Lipscomb city assets remain frozen over illegal gambling

The Lipscomb City Council and Mayor called a special meeting Monday to take steps this week to extricate the City from a public nuisance lawsuit filed by Alabama Deputy Attorney General John Kachelman. The state’s restraining order, which froze the City’s assets last week, has jeopardized the City’s financial stability and ability to pay employees and meet its financial obligations.

During Monday’s meeting, the City repealed its long-standing bingo ordinance. Lipscomb is a defendant in a case filed against Jay’s Charity Bingo because, according to the law, the municipality is responsible for enforcing the game of bingo and the party that has licensed it and continues to profit from and obtain illegal funding from illegal gambling.

In August, authorities seized illegal gambling machines from an establishment in the City, but this did not stop the gambling because other machines were brought in to replace those. The City is alleged to have profited from the bingo money, and the Attorney General states that Lipscomb shouldn’t be allowed to profit from criminally derived dollars.

WBRC reported that after the City’s meeting, a court hearing was held to determine whether the City’s assets would remain frozen. Last week, some of the assets were released, but two accounts — the bingo fund and the operational fund — were still out of the City’s control.

The City moved at least $200,000 from the bingo fund to the operational fund. The state calls the money from bingo proceeds criminally derived dollars and doesn’t believe the City should be able to keep it. Kachelman told the court, “Those are ill-gotten gains. They shouldn’t be able to profit from those, which they have all year long.” Kachelman asked the judge to extend the restraining order so they could sort out the funds, agreeing to release enough to make payroll to prevent shutting down the City.

Jefferson County Circuit Judge David Carpenter agreed to extend the restraining order until December 9 so the state can determine what happened to the $200,000. As of now, the bingo account has $100 left, and the operational fund has a reported balance of $17,000.

WBRC asked the city attorney, Lucien Blankenship, what happened to the remainder of the $200,000, but he did not explain. He stated, “I’m legal counsel; I’m not the accountant.”

This situation has led to significant discord among the Lipscomb City Council and Mayor Tonja Baldwin. They are at odds over who put the City in a difficult situation. Mayor Baldwin blamed the city council, saying they had the opportunity to change some of the wording in their bingo ordinance but chose not to. She felt the lawsuit would not have included the City if they had. Councilor Barbara Moore, on the other hand, felt the council had been left in the dark on decisions, adding to the tension. Moore stated, “The majority of councilors support this investigation as we have not received adequate information from the mayor concerning the use of these funds. As elected officials, it is our responsibility to seek full accountability.’

The situation is still ongoing and remains to be resolved.

Sherri Blevins is a writer for Mountain Valley News and a staff writer for Yellowhammer News.