Monthly Archives: July 2008

Can Kansas save The Woodlands?

Casino Watch has reported that The Woodlands, one of Kansas oldest live horse and dog racing tracks, announced they were going out of business on Aug 24th due to market forces and an unworkable deal with the state to include slot machines at the track.  Now Forbes is reporting that Kansas is attempting to keep The Woodlands open:

The state of Kansas is continuing talks with the Woodlands in the hopes of reaching a deal that would put slot machines at the horse and dog tracks in Kansas City, Kan., and keep that business open, Kansas Lottery Executive Director Ed Vane Petten said Tuesday… The Woodlands said it has faced declining revenues for years and has been operating at a financial loss for some time.

“Right now, with the numbers the way they are, the market the way it is, it just won’t work for them, but we do continue to have a dialogue with them,” Van Petten told reporters.

As it stands, Kansas would take in 60% of the slots revenue, 40% to the state and 20% to the local government and various operations, and the track would take in 25% with the remaining 15% to be negotiated.  However, Forbes explains why even a deal to give the entire 15% to the track may not be enough:

Van Petten said the state will allow the Woodlands to have the entire 15 percent, but the Woodlands says it still won’t have enough revenue to cover its costs and give it a reasonable profit. Van Petten said the Lottery is looking at other options to help the Woodlands, including reworking the costs of oversight and regulation, which the Woodlands must pay.

“I don’t think we can go in and ask them to invest the millions of dollars it will take to get an electronic gaming facility up and running and continue to lose money,” Van Petten said. “So we continue to work with them to look at any possible way to get a better deal for the state of Kansas and keep these race tracks viable.”

Another possibility is asking the Legislature to rewrite the law to give the Woodlands a bigger percentage. However, some are concerned about a possible push to repeal the gambling law if the subject were reopened.

With a slumping economy, competition from surrounding casino’s, a market that doesn’t seem willing to support tracks and the fear of repealing current gambling laws should there be an attempt to legislate a solution with The Woodlands, it seems like a dim possibility of saving the track.


Ex-NBA referee sentenced in gambling scandal

Former NBA referee Tim Donaghy pled guilty to federal felony conspiracy charges alleging that he passed along inside information on NBA games.

Donaghy also alleges that referees helped alter the outcomes of games during the ’02 and ’05 postseasons.

According to the Associated Press and ESPN.com:

Disgraced ex-NBA official Tim Donaghy admitted that he’d brought shame on his profession Tuesday as a federal judge sentenced him to 15 months behind bars for his participation in a gambling scandal that still has the league on the defensive.

U.S. District Judge Carol Amon sentenced Donaghy to prison time, plus three years of supervised release, saying he’d let the sport down by taking thousands of dollars from a professional gambler in exchange for inside tips on games — including ones he refereed.

Mr. Donaghy’s attorney argued that an addiction to gambling motivated the former referee:

Defense attorney John Lauro asked Amon to give his 41-year-old client probation, saying the ex-official was a gambling addict who destroyed “the career he loved” and needed treatment, not incarceration.

What moves the NBA will take to prevent a problem of this magnitude again remains to be seen, but the Commissioner David Stern has been clear that current referees are under a watchful eye and that this incident was simply a “lone” referee. ESPN.com explains:

Case closed for him. For the NBA, the damage lingers.

Commissioner David Stern has made several moves to quell doubts about the integrity of the NBA’s officiating, with more developments to come

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Tim Donaghy Timeline

June ’07: FBI contacts NBA to discuss alleged betting probe
July ’07: Resigns from NBA, investigated as part of organized-crime probe in New York
Aug. ’07: Pleads guilty to two felony charges alleging he took cash payoffs from gamblers and bet on games himself
June ’08: Claims highly controversial Game 6 of the Lakers-Kings 2002 playoff series was affected by actions of 2 of 3 referees who worked the game
July 29, 2008: Sentenced to 15-month prison term (had faced up to 33 months) and three-year term of supervised release
For More Information

Casino Watch Focus – NBA Finals should be about the game and not a wager

AP Video:


House Committee Reviews Study to Legalize Online Gambling

From citizenlink.com:

Rep. Shelley Berkley, D-Nev., will ask the House Judiciary Committee Wednesday to conduct a study on how much revenue the U.S. could generate if online gambling were legalized nationwide.

The study is ultimately designed to challenge Congress’ 2006 enactment of the Unlawful Internet Gambling Enforcement Act, which prohibits the transfer of funds from a financial institution to Internet gambling companies.

Chad Hills, gambling analyst at Focus on the Family Action, said this is a promotion of online gambling disguised as research.

“Should any government – elected by the people, for the people to serve, protect and maintain order – be associated with an industry that exists through the exploitation of human weakness for the sole purpose of monetary gain?” he asked. “Gambling and its negative impacts more serve to decay and threaten our social fabric than to build and strengthen the very threads of society, which consist largely of marriage and the family.”

FOR MORE INFORMATION
Learn more about Internet gambling legislation.


Another Kansas gambling track to close

With the induction of casino gambling, horse and dog tracks around the country have struggled to stay open.  Kansas has attempted to allow tracks to offer slots to help maintain the industry.   Casino Watch originally commented on how  greedy Kansas’ gambling deals were when they allowed a Frontenac, KS dog track to close down because the owner was unwilling to invest all of the money necessary to run a racino and pay a ridiculous 40% gross tax and a 60% effective tax to the state.  Now it looks like the Woodlands will follow suit:

In a statement Tuesday afternoon, Woodlands President Howard T. Grace said that live greyhound racing, Thoroughbred and quarter-horse racing at the track will come to an end Aug. 24.

“The pari-mutuel industry has faced declining revenues for years, and The Woodlands has been no exception, operating at a financial loss for quite some time,” Grace said.

It was believed that once slots at tracks were legalized, the tracks of the state would profit and stay in business.  Instead, Kansas’ greed and addiction to gambling revenue has pushed one of the states most recognized tracks out of business.


BIA ruling attempts to limit Tribal Gaming

Tribal Gaming’s complexities range from which games can be offered to what who is involved in their regulation. In the last year, there have been numerous documented cases of tribes attempting to build casinos hundreds of miles away from their people. The 1988 Indian Gaming Regulatory Act allows for these off-reservation casinos, but in January the U.S. Dept of Interior denied a claim to build a casino 293 miles away from the reservation explaining the casino was too far to be of benefit to tribal members. Since that time, the Dept. of Interior has denied similar attempts over 10 times, which begs the question: Just how far off the reservation is permitted by law and how far is too far? Now it appears the Bureau of Indian Affairs (BIA) has an answer:

The U.S. Bureau of Indian Affairs has published a rule that says casinos should be located within 25 miles of a reservation headquarters.

But the rule has exceptions. Tribes may seek reservation status and permission to operate casinos on newly acquired land away from a reservation if tribes can show that a significant number of tribal members live nearby, can demonstrate a current connection to the property or if other tribal government facilities have been located on the land for at least two years before an application is filed for new reservation land.

With out question there will still be plenty of legal challenges, as tribes will attempt to meet the rule’s qualifications for off- reservation casinos. However, this ruling is encouraging as it helps to weave together a patchwork of rules and regulations that go back over 15 years. In a time when casino companies will approach any tribe to seek to expand their gambling business, and attempt to locate it anyplace they feel provides market support, its nice to see the BIA viewing the issue in more reasonable terms.


A Loss Limit lesson – How the Missouri lottery demonstrates there are no winners, only losers

Casino Watch has explained what happens when you tie money for education to gambling: sometimes you see extra revenue go to schools but most of the time an elaborate shell game is played where the money never really reaches the intended target.  The Missouri Lottery was established with promises of money going to schools but where is the money going?  State Rep Belinda Harris of Hillsboro has been asking the same question:

With educational costs rising and the budget seemingly shrinking, people want to know if schools are really benefiting from gambling in Missouri, said state Rep. Belinda Harris, D-Hillsboro.

Harris believes that when people voted for gambling in Missouri, they were expecting to see larger amounts of cash flowing into their local schools, as is the case in Nevada and Mississippi, where gaming is much more prevalent.  “I think they feel misled,” she said. “They felt like it would solve the problem of funding education.”

Harris said in effect, education may have lost a little of its state funding when the gaming funds came into play.

Two things happen when money is allocated to education through gambling; general fund money seems to be displaced by the gambling money resulting in no net gain for education, and if less money is gambled away by the state there can be a net loss to education funding.  It is terribly tragic for a government to mandate losers and they will either make losers of the people by subjecting them to the horrors of gambling, or make losers of our children by denying them the money necessary to safeguard their educations.

We should never hold a child’s education hostage to gambling dollars and the initiative petition which seeks to remove the loss limit does just that.  A Yes vote is not a vote for schools, it’s a vote against our schools and it’s a vote against our families.


Yes for Casinos First!

Its been well documented that the driving force behind the effort to remove the $500 loss limit by means of initiative petition is being financed by the casino industry. The group calls themselves Yes for Schools First yet they have received no financial support from any educational system in the entire state. The St Louis Business Journal explains:

Casino companies Ameristar Casinos and Pinnacle Entertainment each donated $250,000 in the second quarter to a group working to quash Missouri’s gambling loss-limits law, according to a filing Tuesday with the Missouri Ethics Commission.

The Missouri Gaming Association also gave $12,948 in in-kind donations to the Yes For Schools First Coalition, the group lobbying for a November referendum to end the state’s loss limit of $500 per two hours of gambling, according to the filing.

To date, Ameristar (Nasdaq: ASCA), which has a casino in St. Charles, has donated $1.21 million to the coalition, and Pinnacle (NYSE: PNK), which owns Lumière Place and President Casino in St. Louis, gave $1.19 million, according to the filing.

So even in the latest round of financial contribution to the coalition, Ameristar and Pinnacle provided another $500,000. The only other money being contributed is from the Missouri Gaming Association who lobbies for casinos. Lets just call this campaign what it really is; a deceptive, pro casino effort to expand gambling. Its should more appropriately be called – Yes for Casinos First!

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Story Links

STL Today – Political Fix: Casinos making big wager on push to end gambling limits

The Turner Report – Casinos pour money into loss-limit measure