Post 2 of the American Legion had held off on its tentative decision to cancel Dover's Independence Day Parade due to good faith negotiations with the Office of the Governor, American Legion Post 2 Adjutant Jeffrey Crouser said Monday.

The Non-profit Coalition of Delaware formed to legalize lottery machines at American Legions and VFWs throughout the Diamond State and the Office of the Governor met Monday night to continue talks on restoring the use of such machines.

As such, Post 2 of the American Legion had held off on its tentative decision to cancel Dover's Independence Day Parade due to good faith negotiations by both parties, American Legion Post 2 Adjutant Jeffrey Crouser said Monday.

Post 2 of the American Legion had announced late last week that the annual parade could not be held due to resources lost through the governor's ban of video lottery games. Crouser said the announcement late last week that the parade would be canceled was premature and predicated by what was deemed as an inadequate, initial offer by the governor's office to solve the gambling machines riddle.

"We were discussing that as a worst case scenario," Crouser said, the coalition chairman. "Somebody got carried away and a press release got sent out. We are negotiating in good face with the governor's office and vice versa."

Hundreds of members of American Legion, VFW, Elks and Moose lodge members and others marched around Legislative Hall Jan. 10 to petition state legislators to reinstate the use of gambling machines at their organizations.

It was the first organized, lobbying response to the state's declaration that the use of gambling machines by veterans and other organizations was illegal this past autumn. The Oct. 22, 2012 letter from the Delaware Department of Safety and Homeland Security stated that several social organizations, clubs and businesses had been illegally permitting patrons to play gambling devices in their establishments. State officials ordered the machines shut down and removed immediately under the threat of negating liquor licenses.

Among those lobbying state legislators was American Legion Post 2 Commander James Cole, who said that it was no business of the state to dictate how the American Legion spent its money.

Nonetheless, American Legion Post 2 leaders said they felt a compromise was possible in the official press release they issued on Saturday. The Coalition met with officials from the governor's office at Walter L. Fox Post No. 2 American Legion, which has 2,660 members, off Bay Road in Dover.

Deputy Chief of Staff Greg Patterson and Finance Secretary Tom Cook represented the governor's office, said Catherine Rossi, communications director for Gov. Jack Markell.

"We believe we are making progress towards an arrangement - which will have to be approved by the General Assembly - to allow some form or gaming machines in some non-profit organizations under a number of conditions," she said.

Coalition officials hoped for "a quick restoring of Lottery Machine" through a compromise that would allow members to use gambling machines "under state control."

"In order to continue to support veterans and our community, we need a quick and amicable solution," said Jim Gallagher, commander of American Legion Post 28 in Oak Orchard-Riverdale, which has 6,508 members. "If the talks go well, we're looking forward to be able to start our machines under state control soon. That will allow us to support our charitable constituencies, which are hurting as much as we are."

The American Legion, the Veterans of Foreign Wars, the Fraternal Order of Elks, Moose Lodge, Amvets and Delvets and the Fraternal Order of Eagles comprise the Coalition, Crouser said. All of the organizations combined had donated $5.5 million annually to various charities and causes in communities statewide thanks largely to use of nickel and dime gambling machines, he said. That included $100,000 alone from the Fox American Legion in the state capital.