Gaming Commission works to limit neighborhood slots

CARSON CITY -- The Nevada Gaming Commission, talking since 1996 about limits on small businesses with slot machines, unveiled a proposed regulation Thursday and it ran into immediate objections.

"It's a vicious regulation," says James Avance, representing Cardivan Co., a slot machine firm. "It eliminates competition."

The commission said it "intends to address the proliferation of gaming into new types of businesses." There have been applications to place slot machines in places ranging from doctor's offices to car washes to fast food restaurants.

The proposed regulation applies to restricted locations, or those with 15 or fewer slot machines. For restricted licenses, slot revenue must be incidental to the money that comes from the primary business.

Avance said Commission Chairman Bill Curran, the force behind the proposed regulation, should not be pushing it at "this time in his career." Curran's term on the commission ends in April.

Because of questions and uncertainties, the commission agreed to hold a full-day hearing in Las Vegas, tentatively set for March 26. Curran said he "wants to get the project done."

The regulation would require new grocery and drug stores to segregate slot machines in alcoves. And automated teller machines would be prohibited from these areas. The original draft of the regulation would have prohibited smoking. But slot machine representatives said the present law allows smoking in licensed gaming businesses and the commission is exceeding its jurisdiction.

Advertising by these businesses about their slot gaming would be limited. Curran said he was bothered by small businesses with slot machines having large signs advertising they are casinos. He said that indicates that gaming is not incidental to the business, which is required under the regulation.

Attorneys Bud Hicks and Sean Higgins, representing the Nevada Retail Gaming Association, said a ban on advertisements might violate the constitutional right of freedom of speech.

Both told the commission it should continue to decide on a case-by-case basis licenses for small businesses, rather than adopting the regulation.

Commissioner Sue Wagner indicated she will try to restore a smoking restriction in the regulation in the slot alcoves at grocery stores and drug stores. Commission Brian Sandoval said he wanted some restrictions on slot machine tournaments in these small business put back in the regulation. It had also been removed.

In mid-afternoon Thursday, Curran gave up trying to reach a consensus. He noted there was a major storm moving into the Carson City area and many people had to catch planes to Las Vegas.

After the hearing, Hicks, whose organization includes slot machine route operators, said the regulation "would limit the ability of businessmen, route operators and property owners to participate in the gaming industry. You have thousands of Nevada citizens out there who own or run businesses who participate in the gaming industry."

While these operations would be "grandfathered in" under the proposed regulation, Hicks said it would limit future business opportunities.

"This is not a doomsday regulation but it puts more limitation on small business people," he said. And he added it would create a two-tier system. The ones who already had licenses would not be subject to restrictions and new operators would be limited.

The regulation says a business will not get a restricted license unless it shows the slot take is "incidental" to the main business. But exempt from meeting this requirement are grocery and drug stores of more than 6,000 square feet; convenience stores of at least 1,200 square feet and bars and taverns.

The regulation, which was revised Thursday after a meeting between gaming commission attorneys and lawyers for the industry, said smoking would be permitted in gaming areas of grocery and drug stores but the area "must be ventilated in a fashion so that the tobacco smoke is substantially removed from the primary business or otherwise purified." The initial regulation said unsuitable advertising would include mention of "slots" or "casino" or "video poker." The revised regulation said it would be grounds for disciplinary action for "materially misleading" advertising.

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