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Neighboring states hedge bets to offset lure of Oklahoma casinos


Scott Cooper June 4th, 2009

The explosion of tribal casinos is clearly aiding the state government's bank account. According to figures from the Oklahoma Office of State Finance, the current fiscal year totals already ...

The explosion of tribal casinos is clearly aiding the state government's bank account.

According to figures from the Oklahoma Office of State Finance, the current fiscal year totals already surpassed the previous year's record total gaming income with still one month to go. For fiscal year 2009, the state has raked in nearly $95.5 million from more than 100 casinos. That's almost $14 million more than fiscal year 2008.

TRAVELING DISTANCE
LEGISLATIVE FIGHT
CASINO QUESTION

But to really see the impact of Oklahoma's casinos, observe the state's neighbors. Tired of losing their residents' dollars to Oklahoma's gambling allure, Texas, Arkansas and Kansas are feverishly working to get their own casinos.

"Yes, that is part of the story," said Michael Wasserman, a Texas developer who is leading the effort to bring casinos to Arkansas. "My big concern is tourism. Arkansas use to be a place everyone wanted to come to, but now it's lagging."

TRAVELING DISTANCE
According to the state tourism department, visitors to Oklahoma's casinos average a traveling distance of 55 miles. That may not sound like much, but consider there are 40 casinos inside counties which sit along a neighboring state's border. Folks heading to Dallas may stop at the Chickasaw Nation's mega WinStar World Casino, just a poker chip throw away from the Red River. The WinStar is undergoing a renovation and is now the third largest casino in North America and the fifth largest in the world, according to tribal officials.

The Chickasaw Nation tribe denied an interview request.

"We are positioning ourselves to compete with major cities across the country, not just Texas and the surrounding states," said Bill Lance, CEO for the commerce division of the Chickasaw Nation, in a statement.

Texans for Economic Development reported nearly 20 percent of Oklahoma's gaming revenue came from Texans in 2007.

However, pro-gamblers are finding the road to casino glory even more difficult than Oklahoma's path a few years ago. Again, it's a battle between morality and economic development.

Kansas decided the best way for gambling dollars to flow in was to have the state government run the tables. In 2007, the Kansas Legislature approved a measure that allowed four casinos to be created at specific sites. The state would own the casinos but rely on the private sector for construction and management.

"Our governor and many legislators have presented the Kansas Expanded Lottery Act (KELA) as a way to keep Kansas dollars in Kansas, as well as attract out-of-state dollars to Kansas," said Sally Lunsford with the Kansas Lottery. "Those advocating for KELA felt that Kansas was, perhaps, having to deal with some of the potential problems caused by casino gambling, while not receiving any of the benefit."

LEGISLATIVE FIGHT
The legislative fight for casino approval took as many twists as Dorothy and Toto experienced. Republicans control both the House and Senate, but the casino backers knew if they could get a bill out it would be signed by the then-Gov. Kathleen Sebelius, a Democrat now serving as U.S. Health and Human Services secretary.

After 12 hours of debate, the House narrowly approved the measure. A few days later, the debate moved over to the Senate, where anti-casino lawmakers took a gamble and lost.

The Senate bill was being held up by the Republican leadership who were trying to kill the bill by moving it to a conference committee instead of holding a vote. But one Republican senator motioned to adopt the House bill in hopes of getting a majority of "no" votes and defeating the gambling cause. Then gambling supporters mounted a filibuster, forcing the leadership to concede. The measure was approved 21-19.

The new law created four gambling zones across six counties, some of which border Oklahoma. County voters would have to approve any new casinos through the ballot box. The bill also allowed for slot machines at the state's existing horse and dog race tracks. But that's it. The bill bans any other expansion for 25 years.

So the hurdle has been cleared. No more Kansas dollars trekking to Oklahoma casinos, right? Well, not quite.

As Kansas moved toward casinos, Oklahoma was continuing its upward climb of gambling locations. The Quapaw Tribe recently constructed a $300 million casino resort just 65 feet from the southeast Kansas border, opposite one of the state's casino-allowed counties. When news of the resort reached one of the Kansas casino developers, they reportedly pulled out, saying their casino would not be able to compete with the Quapaws.

Kansas officials are hoping to open the state's first casino this fall.

At least Kansas is getting a casino " Arkansas and Texas are still shut out. Both of those state legislatures, as well as their governors, have resisted the temptation as gambling forces intensified.

CASINO QUESTION
In Arkansas, a petition is about to be circulated to put the casino question to a vote of the people. Led by Wasserman, the pro-gamers hope to place the question on the November 2010 ballot.

Only the horse tracks in Hot Springs and West Memphis allow gambling. Last year, voters did approve a state lottery. But some Arkansans have seen firsthand what casinos " like the Cherokee Nation sites just west of Fort Smith, Ark., and another in West Siloam Springs, as well as the Choctaw Casino in Pocola, also close to the border " can do.

"Why is there a casino right across the border? It's because they're trying to attract Arkansas gamblers, otherwise there wouldn't be one right there," Wasserman said. "They've found a market there and gone after it."

Should voters approve the petition, casinos would be allowed in seven Arkansas counties, including Sebastian County, where Fort Smith resides.

While optimism may be glimmering in Kansas and Arkansas, Texas is being left in the dust. This year's Texas legislative session came to end with all efforts for expanded gambling defeated.

For the Lone Star State, the governor's the main obstacle. Legislators had enough votes to pass a constitutional amendment to legalize casinos, but couldn't come up with votes to override a veto threat from Gov. Rick Perry.

But other forces have thwarted gambling supporters in Texas as well. The Texas Observer magazine reported a struggle developing between horse track owners, tribal leaders and casino operators, as each wanted concessions none of the entities could live with. The magazine also reported casino lobbyists in neighboring states helped to defeat gaming legislation.

So for now, all Texas gamblers can do is play the ponies at the racetracks or try the state's lottery. Meanwhile, those Texans who want more action can probably be found at the WinStar.  "Scott Cooper

 
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