Members of Nashua Elks Lodge 720 paid a dollar a minute to buy phone cards and receive corresponding credits they could use to play games on a machine for cash prizes.
The lodge called it fun; the state called it gambling.
The lodge collected $70,000 in profits in six months from members playing these sweepstakes games on five machines, funding $15,000 in Christmas gifts for 75 children and renting a bus to take youngsters to summer camp, according to the lodge’s exalted ruler, Douglas Tremlett.
Patrons could use their credits to play poker and keno, among other games, he said. The most cash he heard of someone winning was about $900, he said. The Elks received 60 percent of the profits and paid prizes from money provided by the machine vendor.
“Most people didn’t care about the phone cards,” he said Friday. “We’d take the phone cards and donate them to the VA in Manchester.”
On June 18, Gov. John Lynch signed a bill making such sweepstakes games illegal in the state — and the Elks lodge had the equipment removed.
“I wish the state would legalize them just like bingo,” Tremlett said. “They made it easier for us to donate money to sponsor kids.”
By one count, the New Hampshire Racing and Charitable Gaming Commission said at least 16 locations in 13 communities, mainly in southern New Hampshire, hosted these sweepstakes games.
“From my own experience seeing the machines, there’s a lot of money out there,” said Paul Kelley, the commission’s director.
Kelley, who also serves as Seabrook’s town moderator, said he has seen the operation at 3D Business Center in Seabrook.
“There’s lines to play the machines, to supposedly buy their phone cards,” Kelley said. “When was the last time you went down to Cumberland Farms or Richdale’s to wait in line to buy a phone card?”
Portsmouth attorney Patrick Fleming, who represents the Seabrook business, said he has filed paperwork in Rockingham County Superior Court requesting a temporary restraining order against the state; a hearing will be held Thursday.
“I think it’s so overly broad it invites discriminatory enforcement,” Fleming said of the law.
On Monday, the state Attorney General’s Office will brief local police on the new law.
“We’re going to meet with police departments on what the law provides and talk about the possibility for investigation and enforcement,” Deputy Attorney General Ann Rice said.
The law, which began as an effort to expand poker games in the state, ended up reining in these sweepstakes games.
“What I hear is these are similar to video lottery machines you’d find in a casino,” Rice said. She declined to comment on Fleming’s court filing.
Not all the locations were generating profits, according to the owner of a former sweepstakes business at 223 S. Willow St. in Manchester.
“It simply wasn’t making money,” said James Daskal, owner of Connection House. “It wasn’t doing the numbers it was projected.”
Daskal tangled with city officials over licensing the machines, unsuccessfully appealing a $36,000 bill for licensing fees. He shut his business in April before the licenses were up for renewal.
“If you’re not making money, why throw good money after bad,” he said.
Daskal said people could come in and get free sweepstakes entries and earn more if they bought Internet time on 24 computers.
“I personally don’t think we were doing anything illegal,” he said.
Rice said the law allows for the attorney general, a county attorney or police chief to “go to court and ask for an order to cease operations,” and the machines potentially could be forfeited. Using the machines for gambling purposes can lead to fines of not less than $5,000 per machine per day.
According to the gaming commission, there were sweepstakes machines in Seabrook, Dover, Salem, Belmont, Nashua, Manchester, Hampton Beach, Raymond, Kensington, Hudson, Portsmouth, Hampton Falls and Londonderry.
Kelley said the list isn’t kept updated; at least some businesses have since had the machines removed.
Rep. Ken Hawkins, R-Bedford, worked on the law, flipping the bill’s intent by 180 degrees from the original sponsor. Rep. George Lambert, R-Litchfield. Lambert said his bill was intended to legalize certain poker games, including those played in private homes, and he opposed the sweepstakes language.
“By the time it got done, I didn’t own a single sentence in it, but it had my name on it,” Lambert said.
Hawkins said what Lambert’s proposal “amounted to for a lot of us is expanded gambling, and we’re against expanded gambling.”
The state lottery, meanwhile, worried about the competition from these unregulated sweepstakes games.
“There’s only so many discretionary dollars to go around,” said Charlie McIntyre, executive director of the New Hampshire Lottery Commission. “For us, it’s money not going to education.”
Back at the Elks club, Tremlett said the machines will be missed.
“A lot of our members wished it was back here,” he said. “They enjoy playing it.”
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Mike Cousineau may be reached at email@example.com.