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Gaming Guru

Howard Stutz

Push for bill draft to define restricted gaming locations fails

28 May 2014

LAS VEGAS -- A legislative committee looking at technology and gaming spent roughly 95 percent of its final hearing Tuesday debating taverns and other restricted slot machine businesses and whether or not a litmus test was needed to determine whether gambling revenue was “incidental” to a location’s success.

In the end, the committee decided to leave well enough alone.

Despite several attempts by Assembly Majority Leader William Horne, D-Las Vegas, the committee’s chairman, to push forward a bill draft calling for a definition of traditional and non-traditional restricted gaming locations, the matter died.

“I just don’t see us reaching consensus on a bill draft,” Sen. Greg Brower, R-Reno, said of the proposal. He suggested the committee “punt” the idea.

The committee, meeting at the Sawyer Building, also rejected a bill draft that would have created a revolving fund to pay for periodic investigations of restricted gaming locations and a proposal that would allow betting in Nevada on federal elections.

The interim study committee did support a suggested bill draft; one that encourages the development and deployment of gaming devices “incorporating innovative, alternative, and advanced technologies.”

The real issue Tuesday, and throughout the committee’s three previous meetings, concerned nontraditional restricted gaming locations, a business model often associated with the chain of Dotty’s Gaming and Spirits locations.

Tavern operators, gaming attorneys, a representative of Station Casinos, Inc., Clark County Commission Chairman Steve Sisolak and gaming regulators all offered testimony on restricted gaming Tuesday.

Tavern owner Randy Miller, a nonvoting member of the committee, told Horne that changes made to restricted gaming laws in the 2013 Legislative session already addressed the definition of taverns. He suggested committee members not propose any new regulatory changes and let the most recent additions work their way through the system.

“It too premature to rewrite the tavern law,” Miller said.

Dotty’s has come under fire over the past few years for a business model in which its taverns offer minimal food and beverage items and rely on gaming revenue from 15 slot machines. According to gaming and county officials, the gaming figures can be as much as 70 percent of the location’s overall total.

Sisolak said the Dotty’s business model was “proliferating” throughout the Las Vegas Valley, bringing “slot machine parlors into neighborhoods.”

Station Casinos Senior Vice President of Government Affairs Mike Sloan, who was also a nonvoting committee member, said he wasn’t concerned about traditional taverns, which have large restaurants.

Businesses such as Dotty’s, however, don’t provide the same economic benefit to the state, Sloan said.

Nevada Gaming Commission and Control Board Chairman Peter Bernhard, however, said the traditional versus nontraditional tavern issue has “been vetted many, many times” in the last few years. The commission voted to change some of the regulations governing taverns in 2011.

“This is not a recent issue,” said Bernhard, a nonvoting committee member. He blamed Station Casinos for keeping the debate alive.

“A loud and persistent competitor has continued to bring this to everyone’s attention,” said Bernhard, who works as Of Counsel for a Las Vegas law firm that has represented Dotty’s. During gaming commission hearings, Bernhard has disclosed the relationship and said he not privy to any of the files or matters concerning the business. He has cleared his participation with the Attorney General’s office.

Bernhard ran through several pages of statistics compiled by the Gaming Control Board which showed the large growth of Dotty’s and other similar businesses since 1996, when there were just four locations. In fiscal year 2014, there were 101 non-traditional tavern locations statewide.

However, the number restricted locations statewide has declined.

Bernhard blamed the voter-enacted 2006 ban on smoking inside restaurants and other public places and the recession, with reducing the number of restricted gaming businesses. Dotty’s and similar businesses moved into those closed locations.

“We really have heard enough on this issue,” said Gaming Control Board Chairman A.G. Burnett.

The proposal for election wagering, offered by Sen. Tick Segerblom, D-Las Vegas, was debated briefly.

Brower, the Reno state senator, said elections should not be the subject of wagering activity.

A similar proposal offered by Segerblom in the 2013 Legislature died during the session. Segerblom has said pari-mutuel wagering on elections for president and the U.S. Senate and House could boost state gaming revenue.
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