Casinos rip restrictions on political donations

Thursday, June 3, 1999 | 11:31 a.m.

SAN FRANCISCO -- Casino leaders Wednesday voiced displeasure with a recommendation from the National Gambling Impact Study Commission to urge states to "adopt tight restrictions" on political contributions from the gaming industry.

"I think it was wrong for them to pass that resolution," said Frank Fahrenkopf, president of the Washington-based American Gaming Association. "It has a negative impact on our industry's ability to participate in the political process, and I hope no state legislature pays any attention to it."

Fahrenkopf and other casino industry insiders who sat through the 6-3 vote said the recommendation unfairly singles out gaming.

In Las Vegas, Mike Sloan, chairman of the Nevada Resort Association, called it a "ridiculous" proposal.

"I don't think that it makes any sense," Sloan said. "And I don't understand why anyone would vote for it."

Sloan and Mirage Resorts Vice President Alan Feldman, who has been attending the federal commission's meetings around the country, said the recommendation is destined to fail in Nevada, where gaming is the most politically active industry.

Casino companies traditionally have contributed the most to races throughout the state. Gaming, for example, was the heaviest contributor to the campaign of Gov. Kenny Guinn last year.

The recommendation, which does not include contributions to federal races, comes while Las Vegas has become a hotbed of political fund-raising for Democrats and Republicans in Washington.

Two weeks ago, President Bill Clinton raised $400,000 for the Democratic National Committee in Las Vegas. During that visit, DNC Chairman Joe Andrew told the Sun that Democrats in Washington want to be the party of the gaming industry.

Prior to the president's visit, House Minority Leader Richard Gephardt flew to Las Vegas to pick up a $250,000 check from Mirage Resorts Chairman Steve Wynn, who has decided to help the Democrats regain control of the House.

This week, as the federal commission held its final meeting before delivering its report to Congress and the president, the fund-raising blitz in Las Vegas picked up again.

Sen. Ted Kennedy, D-Mass., visited the city on Monday to raise money for his re-election; and Sens. Mitch McConnell, R-Ky., and Slade Gorton, R-Wash., the GOP's top fund-raisers in the Senate, had planned to be in Las Vegas on Wednesday.

Sen. John McCain, R-Ariz., will be in Las Vegas Thursday to collect cash for his presidential bid. MGM Grand Inc. Chairman Terry Lanni is hosting a reception for him.

Lanni, a member of the Gambling Impact Study Commission, voted for the proposed restrictions on gambling contributions in state and local races.

"I've always felt that the restrictions that exist outside of Nevada make some sense," Lanni said after the vote. "The less we have corporations contributing within the state, I think would be a far more admirable and far more desirable position."

Lanni said he wasn't worried that the recommendation makes it look as though the commission is picking on the casino industry.

"When you have a privileged industry .. you are separate and apart from other entities," he said. "And I think judging it separately is in the normal order of the process in the state of Nevada, and I don't think this is out of line."

Commissioner Richard Leone of New Jersey, who pushed the recommendation, shared that opinion.

"I think that industries that are high profile in the business of getting government permission to do business and to expand their businesses are good candidates to be singled out as examples," he said. "It's in the industry's interest to say, 'These decisions are not being made based on the amount of money we contribute."'

Leone originally had proposed a recommendation patterned after a New Jersey law calling for a total ban on casino contributions. But he softened the language after it appeared he did not have the support of his colleagues.

During the hearing, Leone said he believed that gambling and political contributions "don't mix well."

Commissioner John Wilhelm, who voted against the proposal, said he was concerned it could have a "domino effect" and spread to other industries.

"This makes no philosophical or equitable sense," Wilhelm told his fellow commissioners.

Afterwards, Commissioner Bill Bible, who also voted against the recommendation, said it has "more holes in it than Swiss cheese."

Rep. Jim Gibbons, R-Nev., a frequent critic of the commission, issued a statement calling the proposal unconstitutional.

"To restrict certain entities from exercising their free speech just because they represent a particular industry is a violation of equal rights," Gibbons said. "Hopefully this prejudicial policy will be soundly rejected by the states."

Gaming's investment in local candidates is evident in the current campaign between Arnie Adamsen and Oscar Goodman for mayor of Las Vegas.

Of the $947,400 Adamsen raised through June 1, slightly more than 12 percent, or $114,124 came from gaming interests.

Adamsen said he doubted the Nevada Legislature would have any desire to impose such restrictions, but said that if the federal government instituted them it would hurt local campaigns.

"That would restrict the ability of candidates to get their message out," Adamsen said. "Why should one particular industry be restricted from exercising their constitutional right to freedom of speech by supporting the candidates?"

Goodman has raised $143,124 from gaming interests through June 1 -- slightly more than 10 percent of his total $1,137,658 campaign war chest.

When the commission's proposal to prohibit contributions was first announced May 19, Goodman -- a criminal defense attorney -- said he doubted it would withstand constitutional scrutiny.

"People who are making that suggestion probably call Nevada, Nevahdah," Goodman said, enunciating the differences. "They always like to put down Nevada as second class."

He added that the strict regulations governing gaming interests in Nevada are simply not understood on a national level.

"This is a highly-regulated industry," Goodman said. "It's not some fly-by-the-night business here."

The commission, meanwhile, continued today to edit its report, which will give the nation an assessment of the social and economic impact of gambling in America.

Commission Chairwoman Kay James said she expects to hold a news conference with her colleagues at the National Press Club in Washington on June 18 to release the report of the panel's two-year study.

Sun reporterErin Neff contributed to this story.

Bible

Lanni

"To restrict certain entities from exercising their free speech just because they represent a particular industry is a violation of equal rights."Rep. Jim Gibbons