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Nevada considers increased slot-parlor regulations

CARSON CITY — The smaller players in Nevada’s robust gambling economy were the targets of an Assembly bill Monday that would reform the state’s biggest industry by better defining and separating the large casinos from smaller establishments.

The bill aims to more strictly define the minimum parameters of smaller gambling establishments to ensure such institutions are not competing with larger casinos without paying the state as much.

It requires institutions with restricted gambling licenses to have at least 2,500 square feet of space available for patrons, a restaurant that seats at least 25 people and is open at least 12 hours per day, and the first eight slot machines to be embedded in a permanent bar.

“One property may come in and invest a billion plus and theoretically across the street you could buy a warehouse and stuff it with machines,” said Assembly Majority Leader William Horne, D-Las Vegas, who presented Assembly Bill 360 to the Assembly Judiciary Committee. “They haven’t made the same investment, they’re paying less in taxes and, as it has morphed today, they’re competing.”

Nonrestricted licensees are the larger hotel-casinos with multiple gambling systems or more than 15 slot machines. Restricted licensees have 15 or fewer slot machines and no other gambling systems such as mobile gambling or sports betting.

Generally, nonrestricted establishments pay significantly higher taxes and invest more in their buildings, and the smaller shops have higher fees per machine. The main difference is gambling is not supposed to be the primary business of restricted establishments like it is for those that are nonrestricted.

“The reason you have non restricted and restricted gambling licenses is because they’re supposed to be doing different things; they’re not supposed to be competing,” Horne said.

Opponents countered that the restricted establishments often invest nearly the same dollar amount per machine and pay more fees per machine than larger establishments do.

“What you’re saying is, ‘You can be successful, but don’t be too successful or we’re going to come after you and tax you differently,’  ” said Sean Higgins, representing the Nevada Restricted Gaming Association.

He said requiring parlors to embed the gambling machines in the bar prevents them from adapting to a changing economy should betting evolve to tablet or cellphone centered in the near future.

Craig Estey, the president and founder of the popular slot parlor chain Dotty’s, told committee members that many of the state’s most significant early casinos would never have succeeded with today’s stringent regulations.

“I’m not sorry I’m doing a really good job,” he said.

Pete Ernaut, a lobbyist for the Nevada Resort Association, said that it’s a matter of principle and that the Legislature needs to take a stand for fairness across the board in the state’s biggest industry.

“This won’t stop, it will only continue to grow and change. I would contend that now is the time while it’s small to make a decision,” Ernaut said.

Assembly Speaker Marilyn Kirkpatrick, D-Las Vegas, also is one of the bill’s sponsors. The committee took no action Monday, with the deadline for bills to clear the first committee stage Friday.

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