Editor's note: The U.S. Supreme Court on Monday will take up a case that could make sports betting widely available. New Jersey is challenging a federal law that bars states from authorizing sports gambling. A decision is expected by the end of June.
On Oct. 22, The Advocate published the following story on Louisiana casino gambling laws and the possible impacts in Louisiana if the high court decides in favor of New Jersey.
After a bitter name-calling debate in 1991 that pitted arguments of “good and evil” against practical economics, Louisiana legislators haven’t revisited the laws governing casino gambling.
But that’s about the change.
And the state’s iffy financial stability is once again nudging lawmakers to poke at that hornet’s nest.
“Our laws are antiquated. They need to be updated if we want to keep up,” said Republican state Sen. Ronnie Johns, whose Lake Charles district has three of the state’s 15 riverboat casinos.
The Riverboat Economic Development and Gaming Task Force is working on that, though no decisions have been made — and won’t be until January. Still, Johns takes great care to repeat, over and over again, that any new legislation introduced for the session that begins March 12 won’t expand gambling.
The riverboat casinos may move on land into larger gaming spaces, but no more licenses will be issued and no new casinos will be opened, Johns said. The task force is looking at what needs to be done to update laws so that Louisiana casinos can stay competitive with Mississippi and with new native American facilities in Oklahoma that are drawing off Dallas-area customers from the Shreveport casinos.
Johns points out that in 2016, revenues from riverboat casinos, and the state’s sole land-based gambling house in New Orleans, as well as the lottery, slot and video poker machines brought in $906 million in 2016. Mineral-related severance taxes and royalties kicked in $581 million.
“This is a serious industry now, and we have to look at it with an eye toward economic development,” said Ronnie Jones, a former state trooper who heads a task force and the regulatory Louisiana Gaming Control Board.
After a quarter century, casino operators have a long list, like expanded internet gambling, but what they really want is to get off the riverboats and onto dry land on gambling floors larger than 30,000 square feet. They’d also like to remove the taxes on the promotional money that casinos send out to entice gamblers into their brick-and-mortar establishments.
And just as Mississippi has, Louisiana casino operators would like to start the ball rolling on sports betting if the U.S. Supreme Court rules in favor of New Jersey in Christie v. NCAA.
Raising a “states rights” argument, New Jersey says Congress overstepped its authority in 1992 by passing a law that banned bookmaking — the federal lawsuit also makes many of those football pools illegal — for sporting events.
Only Nevada can take a wager on a single game. Delaware, Oregon and Montana can do bets on the outcomes of multiple games.
Hoping to strengthen Atlantic City’s struggling casinos, and get a portion of the estimated $150 billion bet illegally each year, New Jersey voters approved laws that would allow sports wagering. The five major athletic associations and leagues filed a lawsuit to stop them.
The high court hears arguments on Dec. 4 and could decide the case as early as April, said Sara Slane of the American Gaming Association.
In the meantime, the trade group is working up some model legislations to help states open bookmaking operations, should the high court decide in favor of New Jersey. A favorable ruling would effectively overturn the Professional and Amateur Sports Protection Act, Slane said in an interview.
“We’ve heard from every CEO in Louisiana and, almost to a person, they say that if sports bookmaking becomes legal, Louisiana should get in the game as soon as possible,” Jones said.
B. Mike Whitemaine, senior vice president of Eldorado Resorts Inc., which owns a casino in Shreveport, said sports betting would help attract new customers. In Nevada, those players show up at the casino to watch the games, buy a meal and a few drinks, and maybe gamble a bit.
Kicking at changing the laws overseeing Louisiana casinos is still a touchy subject.
The Rev. Gene Mills, who heads Louisiana Family Forum, the powerful conservative Christian advocacy organization, said Saturday that he “very likely” would oppose the changes.
Though they testified before the little-followed task force hearing, casino managers didn’t want to discuss the plans, at least not with a reporter.
To be fair, however, the governor’s executive counsel had nothing to say after three days of requests for comment. And the usually loquacious Attorney General Jeff Landry, who signed a brief supporting New Jersey’s position before the Supreme Court, left it to his spokeswoman to issue a statement: “A favorable decision for New Jersey does not upend or repeal any law here in Louisiana or elsewhere. Some states may support the expansion of sports betting, while others oppose it.”
About the only law that has been changed in 25 years is the one requiring the riverboats to actually sail. That hasn’t happened since April 1, 2001.
Johns, shaking his head, recalled that the Golden Nugget, the last casino to open in Louisiana using the last available license, basically dredged a slew from Bayou Contraband in Lake Charles, built a barge structure to put the gaming floor with 75 table games and 1,600 slot machines over water, then put up a resort around it with 1,091 hotel rooms in a 25-story tower and an 18-hole golf course. But the casino has to have a paddle wheel, a pilothouse and a crew.
“It’s ridiculous,” Johns said, shaking his head. “It’s sitting on a mud flat to make it legal.”
Tilman Fertitta, president and chief executive officer of Fertitta Entertainment Inc. and owner of the $900 million facility, pointed out in testimony that Louisiana became the fourth state in the nation to allow gambling, and the way was through riverboats. Today, with 40 states allowing gambling, Louisiana is one of the last few clinging to the old riverboat model.
For riverboat casinos that actually sailed at one point, a whole new set of problems have emerged.
Marty Brown, general manager of the Belle of Baton Rouge, testified that the casino hires divers to check and maintain the hulls. When the river rises, Brown has to deploy workers to remove trees and other flotsam that jams the boat.
Brown’s boss, Anthony Rodio, chief executive officer and president of Tropicana Entertainment Inc., has a 45,000-square-foot atrium that the Task Force's Jones agreed was probably the most under-utilized space in downtown Baton Rouge as it sits largely empty most of the time.
In order to attract new, younger customers, casinos have to offer more games, like sports betting. They also want a more immersive experience: surround sound, graphics, more comfortable seats. The newer slot machines are much bigger, which forces Louisiana operators to choose between placing five of the newer machines or eight of the older slots.
“As the current base of players matures, what appeals changed. Younger players want something more than traditional slots,” said Peninsula Pacific Chairman M. Brent Stevens.