Deficit could give video poker operators chance to ante up
Posted May 29, 2009
Raleigh, N.C. — Two years after lawmakers forced the video poker industry to fold in North Carolina, gaming operators see the growing budget deficit as a chance to deal themselves back into the game.
The Entertainment Group of North Carolina, a coalition of video gaming businesses, is launching a television ad campaign this weekend to build momentum for bringing back the games.
"There's real money on the table and the legislature needs to take a look at it," said Brad Crone, a consultant to the group.
Video poker machines hold a tarnished place in state history. Sheriffs loathed them because they had a hard time policing illegal payouts to players, and an investigation into former House Speaker Jim Black's ties to the industry eventually brought him down on public corruption charges.
The General Assembly voted three years ago to phase out the games by July 2007. The legislation exempted the video gambling machines at the casino run by the Eastern Band of Cherokee Indians in western North Carolina.
A judge tossed out the video poker ban in February, ruling the state couldn't allow the games in the Cherokee casino while outlawing them elsewhere. But the ban remains in place while the state appeals the decision.
Crone said North Carolina doesn't get a cut from video poker on the Cherokee reservation, but putting the machines back in convenience stores could generate needed revenue for the state.
"If you legislate video gaming in North Carolina and tax it (at) 20 percent, you could generate $480 million," he said.
He said that money could eliminate the need to furlough state workers or shorten the public school calendar – remedies to the budget deficit floated by Gov. Bev Perdue and lawmakers.
Chris Fitzsimon, director of North Carolina Policy Watch, a progressive think tank, said he's disturbed by talk of video poker returning, especially the possibility of legitimizing the games by letting the North Carolina Education Lottery control them.
"Putting video poker in the lottery, I can't think of anything worse for the people of North Carolina," Fitzsimon said. "It's amazing to me at this time (that) one of our solutions would be to prey on people to raise money instead of raising taxes honestly and making budget cuts."
Lottery Executive Director Tom Shaheen said he has no official opinion on adding video poker to the lottery.
Rep. Earl Jones, D-Guilford, filed a bill two months ago to legalize video poker and cut the state in for 20 percent of profits from the machines. House Bill 1537 never made it out of committee, and the idea faces stiff legislative opposition.
Senate Majority Leader Tony Rand said he opposes bringing video poker back – with or without lottery supervision.
Some store operators also said the cash they would make from video poker isn't worth the trouble.
"It's not a good idea," said Aref Peroz, who runs Peace Street Market in Raleigh. "There's no room for extra people to stand around gambling all day long."