"What's black and white and read all over?"

Monday, March 24, 2008
Posted 5:38 PM by

Pressure building in Slotsylvania House for DeNaples probe

Tad Decker (left), State Police Commissioner Jeffrey Miller
"It seems like we're not getting the truth here," state Rep. Curt Schroder (R-East Brandywine) told the Daily Local News of Chester County last week.

That's why Shroder and other Republican lawmakers are throwing in behind House Resolution 652. It reportedly calls for creating a select committee with subpoena powers to to examine the process that awarded a state license to indicted slots parlor owner Louis DeNaples.

I'd love to link directly to the resolution and tell you all about it.

But in typical Slotsylvania fashion, HR 652 still isn't posted online for the public to read. It isn't among a list of pending resolutions even though 12 others have been added since it was introduced last week.

That isn't what's supposed to happen when something controversial gets introduced in the Legislature. Just look at this example, which also happens to reference a fictional House Bill 652.

If passed by the House, HR 652 would reportedly create a select committee composed of 10 members, including the majority and minority chairs of the Gaming Oversight Committee, two appointments each from the majority and minority leaders, and four appointments by the speaker - two Republicans and two Democrats.

The committee would hold hearings, take testimony and issue subpoenas to compel testimony or produce documents, records or other information deemed appropriate.

Any person appearing before the committee would be put under oath or affirmation. Any person refusing to testify or produce requested records would be subject to penalties. The committee would have 90 days to complete its work.

That work is includes figuring who was telling the truth: State Police Commissioner Jeffrey B. Miller, who testified on March 4 that the state Gaming Control Board knew or should have known DeNaples was under investigation for perjury before he was granted a license, or former Control Board Chairman Thomas "Tad" Decker who has publicly stated they didn't.

The board unanimously approved a license for DeNaples on Dec. 20, 2006, ignoring DeNaples' near-three-decades old felony, a complaint that he sold a Hurricane Katrina-wrecked tractor trailer for hauling instead of scrap as well as his rumored ties to mob figures.

DeNaples was indicted Jan. 30 on four charges of lying to the gaming board about his relationship with two reputed Northeastern Pennsylvania mob bosses and two corrupt political fixers in Philadelphia.

He has denied any wrong-doing, but has been barred from his own $412 million Mount Airy Casino and its profits.

"I think we have to get to the bottom of this," said Shroder, a member of the House Gaming Oversight Committee. We can't just say, 'Oh, we'll do better next time.' We really have to restore the public's confidence in this whole operation."

Shroder could start by asking state Rep. Harold James (D-Philadelphia), the majority chairman of the oversight committee, why he hasn't called for hearings himself. Or ask James why the committee hasn't moved a single slots gambling reform bill in more than a year.

Ditto for state Sen. Jane Earll, an Erie Republican who heads the Senate Community, Economic and Recreational Development Committee and has similarly stymied reform efforts there.

Earll also stopped an effort last October to put state police in charge of slot licensee background investigations, saying, "I don't see any glaring problems that have been brought to light by today's testimony that we need to rush to fix."

As The Citizens Voice of Wilkes-Barre said in its editorial on Sunday, "Finding the truth is a matter of accountability to the public."


For more about Louis DeNaples and to read my complete take on this long-predicted Slotsylvania snafu, click here.

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Saturday, March 15, 2008
Posted 11:10 PM by

Time to put the blinders on in Slotsylvania

Former Gaming Control Board Chairman Tad Decker (left) and State Police Commissioner Jeff Miller (right)We may never know who lied - the state police commander or the former chairman of the Pennsylvania Gaming Control Board - if key lawmakers like Jane Earll get their way.

After first denying there was a problem with the way the state licenses its slots parlor owners, Earll (R-Erie) now says she's willing to hold hearings in light of the four perjury charges filed against slots parlor owner Louis DeNaples.

However, she does not want them to be about the conflicting testimony of state officials on how DeNaples got his license because "I'm not sure where that (investigation) gets us constructively."

As chairwoman of the Senate's Community, Economic and Recreational Development Committee, Earll is crafting the Senate GOP's plans to address the matter. "I have no desire to turn any of this into a side circus," she said.

Oops, too late.

The time for that was before the Gaming Control Board members unanimously handed DeNaples a license after a grand jury says he allegedly lied to the board about his ties to two reputed mobsters and two political fixers.

Adding to this freaky show is the fact that before DeNaples received his license he gave as much as $1.1 million an campaign contributions to the state's top officials. Among them, Gov. Ed Rendell and state Attorney Tom Corbett, who have refused to return DeNaples' money since his indictment.

The Dunmore billionaire and former federal felon has denied any wrongdoing, but has been barred from the $412 million Mt. Airy Casino Resort he owns until the charges are resolved.

Earll, whose district is home to Presque Isle Downs & Casino, voted to legalize slot machines in 2004. As chairwoman, she has refused to bring any reform legislation up for a vote in her committee for more than a year - defying many within her party who have called for change.

She also stopped an effort last October - three months before DeNaples' indictment - to put state police in charge of slot licensee background investigations, saying, "I don't see any glaring problems that have been brought to light by today's testimony that we need to rush to fix."

This being Slotsylvania, she's clearly trying to sweep things under the rug, telling the Associated Press that the conflicting accounts about what was shared between the gaming board and state police while vetting DeNaples is akin to "he said, she said."

It's much more than that.

Col. Jeffrey Miller, the Pennsylvania State Police commissioner, testified March 4 before the Senate and House Appropriations Committees that at least some of the state's seven Control Board members knew the state police were investigating DeNaples for lying to them, but they publicly voted to award him a slots parlor license anyway on Dec. 20, 2006.

In fact, Miller said, the board's own privately-hired background investigators were the ones who tipped the staties and the Feds off in the first place. (The Feds' case was later thrown for a loop when prosecuting U.S. Attorney Tom Marino left office and took a job with DeNaples.)

The Control Board's former chairman, attorney Thomas A. "Tad" Decker, has denied that the control board knew DeNaples was lying. "We didn't send a perjury referral," Decker told the Scranton Times-Tribune on March 7. "This is just flat out not true."

Yet, Sen. Robert J. Mellow, the Democratic leader from Lackawanna County and a longtime friend of DeNaples, called any Senate perjury investigation a "slippery slope."

"All we'll be doing is taking up our time policing (testimony) as opposed to doing public policy," Mellow, who voted for the slots law, told the AP.

However, Republican House leader Sam Smith, of Jefferson County, "It's hard to look at that stuff and not think, 'Somebody isn't being 100 percent truthful here.'"

Some lawmakers say they believe that lying to a legislative committee is a crime. Good luck proving that, since none of the PGCB members were sworn in during their House appropriations hearing last month.

It was an oversight and a mistake, David Atkinson, a committee spokesman, said then.

Sixty-eight House Republicans signed a letter to House Appropriations Chairman Dwight Evans (D-Philadelphia) this week asking the Appropriations Committee chairman to recall the Control Board members. "The members and the public deserve to be told honest and truthful answers from this regulatory agency." says the letter, which was released Friday

Like Earll, House Gaming Oversight Committee Chairman Harold James (D-Philadelphia) has been slow to call for hearings into the DeNaples' matter, even though Evans testified he asked him to look into it last month. James told the Pittsburgh Tribune-Review this week he is gathering information from both agencies and will call a hearing to look into it.

And just like Earll, James hasn't let any slots law reform bills comes up in his committee for more than a year.

Meanwhile, slots parlor owners - including DeNaples, may be barred by law from contributing to political campaigns, but are still allowed to lobby lawmakers largely in secret.

Things are getting so ugly in Slotsylvania, that politicians here can no longer point at Louisiana as more corrupt than they are, wrotes Allentown Morning Call columnist Paul Carpenter.

"The entire slots scam was ballyhooed from the start as a razzle-dazzle way to ease local school taxes," Carpenter wrote. "That was the worst fraud of all."


For more about Louis DeNaples and to read my complete take on this long-predicted Slotsylvania snafu, click here.

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Monday, February 11, 2008
Posted 11:13 PM by

Who pays the cost for hiding public records in Pennsylvania?

Read this entire blog post and find out from just one example!

PHEAAHere's some irony and a valuable lesson for you.

On Monday, the same day the state House "publicly debated" and approved an update to the state's weak 50-year-old Open Records law after ironing out its kinks behind closed doors for days, the Associated Press reported that a judge ruled the Pennsylvania Higher Education Assistance Authority (PHEAA) must repay three media outlets $48,000 in legal fees for refusing reporters records that were supposed to be public under the old law.

Commonwealth Court Judge Doris Smith-Ribner ruled Friday that PHEAA acted willfully and with wanton disregard to the state's Open Records law - otherwise known as the Right-to-Know Law - in a battle over spending records, including those about PHEAA's lavish board retreats.

The judge found there was no legitimate reason for PHEAA to delay access to the records for 20 months, which the quasi-public student loan and grant agency claimed were "trade secrets."

Yawning yet? Wait. It gets better from here, much better. I promise.

Just who are these no-accounts, these trough hogs, these abusers of public trust on PHEAA'S board who spent hundreds of thousands of dollars at posh resorts between 2000 and 2005 - money that could have helped worthy students pay for college?

Why they're some of the same state representatives who suddenly voted tonight - a full day earlier than expected - to send the Open Records bill back to the state Senate, where much of a 13-month delay previously occurred.

In case you didn't know, the PHEAA board is made up mostly of state lawmakers, including: Rep. William F. Adolph Jr. (R-Springfield), its chairman; Sen. Sean Logan (D-Monroeville), its vice chairman; Rep. Ronald I. Buxton (Harrisburg), Rep. Ronald I. Buxton (D-Harrisburg), Sen. Jake Corman (R-Bellfonte), former state Sen. J. Doyle Corman (Jake's father), Rep. Craig A. Dally (D-Nazareth), Sen. Andrew E. Dinniman (D-Exton), Sen. Jane M. Earll (R-Erie), Sen. Edwin B. Erickson (R-Newtown Square), Rep. Dan Frankel (D-Pittsburgh), Sen. Vincent J. Fumo (D-Philadelphia), Sen. Vincent J. Hughes (D-Philadelphia), Rep. Sandra J. Major (R-Montrose), Rep. Jennifer L. Mann (D-Allentown), former Rep. Roy Reinard (Holland), Rep. James R. Roebuck Jr. (D-Philadelphia), state Banking Secretary A. William Schenck III, Rep. Jess M. Stairs (R-Acme), Sen. Robert M. Tomlinson (R-Bensalem), and state Education Secretary and ex-officio Penn State trustee Gerald L. Zahorchak.

How bad do things have to get before Gov. Ed Rendell declares publicly, "It's a disaster. We have to totally re-evaluate PHEAA. I think we have to clean house and establish a new culture."

(I could say the same thing about the entire Legislature, the state Supreme Court and the governor himself, but I digress.) Rendell's threat to PHEAA came March 14, 2007.

In response, the PHEAA board issued a press release March 22, vowing it would change.

On April 20, the board issued another press release saying it had adopted a code of ethics that "formalizes longstanding policies and practices that have helped PHEAA's public service mission to always stay focused, first and foremost, on the students' best interests in all business dealings."

But on Aug. 24, Rendell again threatened to privatize the agency - or, at the very least, restrict how it spends money and consider replacing board members - after the board handed out bonuses as high as $180,857 to top PHEAA executives.

On Oct. 10, PHEAA CEO Dick Willey resigned in disgrace - two months earlier than he planned - and less than a week after preliminary findings of the first-ever state audit of PHEAA showed the board had given out $7.5 million in executive bonuses in just three years.

State Auditor General Jack Wagner also found that PHEAA had rented Hersheypark for a day in April, providing free rides and food for employees and their guests, at a total expense of $108,000. The deal to lease the amusement park was signed just one day after PHEAA's board issued its news release promising to tighten expenses.

Senator Logan, vice-chairman of PHEAA's board, claims the board members knew nothing about the staff outing and admits he demanded Willey resign immediately.

I couldn't find an explanation for why Logan simply didn't call an emergency meeting of the board and fire Willey's ass on the spot, because he didn't just walk away empty-handed.

Willey took his $370,000 annual pension with him. His predecessor, PHEAA founder Michael Hershock, retired from the authority at the end of 2002 with a $222,173 yearly state pension plus a $321,409 lump sum payment. Yet, he was also still drawing a $147,000 salary from PHEAA in 2006, the Pittsburgh Tribune-Review found.

How did the board react to all this?

In October it started cutting back - on its own mission - by reducing the number of grants given to full-time students and for financial aid to adults taking job-training classes. It blamed a new federal law governing student lenders and unsettled financial markets for a projected $44.4 million reduction in spending on the aid programs in 2008-09, down from $105.8 million this year.

The board then issued a press release on Jan. 24 claiming PHEAA is now in "99.5% compliance with new, stricter spending policies."

That led Senator Fumo - who also happens to be under federal indictment for allegedly extorting $17 million from PECO Energy for a non-profit group in his district and then allegedly covering it up - to vehemently claim penny pinching by the PHEAA board was now hurting its efforts to gain funding for student loans and grants.

"I think the auditor general should be ashamed for trying to run a political campaign on the backs of the students of this commonwealth," Fumo charged.

Wagner, who is seeking re-election this year and is considered a potential candidate for governor in 2010, denied Fumo's allegation without laughing too loudly. His audit won't be complete until June.

This now bring us all the way back to that $48,000 the judge ruled PHEAA now owes to Pittsburgh TV station WTAE-TV, the Patriot-News of Harrisburg and the Associated Press.

Under the old law, PHEAA's board members cannot be held individually liable for their decision to deny the public records which sparked the 20-month legal fight and the resulting investigations. But the board was legally able to sue reporters seeking the information personally in hopes of blocking their requests.

Instead, the money to repay the media's legal costs will likely come out of PHEAA's operating budget - hurting students even more - or from errors and omissions insurance, if the board had the wisdom to take out such a policy.

I've long advocated that any change in the Open Records law must hold public officials personally liable for such denials so taxpayers don't get stuck with the bill or paying higher insurance premiums for governmental agencies.

But guess what the new Open Records bill - Senate Bill 1 - doesn't say?

S.B. 1 could be on Gov. Ed Rendell's desk by the end of the day tomorrow, even though Common Cause of Pennsylvania has withdrawn support for it, arguing the bill is too weak and has a built-in conflict of interest.

Pennsylvania Newspaper Association lobbyist Deb Musselman told the AP her organization was withholding judgment, particularly because of a last-minute addition that would deny access to records identifying the names, home addresses or dates of birth of children 17 or younger

Although legislative records would be fully covered under the Open Records bill for the first time, the reason House leaders could meet in secret over the last five days to discuss changing the bill is that the Legislature is still the only state agency exempt from the state's 34-year-old Open Meetings Act or Sunshine Law while meeting in caucus.

That's progress, Pennsylvania-style, folks.

Or as Patriot-News Executive Editor David Newhouse told the AP, "We can only hope that the new Right-to-Know Law will make it so the average citizen doesn't have to pay $50,000 and take a case to the Supreme Court to get information that they have a right to in the first place."

One final thought.

Given the revelations contained within the 13,470 pages of records the three media outlets had to sue PHEAA in appellate courts to obtain, all they've won so far is their money back, no real public thanks - and possibly a three-way share in a Pulitzer Prize.

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Saturday, February 09, 2008
Posted 4:59 PM by

Have lobbying and partisanship trumped public protection in Slotsylvania?

There's slots of bills pending to change Pennsylvania's fledgling gambling industry, including one that would stop their millions of dollars in lobbying.There are plenty of bills pending in Pennsylvania's Legislature that would have reformed the state's slot machine gambling law before the indictment of slots parlor owner Louis DeNaples last week.

None of them have yet to see the light of day, much less been voted upon.

And if ever two guys needed to be stuck in an elevator together to find common ground for the public good, it's state senators Jeffrey Piccola and Sean Logan.

Logan (D-Allegheny) voted for the law legalizing slot machine gambling (Act 71) in 2004, but introduced a bill on March 22, 2007, to stop the state's fledgling gambling industry from lobbying lawmakers and to prevent lobbyists from serving as a pass-through for outlawed campaign contributions.

In effect, Senate Bill 658 would shut off the spigot of millions of dollars being spent annually with no public scrutiny to influence legislators into expanding legalized gambling (see H.B. 2121) and who knows what else.

However, Logan's bill has gone nowhere since it was introduced, remaining stuck in the Senate's Community, Economic and Recreational Development Committee.

Piccola (R-Dauphin), a former majority caucus administrator and whip, is a member of that committee and is no fan of the state's industry-written and hastily-passed slots law either - at least the way it exists currently.

Piccola voted against the slots law in 2004 and was one of 13 senators who fought in August 2006 for a package of 21 bills that would have: prohibited public officials and their families from holding any ownership interest in casino-related firms, created an entirely new Gaming Control Board with only five members appointed by the governor and confirmed by the senate, banned the board members from having any other salaried jobs, and rejected any slots license applicants who have felony criminal records (the 2004 slots law forgives convictions before 1991).

The senators urged the control board not to approve any more licenses - including one for DeNaples, a Dunmore billionaire who admitted a federal felony in 1978 - until their reform measures were heard. Some of them, including Piccola, even threatened to shut down the state government and all active casinos during budget wrangling in July 2007 to get their bills enacted.

They failed.

Piccola has since called DeNaples' indictment for lying to the control board about his allleged mob ties "a black eye on Pennsylvania" while standing on the floor of the Senate.

On Wednesday, the same day DeNaples was arraigned on the perjury charges, Piccola announced he will try again to reform the slots law.

Although his new bills have yet to be introduced, this time they appear far less sweeping. His proposed changes now include:

  • opening all portions of the application process relating to character and integrity of applicants, principals, and key employees to public scrutiny.

  • transferring the Gaming Board's Bureau of Investigation and Enforcement to the Office of the Attorney General (a move the state police commander has said won't make any difference)

  • requiring all applicants to make Freedom of Information Act requests regarding their criminal file and providing all documents obtained to the Bureau of Investigation and Enforcement.

If Piccola wants to be seen as a true reformer, then why hasn't Logan's bill made it out of his committee? Is the fact that Logan is a Democrat, and Piccola is a Republican, the reason?

The chairperson of that committee is state Sen. Jane Earll (R-Erie), a former candidate for lieutenant governor who voted in favor of the slots law in 2004 but told Project Vote Smart that she is against expanding it to include riverboat gambling.

Earll stopped an effort last October to put state police in charge of slot licensee background investigations, saying, "I don't see any glaring problems that have been brought to light by today's testimony that we need to rush to fix."

Her refusal to act came after the FBI informed the control board that it wasn't a law enforcement agency and therefore could not see the information bureau agents had collected on DeNaples, according to the Pittsburgh Tribune-Review.

Logan's bill is not the only reform-minded measure stuck in Earll's committee. Also pigeonholed there is S.B. 856, which merely adds "former candidates" to the list barred from receiving direct campaign contributions from gambling interests.

I don't know how much money Earll has accepted in campaign contributions from gambling interests. The state's online database lists 1,177 contributions to her since Jan. 1, 2000, but many of the contributors's occupations and employers have been left blank.

She did receive a total of $875 from William J. Bleill, a consultant for First Presque Isle Corp. I don't know what relationship, if any that company has with MTR Gaming Group Inc., the parent company of Presque Isle Downs & Casino near Erie. Earll also accepted $175 from Edson R. Arneault, president, CEO and chairman of MTR.

Earll's committee is similarly stymieing:

  • S.B. 113, which would require the control board to take a public vote among all seven members - not just a supermajority consisting of the governor's appointee and four legislative appointees - on whether to take enforcement actions against a slots parlor license holder.

  • S.B. 423, which allows slots parlors to issue rewards cards to frequent gamblers, but also requiring each casino to issue monthly statements that list patrons' gaming winnings and losses.

  • S.B. 855, which requires all Gaming Control Board appointees to be confirmed by the Senate.

  • S.B. 600, which bars the Gaming Control Board from hiring relatives, requires all prospective board employees to submit their "complete criminal history" and to take a drug test, and subjects all control board employees "who, while on duty or off duty, engages in scandalous or disgraceful conduct which may bring the service of this Commonwealth into disrepute" to prompt disciplinary action and immediate suspension.

  • S.B. 1031 and S.B. 1032, which would prohibit the location of a slots parlor within 1,500 feet of a school, church or home.

None of those measures are nearly as controversial as S.B. 683, which state Sen. John Rafferty Jr. (R-Montgomery County) introduced on March 23, 2007. It would require a binding referendum be approved in any municipality where a slots parlor has been proposed.

Yet, none of those bills have moved out of Earll's committee in nearly a year.

Stumbling blocks toward reform are not limited to the state Senate and are not only being erected by Republicans.

On Jan. 30, 2007, state Rep. Michael O'Brien (D-Philadelphia) introduced House Bill 14, which like Sen. Rafferty's bill, would require approval of a slots parlor in a local binding referendum. It has been stuck in the House Committee on State Government ever since.

Bottled up in the House Committee on Gaming Oversight since March 6, 2007, is H.B. 567, which would prohibit further gambling expansion without the approval of a statewide referendum or by a two-thirds vote of the General Assembly.

The chairman of the Gaming Oversight committee is Harold James (D-Philadelphia), who has been singled out for criticism by House Republicans for failing to move H.B. 1450. That bill would put the state police in charge of doing slots parlor licensee background checks (even though, again, the state police commander has said it won't make any difference).

James voted for the 2004 slots law. It was impossible to tell from the state's online database whether he received campaign contributions from gambling interests. It lists 337 contributions since Jan. 1, 2000, but many of the occupations, employers and even names have not been completed.

James' committee is also holding up:

  • H.B. 482, which would cut the pay of Gaming Control Board members to $64,178, except the chairman who would get $66,810. Currently, board members are paid $145,000 and the chairman gets $150,000. (There is currently no law or bill pending on what the board can pay its employees.)

  • H.B. 909, which would require an audit if a slots parlor fails to generate 85 percent of its anticipated revenue in a year.

  • H.B. 1181, which would reduce the potential number of stand-alone casinos from five to three.

  • H.B. 1477, which would prohibit the location of a slots parlor within 1,500 feet of a school, church or home.

  • H.B. 1715 and H.B. 1975, which would require $1.5 million to $3.5 million be transferred annually from the Pennsylvania Gaming Economic Development and Tourism Fund into the Compulsive and Problem Gambling Treatment Fund.

None of those measures are nearly as controversial as H.B. 2121, which would expand the state's definition of legalized gambling to include table games - including roulette, baccarat, blackjack, craps, big six wheel, mini-baccarat, red dog, pai gow, poker, twenty-one, acey-ducey, chuck-a-luck, fan-tail, panguingui, chemin de fer, sic bo, and any variations or composites of such games - in effect turning the slots parlors into full-fledged casinos.

The table games bill was introduced July 14, 2007, by Majority Floor Leader H. William DeWeese and immediately garnered 19 Democratic supporters. They include state representatives: James Wansacz (D-Lackawanna County), Thomas Caltagirone (D-Berks County), Todd Eachus (D-Luzerne County), Florindo Fabrizio (D-Erie County), Dan Frankel (D-Allegheny County), Michael Gerber (D-Montgomery County), R. Ted Harhai (D-Fayette County), Patrick Harkins (D-Erie County), John Hornaman (D-Erie County), Deberah Kula (D-Fayette County), Frank Louis Oliver (D-Philadelphia County), John Pallone (D-Armstrong County), Eddie Pashinski (D-Luzerne County), Dante Santoni Jr. (D-Berks County), Frank Andrews Shimkus (D-Lackawanna County), John Siptroth (D-Monroe County), Majority Caucus Administrator Dan Surra (D-Clearfield County), Jesse White (D-Allegheny County), and Edward Wojnaroski Sr. (D-Cambria County).

House Bill 2121 would turn Pennsylvania's slot parlors into full fledged casinos.DeWeese has accepted 4,401 campaign contributions from individuals and political action committes since Jan. 1, 2000. Again, it's unclear from the state's online database how many came from gambling interests because many of the employers and occupations have been left blank.

Like the rest of the bills pending before the Gaming Oversight committee, DeWeese's table games bill has been tabled since it was first introduced.

But given the continued flow of lobbying money and in-direct campaign contributions to lawmakers, which bill do you think will pass first?

I can tell you this, DeNaples, who has said he never placed a bet in his life, predicted in 2006 that table games would be a reality within two years.

Finally, one slots gambling-related bill was introduced this week by state Rep. RoseMarie Swanger (R-Lebanon) after Gov. Ed Rendell announced a state funding package designed to help lure a professional soccer team to the city of Chester .

H.B. 2225 would prohibit any money in the Gaming Economic Development and Tourism Fund from beng used for multipurpose recreational facilities or sports facilities.


For more about Louis DeNaples and to read my complete take on this long-predicted Slotsylvania snafu, click here.

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