April 24, 2012 03:40 PM UTC

The Gambling World Comes to Mesa County

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• by: Konola

I’ve been somewhat amused to watch Representative Ray Scott during his first term in office. When he was in a primary race he made two notable comments-that for him this would be a one term deal because he had a business to run in Grand Junction and that he was shocked to take his first trip to Denver as a candidate and learn that there were people who would write legislation for representatives. I don’t know that he was referring to ALEC in his second comment, but I have my suspicions.

But I’m even more suspicious about his sponsorship of HB 12-1280. I’m speculating that Josh Penry had a hand in writing this bill, which benefits one race track owner. Isn’t he a lobbyist these days?

HB 12-1280 authorizes the installation of 2,500 video lottery terminals (VLTs) west of the Continental Divide, but not within 100 miles of the Ute casinos. It limits the terminals to no more than two retailers, which is an “improvement.” In the beginning, this was a bill with one video terminal retailer in mind. I guess the Republican sponsors decided they needed to at least pretend there was the potential for some competition. Or maybe there is more than one county that wants VLTs? One for Don Coram. One for Ray Scott.

According to the fiscal notes on the bill:

“Prior to installation of VLT machines or operation of a site, local approval is required by either a majority of the governing body or a majority of the voters in the city or county where the VLT site is to be located. The local governing body may impose annual impact fees of up to $5 million, adjusted annually for inflation, to be paid by the lottery retailer to defray the costs of the on- and off-site impacts directly related to the operation of the VLTs.”

Clearly the intent is to give Craig Meis and Janet Rowland the ability to approve a VLT in Mesa County and to decide what local impact fees should be charged. Citizens will never be given the right to vote on this. The last time there was such a vote it was defeated 4 to 1.

But it gets better:

“Lottery retailers must be a pari-mutuel licensee that owns or controls a licensed track and that is in compliance with all statutes and rules regarding the conduct of a race meet of horses at, and the operation of, the licensed track. Lottery retailers are entitled to receive compensation equal to 70 percent of net machine income.”

That begs the question of who owns licensed tracks in Colorado, since this bill is directed at increasing their revenue. Arapaho Park, is the only eligible licensed track in Colorado, and is owned by Mile High Racing and Entertainment, which is a wholly owned subsidiary of BLB Investors, LLC.  BLB Investors, headquartered in Connecticut, is owned by Kerzner International Limited, Starwood Capital Group Global, LLC and Waterford Group, LLC. If I were a real investigative journalist, I’d be digging even more, but my head is spinning from all of the layers already uncovered in this investment scheme, so I’m going to leave the question here.

This sorry tale has even more twists. If passed it will certainly wind up in court, since it is using semantics to get around the Colorado Constitution’s limits on gambling. Casino owners in Colorado’s mountain towns will be heading to court the minute this bill is signed, if ever. Then there is the question of who should regulate this operation. The bill suggests that it be regulated by the State Lottery Division, which is a deliberate attempt to get it outside of the constitutional limitations.

But there is just one more twist: at least one writer (Peter Blake, of the Colorado News Agency) is speculating that this is step one in getting Uranium Downs up and running in Grand Junction. Hey, WAIT A MINUTE! Isn’t the old Uranium Downs the current Mesa County Fairgrounds?

Now I’m really curious. How do Janet Rowland, Craig Meis, and Ray Scott plan to turn the fairgrounds over to a Connecticut horse and greyhound racing association? And which pocket gets filled with cash?

Sponsors built in one nice feature-some of the new revenues to the state, estimated to be in the range of $17-million, would go to Colorado schools and kids needing scholarships. Nevertheless, I’m guessing it will never get out of the Senate if it ever makes it out of the House.