Time for Nevada gaming to restack the regulatory deck?

Time for Nevada gaming to restack the regulatory deck?

February 14, 2017 3:00 AM

Every two years Nevada suffers the mad rush of activity around the state legislature, where the generally well-intended legislators try and rush through laws and budgets in their narrow window between February and June to take care of the needs of Nevada till the next session.

Sometimes the laws are well reasoned and serve critical needs and sometimes they are just odd and interesting larks, like the proposal to have an official state cocktail.

For the gaming industry though the legislative session is a chance to change paradigms and revise state policies by taking the combined industry and regulatory experiences of the prior two years to gaze ahead and request changes to keep Nevada on the leading edge. This is so important Nevada gaming regulators are reserved a bill to assure an opportunity to advance the state’s interest in each legislative session.

As technology is advancing so much and new variants of wagering, such as eSports and fantasy sports, have been born out of that technology, there were some expectations the gaming regulators’ bill would contain some wise, learned and forward looking requests for policy or statutory changes. After all, the Nevada Gaming Policy Committee met numerous times and covered matters ranging from fantasy sports to eSports to technology to cross border wagering pools with many a nodding head, not from sleep, but agreement that the world via technology is changing and Nevada needs to stay out front.

Against this backdrop there were high expectations proposed gaming bill AB75 would make wise requests for changes in policy or statutes to both protect and advance Nevada’s gaming industry in the areas of technology, gaming expansion, dealing with legal marijuana and possibly even enhancing the criminalization of malicious cyber activities related to gaming.

Disappointingly, the bill only really requested approvals for three things: 1) if you are a game manufacturer and created a game, instead of getting licensed in Nevada, if an existing licensee in the right category takes full responsibility for the product you may not have to get licensed. 2) the Board instead of the Commission can decide which manufacturers are to be required to file a gaming application. 3) the Chairman of the Gaming Control Board, without oversight, can launch any confidential investigations he so desires as long the investigation is paid for by money from any source other than the State General Fund.

Nothing about reconciling the dictates in the marijuana legislation requiring the state to treat marijuana like liquor, while gaming regulators insist Nevada gaming operators treat it like the Black Plague. Nothing about cyber security for gaming in the changing tech world or expanding the penalties on “bad actors” who use technology against casinos was to be found in the bill. Not even a token reference to the good work from the Gaming Policy Committee.

In speaking to a few past NGCB members about the proposed bill, while each requested anonymity as they all in some form or another still do business with Nevada regulators, they generally expressed support for anything that quickens the process of getting gaming products on the casino floors but they also expressed concern about the continuing diminution of the role of the Gaming Commission and lack of protection for the industry on various topics like marijuana.

Noting a trend in both legislation and regulations over the last several sessions to increase the independent approving authority by the Control Board chairman in place of the Gaming Commission, a former NGCB member begged the question about where the oversight on the Board chairman is and what is even the remaining purpose of having a Nevada Gaming Commission.

I asked what he thought should be done. He suggested it may be time to do away with the three-member NGC Board and appoint a Director instead that reports to a three person commission rather than the current five. Take all the areas that require Board chairman approval and give them to the Commission chairman and go to one public meeting instead of two each month.

He suggested this would save around $500,000 a year alone in compensation and benefits and probably twice that in costs of travel, staff time and other related costs while reducing time turn around on required actions yet providing for greater continuity in gaming policy and practice.

Perhaps as the legislative session matures, the gaming bill will see a few amendments addressing some of the above topics but regardless, let’s hope no matter its final form the final passed bill provides for expanded opportunities to the gaming industry while maintaining proper “checks and balances” on both regulators and industry!