Why Larry Gilbert recommends a NO vote on Prop 94, 95, 96, & 97

There is a better solution for closing the current gap between revenues and
expenditures in Sacramento than the Prop 94, 95, 96 and 97 Band-Aide’s.

After moving to California in the late 70’s we opened a corporate office in northern California. One evening after dinner a customer introduced me to the Garden City Card Club in San Jose. Prior to that visit, where we stood in a smoke filled card room, I had no idea that California had permitted any gambling in the state.

Since that time I have driven past the Bicycle Club and the California Commerce Club in LA County.

Fast forward to the Little Hoover Commission report of April 29, 2002 where Chairman Alpert presented his overview of the law as it relates to these restricted gaming businesses. In Michael’s report he mentions that “within the last five years gambling in California has grown into a $6 billion dollar business.” Mind you the report lists “113 card rooms in California operating 1,473 tables.” He continues stating that “The number of card rooms has declined. As recently as 1998, 176 card clubs were operating 1,883 tables.” As I scan the list of clubs in his report there are 91 with less than 10 tables confirming that most are Mom and Pop operations. As of that time there were no Card Clubs in Orange County. The largest clubs in the state are located in Bell Gardens and Commerce.

There is a key paragraph in the Little Hoover Commission report that references Indian tribes. “The tribes are sovereign governments, while the card clubs are regulated by state and local governments. The federal government has largely defined the parameters of Indian gambling, while the state defines the rules for card rooms. “ The report continues “There is no level playing field. Federal and state policies do not envision a level playing field.”

Let’s not look for a Band-Aid solution to our revenue shortfall. I firmly agree with conservatives serving in Sacramento who have often stated that “we do not have a revenue problem” but instead “we have a spending problem.”

However, that acknowledgment doesn’t fix our current problem. If voters elect to expand the number of slot machines to generate some pie in the sky numbers over the next 20 years, why not bite the bullet and open up all forms of gambling in state. It is widely acknowledged that many Californians travel to Las Vegas and beyond to gamble. While I do not support that vice, we can have the private sector build casino/hotels right here in California. The days of Benjamin “Bugsy” Seagal, who was murdered sixty years ago, are no longer a factor. We should not concern ourselves with fear of organized crime as an excuse to oppose this idea. And while
any new hotels would not be constructed overnight the revenue stream and jobs created in the next decade and beyond could be huge. We surely have a huge plot of land in the middle of the Great Park that would be a great location and a huge success. Seriously there must be several major cities that would welcome an opportunity to share in the wagering revenue now leaving California.

Let’s revise the ownership rules so that every stakeholder does not have to be licensed. We would need to pass a Constitutional Amendment to Article
IV, Legislative, Section 19, letter (e) to remove the “prohibition against casinos of the type currently operating in Nevada and New Jersey.”

In 2005 the state of New Jersey collected over $500 million in casino related revenues. In 2005 their casino’s provided direct employment for 44,542 people.
If the proponents of Propositions 94, 95, 96 and 97 are serious about their TV ads which read “keep the revenue for California” than let’s think outside the box and not limit future revenues solely to 17,000 additional slot machines for four Indian tribes.

While Indian tribes have an exclusive right to have slot machines in our state I would urge a NO vote until we can go back to the bargaining table and renegotiate the Agreement. I might concede giving them 50 percent of all slot machines in the state and permit the private sector to come in and offer the same broad types of games found in other states Casinos, along with an equal number of slots. If not, and we grant these four tribes the authority to add 17,000 additional machines, that would seriously reduce the desirability of Casino owners to directly invest in California. Slot machines typically generate twice the revenue of table games. In effect we have boxed ourselves in. If the policy goal is to generate additional revenue from gambling than think about all the additional visitors we could attract who, in addition to gambling, would add growth to our economy by their visiting major attractions from San Francisco south to LA, Anaheim and San Diego.

Note: This report was drafted prior to today’s OC Register’s Orange Grove by Congressman John Campbell. I am pleased to see that he and I are in agreement as to how to vote on these Propositions as presented.

Focus on the Family has a fact sheet on Indian Gaming which indicates California having the most slot machines in the country as of 2006. That number was 59,670. They also report Indian gambling revenue in our state of $7.2 billion dollars.

In closing. We should not continue granting “exclusive rights” to four “special interests” while members of other Indian tribes go hungry. Vote NO on 94, 95, 96 & 97

As always your comments are welcome.

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