Casino Bill May Face Slew of Amendments

A slew of casino bill amendments may soon be floated after House subcommittees delivered reports Thursday that raised questions and new ideas about regulation, licensing and oversight. 

Suggestions included expanding those requiring background checks, additional criteria for licensure, enhancing authority for the New Hampshire Attorney General, tightening limits on political contributions, and reworking the revenue distribution formula. 

Revenue subcommittee Chairman Neal Kurk (R-Weare) reported the timeline for a casino licensing review could be pushed back by another 11 months. That includes nine months for regulatory review and submissions of requests for proposals, and two months for background checks. 

"We believe that if everything goes well–and that's a big if–it is theoretically possible for the license to be granted on June 28, 2015," Kurk said.

Before the presentations, joint committee Chairwoman Mary Jane Wallner (D-Concord) said all amendments should be filed by the end of Tuesday, May 14. The full committee plans to dig into Senate Bill 152 on Wednesday morning, and vote it out of committee Wednesday afternoon.

The bill, which the Senate passed in March, would legalize up to 150 table games and up to 5,000 video slot machines at one casino. It calls for the Lottery Commission to regulate, license and enforce the video lottery and table games. 

Rep. David O. Huot (D-Laconia), chairman of the House "regulations" committee, questioned the oversight framework for a proposed casino, including the Lottery Commission's role.

"I think," he said, "this is something which might warrant consideration at the highest level of state government."

Rep. Patricia Lovejoy (D-Stratham), chairwoman of the "social impact" subcommittee, said the bill has several weaknesses for communities around a proposed site and for the state at large. Some police organizations have testified that any related-crime from a casino would not be anything more than that of a large shopping mall, but Lovejoy said crime rates for robbery, aggravated assault and larceny spike in the four years after a casino before leveling off.

She also epxressed concern about problem gamblers, impact on charity gaming operators, and the effect on local existing entertainment venues like the Verizon Wireless Arena, Hampton Beach Club Casino and the Capital Center for the Arts.

Charities participating in gaming operations in 2012 would be made whole, but it would shut out charities that did not benefit in that year, she said.

"I'm concerned about the state sort of picking winners and losers," Lovejoy said.

WATCH VIDEOS above of Huot, Kurk and Lovejoy discuss their subcommittee findings May 9. Below are excerpts of the three reports, worded as they were presented: 

"Regulations" subcommittee report:

• Enhance authority for Attorney General
• Comprehensive judicial review process - modeled after PUC and CON
• Clarification of roles of State Police and Legislative Budget Assistant
• Expand those requiring background investigations
• Tighten limits on political contributions
• Coordinate advertising with DRED
• Require final regulations before license issuance.
• Affirm license as a revocable privilege
• Authority and standards for commission to waive time limits and requirements which hinder full and fair competition for the single license.
• Additional criteria for licensure.
• Prohibit ex parte communications during consideration of applications
• Provide for written decision with findings of fact for all discretionary decisions.
• Set standards for temporary operations, including location, and penalties for failure to meet construction timelines.
• Establish ongoing oversight and reporting requirements during tenure of license.
• Provide procedure for conservatorship in the event of license revocation, bankruptcy, or other unforeseen event.
• Clarify interface with charitable gaming, to include underage gambling and presence in gaming area.
• Amend Criminal Code to define and set penalties for gambling-specific crimes
• Clarify enforcement authority of State Police at casino site.

"Community Impact" subcommittee report:

• 18-20 yrs old allowed to gamble in charitable gaming facility but not in casino
• Charities participating in 2012 will be made whole, but if a charity doesn't participate for one year they no longer be made whole; state appears to be picking "winners and losers."
• Probability that many current charitable gaming locations will close
• Two different regulatory agencies regulating table games.
• Proliferation: "Every state that has introduced casinos has seen proliferation - no state has just one casino."
• 1,583 direct jobs and 567 indirect jobs over two-year construction period.
• 1,949 full-time jobs with ongoing operations
• Abutting towns share 1 percent of net machine revenue; host community allocated 3 percent of net machine revenue.
• Casino visitors may patronize local businesses - stores, gas stations, restaurants.
• 1 percent of net machine revenue allocated to treatment, prevention, intervention and research.

"Revenue" subcommittee report:

• Increases General Fund revenue: range varies with location
• Shifts social costs: southern border location
• Protects NH family-friendly tourism/living brand: single license limits proliferation initially.
• Avoids the cost of doing nothing: As MA licenses its four casinos: ($35m) GF/year.
• Timeline: Add 9 mo. more for regulations plus 2 mo. more for background checks. Still possible to receive licensing fee in SFY 15.
• Gaming license: 20-year non-renewable, non-exclusive (bill says 10-year license with possible renewal for $1.5 million fee)
• Minimum fee: $50 million (applicant may bid higher amount – bill says $80 million fee)
• Minimum tax rate on VLTs: 33.3 % (up from 30 % in SB 152)
• Minimum tax rate on table games: 16 % (up from 14 % in SB 152)
• Distribution of gaming revenue: All tax revenue to General Fund, with 1 percent of Net Machine Income to host community, 1 percent to abutting communities apportioned by population; 1 percent to host counties within 40 minute circle, apportioned by population within that radius
• Problem/pathological gambling treatment handled through budget.
• Sale/transfer of license. Any profit to be considered business income taxable at BPT rates regardless of the legal form of the holding or transaction.