Legislative Outlook 2006

As many of you know, this past year marked the 10th anniversary of the American Gaming Association (AGA), and throughout our history, we have served as the voice of the commercial casino industry in our nation’s capital.  2005 was one of the most challenging years for our industry in recent memory, and several legislative and regulatory issues raised in 2005 will continue to have an impact on gaming companies in Nevada and across the country in the new year.

The legislative agenda in late 2005 understandably was dominated by efforts to pass business tax relief provisions for the Gulf Coast region devastated by Hurricanes Katrina and Rita.  Congress last month approved the Gulf Opportunity Zone Act of 2005, which clears the way for rebuilding efforts along the Gulf Coast to begin in earnest.  Helping our industry fully recover from these twin disasters has been and will continue to be a key priority of the AGA in the coming years, and I am confident our industry will prevail in returning to even greater glory the communities along the Gulf Coast that have come to depend on us for their livelihood.   

Another issue in the news quite a bit last year was internet gambling, and the AGA will continue to monitor legislation related to the topic in 2006.  Congressman Jim Leach (R-IA) recently introduced legislation in the U.S. House of Representatives to prevent the use of certain payment instruments, credit cards, and fund transfers for unlawful Internet gambling.  Leach’s bill is identical to draft legislation recently introduced by U.S. Sen. Jon Kyl (R-Ariz.), which failed due to procedural objections. 

Leach’s and Kyl’s approach is similar to bills from the 108th Congress, which would have prohibited the use of financial instruments in Internet wagering transactions.  The new legislation is characterized as an “enforcement bill” that gives certain state and federal law enforcement agencies the tools to combat illegal, off-shore Internet gambling.  Previous versions broadly defined Internet gambling, while the latest bill specifies that current statutes, such as the Wire Act of 1961, would have legal authority over the practice.  This bill will allow intrastate Internet gambling with certain restrictions, as well as ensuring that the horseracing industry can continue simulcast and account wagering. 

On other legislative and regulatory fronts, after years of attempting to ban betting on college sports in Nevada, the NCAA said last year it now regards the gaming industry in Nevada as a partner in helping to ensure the cessation of illegal wagering on college sporting events, and the AGA has reached out to begin building a strong working relationship with that organization. 

Additionally, the AGA has worked with member companies, the Access Board and the Department of Transportation to evaluate the effects of proposed rules that would update the Americans with Disabilities Act (ADA) Accessibility Guidelines for Transportation Vehicles, which affect large passenger watercrafts including riverboat casinos in several states.  The AGA submitted comments to the Access Board, which has expressed an interest in working with the AGA to tailor specific guidelines for the riverboat gaming industry.  

On the homeland security front, the AGA continues to monitor and address new developments on the issues surrounding suspicious activity reporting and terrorism risk insurance.  Congress recently passes the Terrorism Risk Insurance Extension Act of 2005, which increases the amount of property and casualty losses that would trigger federal payments, as well as raises industry deductibles and co-payments and increases the financial stake of insurers. 

Additionally, the bill calls for the President’s Working Group on Financial Markets (comprised of the Secretary of the Treasury, and the chairmen of the Board of Governors of the Federal Reserve System, the Securities and Exchange Commission, and the Commodity Futures Trading Commission), in consultation with a variety of stakeholders, to conduct a study on the long-term availability and affordability of terrorism risk insurance including coverage for nuclear, biological, chemical and radiological events.  The working group is required to report its findings to Congress by September 30, 2006, and the AGA will continue to monitor progress on this issue throughout the year.

Another issue that could have major implications for the gaming industry is smoking.  In the face of efforts in nearly every gaming state to ban smoking in public establishments, including casinos, the AGA continues to emphasize our support of reasonable, science-based solutions to indoor air quality concerns.  We continue to work closely with the American Society of Heating, Refrigerating and Air Conditioning Engineers, a standards-setting organization, on the issue, and are monitoring technological advances that could lead to effective air quality solutions that both protect the health and welfare of our customers and are mindful of our business concerns.

The AGA also is monitoring ongoing activities in Washington related to Indian gaming, depreciation of casino equipment, potential new withholding rules for poker tournament winnings, and more.

As the AGA enters its next decade, we do so as the voice of an industry that has seen its fair share of challenging times but has emerged more united, stronger, and with more opportunities than ever.  Despite this growth, Nevada remains the epicenter of our industry, and I look forward to continuing to champion the interests of this state’s gaming industry in 2006 and beyond.