A video poker machine display reads out of service inside Treasure Island during the COVID-19 government mandated shutdown, Thursday, April 9, 2020.
Monday, April 13, 2020 | 2 a.m.
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As small businesses are hit with the brunt of the shutdowns brought about by the coronavirus pandemic, one industry also has been frozen out of economic aid from the federal government: gaming.
The Paycheck Protection Program included in the most recent coronavirus stimulus package approved by Congress does not apply to businesses that make more than one-third of their revenue from gaming, a decision that has led Nevada’s congressional delegation and the gaming industry as a whole to put pressure on government officials to change the decision.
“In addition to gaming’s considerable needs to pay and provide for our own direct workforce, the gaming industry also supports 350,000 small-business jobs,” American Gaming Association CEO and president Bill Miller wrote in a letter to President Donald Trump. “Making Small Business Administration resources available to size-eligible gaming businesses is the right thing to do. As it stands, the policy discriminates against these mainstream businesses and, more importantly, the hundreds of thousands of employees who rely on gaming for their livelihood.”
The Paycheck Protection Program, funded by the SBA, is a portion of the Coronavirus Aid, Relief and Economic Security (CARES) Act that gives small businesses forgivable loans amid the COVID-19 outbreak. The loans, available to most businesses with under 500 employees, are forgivable as long as they are used on “payroll costs, and most mortgage interest, rent and utility costs over the eight week period after the loan is made.”
Christina Ellis, director of marketing for Ellis Island, said the business is watching and waiting for a potential fix to the problem.
“Right now we’re just patiently waiting to see what our Nevada U.S. senators and House representatives do to rectify the situation with our state’s small gaming businesses,” Ellis said. “We’re hoping it was just an oversight on their part, and that they will rectify the situation. It will make a tremendous difference to our employees.”
According to the AGA, 95% of the country’s commercial casinos have shut down due to the spread of the virus, and 83% of the country’s tribal casinos have done the same.
Democratic Nevada Rep. Susie Lee, whose district takes up most of Henderson, said that exclusion was likely just cut and pasted language from the 2009 stimulus package, which did not help gaming companies. Lee sent a letter Tuesday to the SBA and Treasury Secretary Steve Mnuchin stressing the importance of the program. In a recent interview, she said the help is needed for employees and that widespread legislation such as the stimulus package can often have “glitches.”
“The statutory intent was not that,” Lee said. “(The intent) was that all small businesses, regardless of where they receive their revenue, would be eligible for the PPP because the intent of the legislation was to protect employees,” Lee said. “It’s particularly important here in Nevada because we do have a pool of small businesses who derive some of the revenue from gaming.”
Lee is not alone in pressing for aid for gaming businesses. Sen. Jacky Rosen, D-Nev., led the state’s congressional delegation in a public stance against the exclusion of these businesses, including a letter to congressional leadership saying it goes against the intent of the measure.
“Many of our casinos – including hotels – are small businesses, and they employ many tens of thousands of employees across our state, making up the backbone of Nevada’s economy. These small businesses are located in both our large urban areas and rural communities,” the delegation wrote.
“Furthermore, many Nevada small businesses such as restaurants, bars, grocery stores and convenience stores operate gaming equipment and derive revenue from it. Our state is also home to a large number of small businesses in the gaming equipment manufacturing industry.”
Rep. Steve Horsford, D-Nev., whose district takes up much of North Las Vegas, said the delegation was attempting to get the Treasury to issue a guidance to make those businesses eligible rather than having to tackle the problem legislatively. If legislation is warranted, he said, he would push House leadership to include that language in future stimulus packages.
“Our goal is just to have it done administratively, so that there’s no additional legislation that’s warranted,” he said. “President Trump has indicated — I’ll give him credit where credit is due — that these are businesses that should be eligible for this program and he has indicated he has a willingness to include them.”
Trump said Wednesday he would “take a look” at the legislation.
“I understand what they mean,” he said.
Gov. Steve Sisolak, in a Wednesday press conference, said that there was no difference between small businesses that receive some money from gaming and those that do not.
“(The industry) is a big employer of ours, obviously,” the governor said. “When we turn the lights (off) on Las Vegas Boulevard, 200,000 people were unemployed. A lot of the locals’ restaurants, bars, whatnot that have gaming devices in them are affected likewise, and I think they should be offered the same support.”
Lee said that if the SBA did not change the guideline themselves, the delegation would work to fix the legislation in future stimulus bills, which are already being discussed in Congress.
“We’re continuing the pressure and making sure that everyone knows about this and trying to get some resolution to it,’ Lee said. “Ultimately, these are small businesses that have bills and that are hoping to be able to rehire their employees, so we’re fighting to make sure we get that funding to them as quickly as possible.”
