Feds launch new study of gaming

David Strow

Tuesday, July 20, 1999 | 11:17 a.m.

The gaming industry is under federal examination again -- and this time, Las Vegas will be put under the microscope.

At the request of Rep. Frank Wolf, R-Va., the General Accounting Office has begun a series of case studies of four to six communities nationwide where gaming has had a significant impact. Last week, a team of six GAO auditors made Atlantic City their first stop.

Next on their list: Las Vegas.

"Las Vegas, like Atlantic City, was a city where (the National Gambling Impact Study Commission) did not do an in-depth study," said Bernard Ungar, director of government business operations issues at the GAO, the investigative arm of Congress. "Our plan is to go to Las Vegas."

Ungar said the team of auditors will arrive in Las Vegas no earlier than September. They will look to meet with Mayor Oscar Goodman, members of the Nevada Gaming Commission, law enforcement officials, state social service organizations and top casino executives.

Wolf, one of the most prominent anti-gaming voices in Congress, requested the GAO investigation in December.

Ungar said this research will be different than the national commission study because of the GAO study's community focus.

"We certainly don't want to duplicate the study, but build on it," Ungar said. "We will be looking both ways. Rep. Wolf was asking for negative effects, but we have to do this effectively. We don't have a stake in this one way or the other.

"This will be more of an assessment than an audit."

Former Nevada Gaming Control Board Chairman Bill Bible, a member of the study commission, responded that the commission had already addressed that.

"We looked at (gaming's) impact, made a number of conclusions in those areas," Bible said. "We took a great deal of testimony, did hearings in Atlantic City, Las Vegas, throughout the country.

"This sounds to me like it's redundant to the commission's work, a waste of the taxpayer's money."

Wolf's office did not return telephone calls seeking comment. But local industry critic Steve Miller said he believes his connections with Wolf and commission Chairwoman Kay Cole James helped inspire the GAO audit. Miller says the gaming industry hasn't been contributing its fair share of funds to help with pressing needs in Las Vegas including problems with education, poverty, crime and traffic.

"The (Las Vegas) community is just begging for help right now," Miller, a former city councilman, said. "The quality of life is diminishing in this area while corporate profits are increasing. If Congressman Wolf found that as a reason for inspiring this study, it was because I supplied it to him."

The GAO will analyze three main issues: the political influence of the gaming industry and its political fundraising activity; the social and economic impact of gaming on a community and alleged subsidies gaming companies receive from local governments.

For example, the GAO intends to study job creation, tax revenues and crime trends.

"We may not be able to make cause and effect relationships ... we may just be able to say, 'This is what happened,"' Ungar said. "For example, crime. I don't know that we'll be able to make any definitive conclusions on that."

The Las Vegas report will be different from reports on other cities, since gaming has existed in this community since 1931 -- making a "before/after" analysis of gaming's impact on Las Vegas nearly impossible. The GAO will instead look at its impact over a period of several decades.

"Anyone who's lived here in the last 20 years can cite examples of the deteriorating community," Miller said. "We're in a position where we need to tap our own resources, but aren't able to, because leaders of our state are so subservient to the casino industry that supplies them with outrageous amounts of funding."

Although the GAO doesn't expect to issue a report until at least next year, it does plan to release a study on the political fund-raising activity of the gaming industry by the end of this month.

"I think what this does reveal is that Mr. Wolf will continue to spend the taxpayers' dollars in multiple ways to eventually get the answer he wants," said Jim Mulhall, vice president of governmental relations at the Nevada Resort Association. "It is a reflection of the implacable nature of Mr. Wolf's opposition to the industry and Nevada.

"If (the GAO study) is done fairly, I think the industry and the state will come out with flying colors. But there's no light at the end of this tunnel."