Indian tribes that operate casinos.
Coalition Chairman Randy Brinson of Montgomery claimed the funds were unsolicited and that the use of PACs hid the money’s origin. “In fact, to ensure that this is not an issue in the future, we will no longer accept any contributions from any PAC for any purpose,” Brinson told media.
Yet two days before the donations story broke, Brinson held a conference criticizing Gov. Riley’s efforts to shut down Alabama casinos. A spokesman for the governor noted the coalition’s extreme reversal of positions on the gambling issue.
Within the last months, Gov. Riley has increased efforts to shut down the electronic bingo facilities across the state, claiming they violate the letter of the law. It has set him in direct opposition to McGregor and resulted in the magnate and others closing facilities around the state. Only Greenetrack is open at the time of this article.
In retaliation, McGregor has spearheaded an effort to have the legalization of gambling brought before voters.
Country Crossing Casino developer Ronnie Gilley flatly told the Montgomery Advertiser he believes the recent crackdown is rooted in neighboring states and competing interests, pointing to the Choctaw money that allegedly flowed into Riley coffers.
David Barber, the head of Riley’s newly minted Illegal Gambling Task Force resigned in January 2010 after winning $2,300 while gambling at a Choctaw casino in Mississippi. Riley appointed Mobile County District Attorney John Tyson to replace him and Tyson has steamed ahead with new vigor in the governor’s quest. Coincidentally, Tyson is a former King political rival, having lost the 2006 general election for state attorney general to the incumbent.
A legislative bill introduced Feb. 5, 2010 – The Alabama Bingo Control Act (ABC Act, SB 381) sponsored by Sen. Marc Keahy (D-Grove Hill) – would answer McGregor’s pleas. Were it to pass, it would not only allow gaming in 10 “tourist destinations” around the state, but would take the unprecedented move of establishing a state gaming commission to oversee operations. Gaming operators would be taxed at 28 percent of their gross receipts while vendors would be taxed 20 percent of gross. A Senate committee approved the measure 6-2 less than a week later.
On Feb. 17, Attorney General King held a press conference announcing his opinion that he and not the governor had direct authority over the task force but said he will decline from such for the time being. He instead suggested cessation of the raids on casinos and further clarification from the state supreme court before an eventual public referendum, effectively echoing McGregor’s cause.
Tyson responded with intent to oppose intervention from the former political rival.
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