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Allure of slots has politicians reeling!

Feb 11, 2003 7:53 AM

Being Las Vegas is not as easy as it looks.

Ask Atlantic City, where a slum remains behind the glitz and façade of the Boardwalk.

Ask George Pataki, the governor of New York.

Ask Robert Ehrlich Jr., the new governor of Maryland.

Ask Ed Rendell, the new governor of Pennsylvania.

All three gentlemen have discovered that being even a little tiny part of Las Vegas is not easy.

All three are trying to copy the city’s success by introducing video lottery terminals, the politically correct way to refer to slots these days. And all three are discovering that there are people and problems out there that complicate the task.

In New York, state government is run by a trio, not by Pataki alone. He is the smiling governor, but two unsmiling colleagues share in running the place. One is Joe Bruno, the all-powerful majority leader of the Senate, and the other is Sheldon Silver, the strong speaker of the Assembly. Nothing happens in New York state until those two sign off on it.

Last year they signed off on slots to save the state’s racing industry. Then they turned the details over to the lottery commission, and there was chaos unfettered. That commission came up with a Catch 22 that told the tracks, in essence, "You can have slots, but with rules that will make sure you can’t have them."

The rules were: 12½% of the revenue; you build the casinos yourself; and do it with a sunset clause that could end the deal in five years.

Ask some of the movers and shakers of Vegas, from Steve Wynn down, if you can build and get financing with those terms and conditions. The answer is No.

So the tracks told George and Joe and Sheldon they couldn’t go forward with the grand plan on those terms.

A few weeks ago George, realizing they were right, eliminated the sunset clause. But he proposed a new split which left horsemen out of the split entirely, giving them zero ”” zip ”” for the first two years, then graduating their share from 10% in the third year to 20% after 10 years. Before that, they were to get 35% in the first year, 45% thereafter.

The screams on the backstretches of New York could be heard over the din of the slots and roar of planes at McCarran Field. Even Barry Schwartz, who runs Belmont Park, Aqueduct and Saratoga joined the cry, saying there was no way slots could be introduced with horse owners, trainers, jockeys and drivers left out. The issue is being ”˜reconsidered’ right now.

In Maryland, Republican Bob Ehrlich, who ran on a platform of slots at Maryland tracks and beat a Kennedy doing it, has run into a rebellious Democratic legislature. Everybody wants in the act ”” the city of Baltimore, African-Americans, counties, the tracks themselves, who want more ”” and what seemed like a slam dunk is turning out to be like making a hole in one with a putter.

In Pennsylvania Ed Rendell has not even introduced his slots bill yet, but everybody with a backyard bigger than a tennis court now wants a racetrack in it.

Joe Lashinger, a savvy lawyer who was an executive with powerful Penn National, which has a racetrack outside of Harrisburg and a hugely successful racino in West Virginia, quit that company to seek his own track. He chose Chester, a deeply depressed town south of Philadelphia on the Delaware river, and found a ready local political infrastructure and a site, a former abandoned shipyard. The state harness racing commission scheduled a licensing hearing, but the outgoing governor, Mark Schweiker, told them to cancel it. They were indignant, and scheduled another, and then the new governor, Rendell, told them to cool it and cancel that one too.

Meanwhile everyone from giant Magna Entertainment to a couple that owns a little training track near Pittsburgh wants the one remaining thoroughbred license in Pennsylvania, and Ed Rendell has a problem on his hands before he even plays his first card.

Being Las Vegas, or even a part of it, is not as easy as it looks.