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October 24, 2014

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MGM Mirage splits from Nevada Resort Association

Citing cost-cutting measures, MGM Mirage said today the company has resigned from the Nevada Resort Association, the casino industry's primary voice in the state Legislature for more than 40 years.

The state's largest private employer says the resignation, effective Jan. 1, 2009, isn't political but financial. While that explanation might not have rung true a year ago, it does now given the depth of the economic downturn, which is testing the near-term viability of the state's economic engine. The company wouldn't divulge how much it pays in association dues

As their earnings continue to decline, casino companies including MGM Mirage are scrambling to pinch pennies wherever they can.

"These are difficult economic times and we're watching our dollars very carefully," MGM Mirage spokesman Gordon Absher said. "We appreciate (Resort Association President) Bill Bible's efforts and everything he and his team have done."

MGM Mirage left the resort association for about a year following the 2003 Legislative session. That was viewed as a political protest even though the company said it was simply stepping up its own lobbying efforts. The casino industry in 2003 failed to gain support for a broad-based business tax that would include other industries that pay relatively little in state taxes.

Significantly, the association has removed itself from a central debate that has split several major gaming companies in recent months. Wynn Resorts, Station Casinos and Harrah's Entertainment have negotiated with the Nevada State Education Association on a compromise plan to raise money for education by earmarking room tax revenue. MGM Mirage and Boyd Gaming oppose this plan and favor an alternative proposal that would include a business license tax.

The association has taken no position on either plan, nor has it taken part in any negotiations.

Political differences are common to every industry, though gaming, with its history of battling tax increases that would be unthinkable in other industries, has forged an effective front against such attacks over the years.

Absher said the company already has its own government affairs staff that performs many functions that are similar to the resort association.

Which raises another, bigger question for a group that began in 1965, a time before company-employed lobbyists and public relations teams. Has the association outlived its usefulness with gaming giants like MGM Mirage? Does it have a purpose serving smaller firms with fewer resources?

Bible said he hasn't discussed budgetary concerns yet with other members, nor has he considered the probability that large firms might opt out of the group.

Perhaps the next few months will yield some answers.

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