Columnist Jeff German: Gamers looking for more firepower

Monday, July 28, 2003 | 8:27 a.m.

WEEKEND EDITION

July 27, 2003

Jeff German's column appears Tuesdays, Wednesdays, Fridays and Sundays in the Sun. Reach him at german@lasvegassun.com or (702) 259-4067.

IT'S ALMOST AS if the casino industry thrives on divisiveness.

Coming off one of its poorest legislative sessions, gaming's largest employer, MGM MIRAGE, decided last week to bolt from the pack and go it alone on the political front.

MGM MIRAGE Chairman Terry Lanni wasted little time voicing his displeasure at the industry's performance in Carson City when he pulled his company out of the Nevada Resort Association, the industry's chief lobbying arm, just two days after lawmakers recessed.

Lanni's company, by no small surprise, also quit the Las Vegas Chamber of Commerce, which had opposed gaming's push for a broad-based business tax.

Though initially it was a mild shock, MGM MIRAGE's departure from the NRA wasn't all that unexpected. Lanni has never been an NRA fan. Before MGM merged with Mirage Resorts in 2000, MGM wasn't even an NRA member, and, when the mega-company joined under Lanni's leadership, it was with some reservations.

MGM MIRAGE's decision to operate as a lone wolf isn't likely to diminish gaming's political influence in the state. On the contrary, it may be the start of an industry-wide bid to come back at lawmakers who didn't support a gaming-backed tax plan.

Certainly, MGM MIRAGE's move will have a profound impact on the NRA.

Without MGM MIRAGE, the NRA loses $500,000 in annual dues and the clout of a company with 10 casinos and 36,000 employees in Southern Nevada.

But more importantly, the NRA is left wondering about its future as other companies contemplate breaking away and becoming more aggressive on the lobbying front.

Who among the local gaming giants will be next to leave? Park Place Entertainment? Mandalay Resort Group? Harrah's Entertainment?

Mandalay and Harrah's officials wouldn't say last week whether their companies also plan to go it alone. But Park Place Vice President Robert Stewart said his corporation was considering following MGM MIRAGE's lead.

"Given the extent to which this changes the dynamics, we are evaluating our next steps," he said.

If the NRA does break up, don't be fooled into thinking that gaming will drop from the ranks of the power brokers. The industry simply will find other ways to band together to achieve it's goal of spreading around the tax burden.

"We're still going to be traveling down the same road," Mandalay Vice President Mike Sloan said. "But we may be in different vehicles."

Even MGM MIRAGE Vice President Alan Feldman dryly noted, "We're not withdrawing from the gaming industry."

The truth is the industry, with its competing egos and diverse business goals, has a history of driving in separate cars. Casinos generally are united on the big issues, such as fighting tax increases and new IRS rules that cut into profits. But often they have different positions on less defined issues, such as the spread of Indian and Internet gaming.

A couple of years ago, Boyd Gaming dropped out of the NRA because of differences over neighborhood casinos. But Boyd supported the NRA's push for a broad-based business tax this year.

What may be the most intriguing aspect of MGM MIRAGE's withdrawal from the NRA is how it will affect the NRA's lobbying team -- specifically Bill Bible, Harvey Whittemore and Billy Vassiliadis. All three are well-respected in political circles, but Lanni, though he publicly praised the three last week, also sent them a message that they didn't come through for his company this session.

Gaming has always had an all-star lobbying team, but if this high-powered trio couldn't do the job, imagine what gaming now will assemble. An army of lobbyists, funded with a blank check?

That spells trouble for the lawmakers on the industry's hit list.

Over the next two years, gaming will be coming at them with a vengeance.