Gambling on ballots could hurt Nevada | NevadaAppeal.com

Gambling on ballots could hurt Nevada

Guy Farmer

Gambling initiatives on the ballot in California and Washington state, two of our major tourism markets, could damage Nevada’s economy if voters in those nearby states decide to approve massive expansions of legal gambling.

And given the “something for nothing” mood of voters this year, it’s entirely possible that they’ll turn to Nevada-style gaming on Nov. 2 to resolve severe state budget problems.

In neighboring California, Gov. Arnold Schwarzenegger is opposed to propositions that would expand Indian gaming and permit non-Indian gaming establishments to operate as many as 30,000 slot machines, thereby breaking the tribal monopoly on legal gambling in that state.

Proposition 68 would allow 16 racetracks and card clubs to operate thousands of slot (mostly video poker) machines in return for paying one-third of their winnings to state and local governments, while Proposition 70 would allow gaming tribes to operate an unlimited number of slots if they pay 8.8 percent of the proceeds to the state.

“More than 100 organizations agree that we have to vote against propositions 68 and 70 because they are bad policy, bad precedent and bad for California,” said Gov. Schwarzenegger, who has negotiated a series of sweetheart gaming deals with Indian tribes. For their part, Proposition 68 backers assert that it would generate up to $2 billion annually for cash-strapped state and local governments while Proposition 70 proponents claim that it will ensure that Indian tribes pay their fair share of state and local taxes.

Needless to say, tribes that currently enjoy a casino gaming monopoly in California – and Nevada gaming licensees that operate Indian casinos – are spending millions of dollars to maintain the status quo.

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One ad against Proposition 68 accuses proponents of joining pornographer Larry Flynt and “gambling industry special interests” (translation: Nevada casino operators) in an attempt to force gaming tribes “to agree to unreasonable and possibly illegal conditions in violation of our gaming compacts.” This illustrates how desperate gaming tribes are to maintain a monopoly over their virtually uncontrolled, and highly profitable, industry.

The Thunder Valley Casino, located on Interstate 80 at Auburn, is operated by Station Casinos of Las Vegas, which rakes in tens of millions of dollars on a lucrative management contract while competing directly with struggling Northern Nevada casinos. Meanwhile, Attorney Gen. Brian Sandoval and Nevada gaming control agencies turn a blind eye to an obvious violation of Gaming Commission regulations. So much for gambling control in the era of corporate gaming.

I saw several thriving Indian casinos along Interstate 5 on my recent trip to Seattle. All of them advertise “Nevada-style gaming” and market themselves as viable alternatives to the Silver State. In our area, besides the Thunder Valley and Cache Creek casinos just east of Sacramento, major resorts are planned for San Pablo near San Francisco and Shingle Springs in the Sierra foothills even closer to Reno and Tahoe. The Maloof brothers, who own the Palms Casino Resort in Las Vegas, want to operate the huge (5,000 slots) Indian casino at San Pablo.

Meanwhile, our Pacific Northwest gaming market will be impacted by initiative proposition I-892 on the Washington state ballot. It would permit slot machines in non-Indian venues throughout the state and is being promoted as a measure to reduce property taxes. Backers of 892 deplore an “obscene and unsustainable” six-fold increase in property taxes between 1980 and 2003 and claim that their proposal would generate an estimated $400 million in property tax relief by imposing a 35 percent fee on slot machine proceeds.

But the Rev. John Boonstra, executive director of the Washington Association of Churches, argues that I-892 would put slot machines “on every corner – near schools, libraries, parks and churches,” and adds that the measure disguises slots as “electronic scratch-ticket machines” in an effort to fool gullible voters. Again, gambling tribes have spent millions of dollars to defeat a proposition that would threaten their monopoly on casino gaming in Washington state.

Rev. Boonstra’s argument resonates with me as I worry about the proliferation of small casinos in Carson City along with the sleazy check-cashing “services” that inevitably attach themselves to new casinos like parasites. I don’t think slot arcades offer a solution to Carson’s revenue problems and urge the 2005 State Legislature to regulate interest rates that these rip-off “services” can charge. And if you doubt whether this is a growing problem in our historic capital city, just drive down Carson Street and count the number of storefronts offering “instant cash” at exorbitant interest rates. All you have to do is sign over your car, or anything else of value, to these financial predators.

Anyway, my hope is that California and Washington voters will reject the expansion of casino gambling in their respective states, but I fear that the lure of “instant cash” Ð something for nothing, if you will Ð is too strong to overcome by reason and logic. And if that occurs, the fallout will be devastating for our tourism-based economy.

KUDOS to Secretary of State Dean Heller for keeping exit pollsters at least 100 feet away from polling places. If it were up to me, however, I’d impose a 100-mile limit on these unwelcome intruders. Oh yes, one additional endorsement: I favor incumbent Supreme Court Justice Michael Douglas over right-wing challenger Joel Hansen.

Guy W. Farmer, a semi-retired journalist and former U.S. diplomat, resides in Carson City.