Regulators: Slot ‘lock-up’ law could cost millions

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By Gintautas Dumcius

STATE HOUSE NEWS SERVICE

BOSTON — With the state’s first slot parlor due to open in five months, Massachusetts regulators are calling on legislators to make adjustments to the 2011gambling law or face the possibility of losing millions of dollars in revenue.

Under the law authorizing up to three casinos and a slot parlor, operators are required to stop a gambling machine transaction once someone wins $600. The nascent gambling industry in Massachusetts believes increasing the threshold is “absolutely critical,” according to Gaming Commission chair Stephen Crosby.

Crosby said given the expected opening of a Penn National Gaming slot parlor in Plainville on June 30, the issue has become time-sensitive for the industry.

“That’s one of the reasons I brought it up now, because the time is short, because they have to program their machines,” Crosby said. “The machines have to be programmed to do something, whatever it is that the policy is going to require.”

Resort casinos are on track to open in Everett and Springfield in the next several years.

The Legislature frequently revisits major laws to make modifications but some lawmakers have been reluctant to reopen debate on the expanded gaming law in the wake of its contentious path to passage.

Under current law, a player will not be able to play the machine again until a casino or slots employee takes down the player’s name, address and 5 percent off of the $600 in winnings for a state withholding tax, according to Crosby.

Most states have gambling machines programmed to “lock up” at wins of $1,200, Crosby said.

Commissioner Enrique Zuniga said a low threshold such as $600 could drive players to the gambling facilities in Rhode Island and Connecticut.

Crosby said based on numbers from Penn National, if 5 percent of slots players felt this was “enough of an imposition” on their gambling and they head out of state, it could cost the state $6 million in revenue.

“And the whole point of the Massachusetts law was to repatriate Massachusetts dollars that are now being spent in other states, and this runs counter to that objective for regular players, making it much more problematic,” Crosby said.

Crosby said he could not attest to Penn National’s numbers but said they were based on “very serious research” by the company.

Crosby said he spoke with House and Senate staff and the Legislature is open to considering the change. But he said lawmakers want the commission to make the case for the change. “They basically said, ‘We’re going to hold your feet to the fire. If this holds water, if this is really an issue, we will give it a serious look,'” he said.

Gaming regulators have previously called for other changes to the law, including a relaxation of criminal record information standards that they say are inconsistent with recent reforms, but Crosby said the threshold change to $1,200 is the one gambling license holders believe has the most urgency.

Crosby said he plans to provide lawmakers with additional analysis in the next week.