State, gambling foes bicker over gaming expansion law

Joel Stashenko

Wednesday, Dec. 17, 2003 | 9 a.m.

GUILDERLAND, N.Y. -- The largest expansion of gambling in New York history violated the state constitution and threatens to turn the state into "one big Las Vegas," anti-gambling lawyers argued Tuesday.

Neil Murray contended before a midlevel state appeals court that New Yorkers, not just their Legislature and Gov. George Pataki, should be heard on such a significant venture into state-sanctioned gambling.

In October 2001, Pataki and lawmakers approved establishing up to six new casinos on Indian lands, putting video lottery terminal betting machines into most horse racing tracks in the state and allowing New York to join the multistate Mega Millions lottery game. At the time, the state was reeling from destruction of the World Trade Center towers, mired in a recession and desperate for new sources of revenue.

Murray, representing anti-gambling lawmakers and groups, said all the gaming ventures violated the state constitution.

"We should not sacrifice our constitution on the altar of political or economic expediency," Murray said.

He contended, for example, that video lottery terminals are prohibited by statutes that ban slot machines in New York. Murray also argued that some VLT revenues -- which should all go to benefit education, under the constitution -- would instead go to horse racing purses and breeders' funds.

"Let's call it what it is. They aren't thinking about education here," Murray said. "They were thinking about bailing out the race tracks."

Another anti-gambling lawyer, Jay Goldberg, said the state has had a "deeply held" policy of legalizing only certain types of gambling such as bingo and the lottery -- and only then by amending the state constitution. That process would afford all New Yorkers to be heard on the issue in the form of a statewide referendum, he said.

"Why not use the amendment process?" in the case of the October 2001 gambling expansion, he asked the five justices of the Appellate Division of state Supreme Court Tuesday.

Goldberg also said the gaming bill is designed to turn the whole state into "one big Las Vegas."

At least one of the justices also questioned if the way Pataki and Legislature approved the gambling bill was appropriate.

Justice Karen Peters wondered repeatedly whether the sweeping expansion of gambling was something that should have been done through an amendment to the state constitution.

"Wouldn't it be better for the governor and the Legislature to go back to the people and say, 'Hey ... what do you think?"' Peters asked.

But Caitlin Halligan, the state solicitor general arguing in support of the gambling law, said the federal Indian Gaming Act guided the Indian casino portion of the gambling expansion. The governor and Legislature, essentially, had no choice but to reach casino compacts for the six new gambling operations or have the process taken away entirely under the federal law, she said.

Randy Mastro, a former deputy New York City mayor representing the casino developer Park Place Entertainment Corp. of Las Vegas, argued that "without question, federal law controls" the establishment of Indian casinos, not the state constitution.

The court Tuesday was hearing an appeal of Supreme Court Justice Joseph Teresi's ruling that upheld the legality of the October 2001 gaming law.

The appellate division judges usually take about two months to hand down written rulings after they hear oral arguments, though the complexity of the gambling case might delay the process. At several points in nearly two hours of arguments Tuesday, Peters said how "confused" she was by the questions of state and federal law and the particulars of the gambling industry.

So far, the Seneca Indians have opened a new casino in Niagara Falls under the October 2001 legislation and New York state has participated in the Mega Millions game since May 2002. Thoroughbred and harness track operators are scrambling to establish special halls on their premises to operate the VLTs, with some planning to open early next year.