City puts online gambling on the shelf

Diana Sahagun

Wednesday, March 6, 2002 | 11:06 a.m.

The Las Vegas City Council today voted to delay indefinitely a proposal to sell use of the city's name and seal to an online casino.

Las Vegas City Manager Virginia Valentine had recommended that the council shelve the idea.

Months after the city of Las Vegas began dabbling in the prospect of Internet gaming, Valentine wanted the council to delay any action because of unanswered questions about regulation, liability and legality.

Mayor Oscar Goodman, who has pushed the idea as a means of gaining revenue, said Tuesday that he would follow Valentine's advice, but that he wants the council to address the matter in the future.

"I have no problem with that whatsoever," Goodman said.

"But I am proceeding on behalf of the city to get ourselves in a position that, once these questions are answered, we'll be able to latch on to the first ones who are put in cyberspace."

Goodman said he has met with "substantial Nevada gaming companies" that are interested in using the city's name and seal as part of an online casino.

The companies, he said, have asked to remain anonymous.

"I'm dealing with some casinos right now who believe they will be at the front of the line once they get the go-ahead," Goodman said.

Councilwoman Lynette Boggs McDonald, citing legal questions, had been opposed to the proposal all along.

Internet gaming has been at the forefront since 2000, when vegasone.com proposed to use the city's name and seal in return for a share of the profits of the Australian-based website.

The proposal died when Goodman was forced to abstain on the issue, but the mayor has kept the idea alive as the city's revenues continue to dwindle.

Valentine said it is unclear whether Internet gaming is legal in the United States and, despite improvements in technology, there is no way to guarantee that minors would not have access.

The Department of Justice has taken the position that Internet gaming is illegal in the United States under the federal wire act, although this position is being challenged in federal appeals court.

Valentine said a decision to re-examine the proposal will be based on research by the Nevada Gaming Commission and the attorney general's office. Both are studying online wagering and in about a month the attorney general's office expects to release a legal opinion on whether it is legal in the United States.

The 2001 Legislature in June passed Assembly Bill 466, which allows Nevada regulators to establish rules for casinos interested in launching online gaming.

The state Gaming Control Board has yet to produce draft regulations for Internet gaming.

Valentine has had several discussions with Gaming Control Board Chairman Dennis Neilander, who indicated the board was researching legal aspects of the venture.

"One of the challenges is there is so much mixed information," Valentine said.

Bill Bible, president of the Nevada Resort Association, told Valentine gaming industry representatives also have mixed opinions.