Twenty-five Indiana bingo parlors collectively took in more than $52 million last year, but gave only $1.6 million to the charities they were established to support, according to an Indianapolis Star analysis.

The parlor with the lowest percentage profit, SeVille Senior Citizens Center in Muncie, took in more than $1.5 million last year from hosting bingo games to benefit the center. But it gave only $677 to charity.

SeVille is under investigation by the Indiana Department of Revenue for license violations.

Under new rules that go into effect in May, bingo parlors with income in excess of $500,000 must give 10 percent of their revenue to charity, regardless of expenses. Several bingo parlors have sued the department over the regulations.

Under the new rules, SeVille would be required to increase the amount it gives to charity from $677 each year to $152,931.

SeVille's president, Monna Gregory, denies that the parlor currently donates such a small amount to charity, although the group reported the figures in amended filings to the Indiana Department of Revenue. She declined to provide The Star with additional financial information.

Indiana's charity gaming parlors include two games -- bingo and pull tabs, $1 tickets that some say are the paper equivalent of slot machines. Players can win more money on bingo, but parlors make more money on pull tabs.

Indiana, whose 548 charitable gambling groups took in $559.8 million during the 2003 fiscal year from bingo and pull tabs, is the fourth-largest bingo state in the nation.

But the state's parlors reported losing $4.1 million on bingo during that same period, said Larry McKee, deputy director of the Indiana Department of Revenue, which regulates charity gaming.

While many individual parlors are well run and donate millions to charity, McKee said the losses and low profits raise concerns about illegal cash-skimming and other misdealing among some parlors in the cash-only industry.

McKee said the Revenue Department also has concerns about parlors that show low income from pull-tabs, considered to be a lucrative game.

The Lions Club bingo in New Palestine took in more than $1.52 million in revenue between May 2002 and April 2003.

But the club reported making a larger percentage profit selling soda to its bingo players than it did selling them pull tabs, according to The Star's analysis.

And the bingo parlor claimed a loss of more than $139,000, or 43 percent, on bingo games, according to the income forms.

The bingo's treasurer, John Biersdorfer, acknowledges the parlor's profit for charity is small. But he said the club keeps hosting bingo to help provide college and trade school scholarships.

Each year, the Lions Club gives 19 scholarships totaling $21,000 to students in Hancock County, paid for by charity gaming proceeds.

Biersdorfer and many other bingo organizers said expenses are too high to give more money to charity. Others say competition is so fierce that they must offer lower prices and larger prizes to lure customers.

"You have to have your bingo payout, and you're going to have to have your promotional stuff to get people to come in," said Sheryl Mong, bingo manager at AMVETS Post 12 in Muncie.

Mong said her bingo hall celebrates its players' birthdays with cakes and lets regular players age 87 and older play free.

Now Mong and other bingo managers are trying to figure out how they will adapt to the new bingo rules. Many parlors have argued that being forced to give a set percentage of their revenues to charity will put them out of business.

But McKee said the rules are necessary to make sure that parlors meet their mission--to give money to charities such as Girl Scout troops, veterans hospitals and the Special Olympics.

The department crafted the new regulations after a 2001 Marion County grand jury investigation found that four people siphoned at least $3.5 million from four bingo operations, and the sponsoring charities received only a fraction of the profits.

Gregory, SeVille's president, faces a Jan. 28 hearing before the Revenue Department for several license violations, including using a nonlicensed worker and providing 18 illegal gambling machines in the bingo hall, according to an investigation by the Indiana Department of Revenue.

Gregory apparently told department officials that the center had the slotlike machines for two years, and she listed $16,000 of income from them as "contributions" to the parlor.

But some bingo players were shocked to learn that such a small percentage of money makes it to charity.

Wanda Rice, of Indianapolis, said she's been to many scholarship presentations during bingo games at the New Palestine Lions Club, so she's always assumed a large portion of the parlor's receipts went to charity. And she knows of a fellow player who received a donation to help pay for his cancer treatments.

"They have people coming in all the time to show that they're getting the scholarships," Rice said. "I thought there would be a lot more profit than that."

Contact Star reporter Kristina Buchthal at 1-317-444-6399.

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