The house wins again as Legislature draws to a close

Brendan Riley

Monday, May 31, 1999 | 3:49 a.m.

CARSON CITY - Nevada casinos, as usual, held the high cards during the 1999 legislative session, avoiding any new tax hikes and - for casino mogul Steve Wynn - getting a big tax break.

But while Wynn is certain of his art tax break that could save him as much as $18 million, the casino industry in general may face hassles with voters next year as a result of the legislative events of 1999.

Sen. Joe Neal, who lost his unrelenting effort to increase the tax on casinos, said he'll circulate petitions among voters to put the tax increase proposal on the November 2000 ballot.

"When your schools are getting condemned and your constituents want library books and transportation, think about what you have done," he told senators after they approved the tax break.

The proposal by Neal, D-North Las Vegas, would have raised the 6.25 percent tax by two points. In the petition, he'll ask for a 9.25 percent gambling tax rate.

Also, Nevada's teachers union says it will start a ballot drive next year to impose a 5 percent tax on the profits of businesses - including casinos - to provide up to $150 million a year for education.

Wynn, who has a $300 million-plus collection at his Bellagio resort in Las Vegas, got a big tax break through a bill that allows anyone with a major art exhibit to charge a fee and still be eligible for property and sales tax exemptions.

The measure passed despite Neal's insistence that it would mean a tax break of at least $15 million for Wynn, although proponents questioned that figure.

Sen. Bill O'Donnell, R-Las Vegas, said there's nothing wrong with helping out someone who is such a major contributor to the state's economic well-being.

Lawmakers also resolved an industry spat by approving a new law sought by major casinos that said the growth of Megabucks and other networked slots could undermine the profitability of Nevada resorts.

The casino executives also said the growth could reinforce a monopoly enjoyed by the world's biggest slot maker, International Game Technology of Reno.

The original version of the measure would have forced the manufacturers to offer such leased games for sale. But that requirement was amended out of the bill.

The resorts' gripe was that lease agreements for slot machines allow manufacturers to make money from the slots without assuming any of the risks associated with actually running a casino.

Though watered down, the new law still requires slot manufacturers to pay their share of state taxes based on the amount of money the machines generate.

The law also requires that slot manufacturers offer the same games to small casinos that they offer to larger, mega-resorts. Also, it spells out the regulations already adopted for such slots by the state Gaming Control Board.

One measure that didn't survive would have helped Boyd Gaming Inc. develop two properties in the Las Vegas. The proposal was shelved after homeowners said they wanted lawmakers to keep a 1997 promise to prevent new casinos from being built in residential neighborhoods.