A Winning House – (Hint, We’re Not The House)

March 5, 2012 10:30 am

by Charlie · 6 comments

The following is a guest post from frequent commenter Bridget Cantrell, who has spent some time tying together various articles regarding the behind the scenes efforts to bring casino gambling to Georgia:

 

“Remember this: The house doesn’t beat the player. It just gives him the opportunity to beat himself.” – Unknown.

This article  was posted early last week.  The gist of it is that a developer plans to build a $1B gambling complex close to Norcross.

The article mentions “It’s been a tough sell in Georgia, where conservative groups and legislators fear it could erode family values and lead to increases in crime and divorce.”  I’m not a social conservative against gambling; I’m a fiscal conservative against being ripped off.

The articles notes:

It isn’t the first time that O’Leary has rolled the dice on an ambitious gambling project. He had a plan in 2009 to transform Underground Atlanta, the downtown attraction he operates, into a casino with restaurants, shops and a hotel. The project was scuttled amid opposition from then-Gov. Sonny Perdue.

The developer is making the case that this development could funnel $350 million a year into HOPE and create 2500 new jobs.  Believe me – I get that Georgians need jobs.  I’m in business development myself and feel the economy every day.  The point I’d like to make is that the contract intended for a prior project like this could have a damaging ripple effect.

Granted I’m a novice contract reader, but my first job out of college was for a global construction company (and savvy VP) who taught me the value of zingers and fine print.

The letter of intent referenced in the article is here  In this LOI are the following terms:

    • The Owner would retain Operator to act as its exclusive agent.
    • Section 1.20 defines Territory as the entire state of Georgia and all territories within a 150 mile radius surrounding Underground Atlanta.
    • Section 2.8 outlines a non-compete in this Territory for five (and up to nine) years.
    • Section 2.10 allows consultants unlimited travel and entertainment expenses.

This sounds like a statewide exclusive long term contract in which expenses for “consultants” do not have to be disclosed.  Do we really need to throw gasoline-soaked wood on the Ethics fire?

The article also notes:

 O’Leary said his new project won’t need legislative approval because it involves video terminals already permitted under state law. But it will need the backing of the Georgia Lottery Board, which would regulate the gambling machines, and whose members are appointed by Gov. Nathan Deal.

The computer geek in me has another issue:  This article from USA Today explains the following:

 ”When high-tech slots are in place, programmers will be able to control nearly every aspect of the game — cost, payout, even the images that line up on the payline. Casino operators will be able to make changes in real time through back-end servers that talk to computer chips inside the slot machines.”

So…will this be the new place to host “legislative happy hours”??

This article was posted Friday morning by the AJC, saying:

 “The partners visited at least 10 potential sites and quietly wooed local elected officials and state lawmakers with their argument that the new gambling revenue can save the struggling HOPE Scholarship program.”

Is it me or does the “quiet wooing” of your elected officials sound like the tax payers get the opposite of wooed?  I just can’t see how Georgians win in the long run by financing a monopoly contract for a casino VLT facility Operator who can change the odds at their whim.

The House would win indeed; Georgians – not so much.

Calypso March 5, 2012 at 11:42 am

Have the odds set by law. I’m sure it’s done elsewhere.

Why do you say “I just can’t see how Georgians win in the long run by financing a monopoly contract …” when I’ve not seen anything about Georgians financing any contract.

The non-compete should be handled in the same fashion as any non-compete contract be it car dealerships of the same brand or fried-chicken franchises. Georgia law doesn’t seem to have a problem with that.

gcp March 5, 2012 at 11:48 am

O’Leary’s project is merely an extension of the state gambling monopoly otherwise known as the lottery. It’s time for the legislature to legalize real casino gaming with a portion of profits dedicated to HOPE. Deal can scream all he wants about how he against casino gaming but when presented with a bill he will sign it much like he did with Sunday sales. I realize the overpaid state lottery bureaucrats will fight casino gambling to the death but it’s time to bring home some of that revenue that goes to Cherokee, Biloxi, and Alabama.

22bons March 5, 2012 at 12:08 pm

What happens in Vegas should stay in Vegas. Gambling is predatory, and I certainly don’t want to see Georgia promoting or expanding the industry.

Rambler1414 March 5, 2012 at 12:16 pm

As a poker player (which is clearly NOT gambling, it is a game of skill that pits player vs. player)

It’d be nice to have a facility to do that in Georgia instead of taking my business to Biloxi, Tunica or Tampa/Hollywood twice a year.

22bons March 5, 2012 at 1:25 pm

Travel requirements greatly reduce the number of unskilled rubes who are sure to be fleeced by skilled players such as yourself. Playing for nominal stakes with similarly skilled friends is fun. Otherwise, not so much.

rebelyelp March 5, 2012 at 12:19 pm

We don’t need gaming terminals in Georgia to corrupt our local politicians. Remember that video of the now indicted Kevin Kenerly living it up at the gaming tables in Las Vegas? Might as well save them some travel costs and keep the money here in Georgia.

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