Montana gambling project endorsed by legislators

Bob Anez

Monday, March 31, 2003 | 9:56 a.m.

HELENA, Mont. -- A plan to create a nearly $2 billion gambling and entertainment center in Butte inched closer to reality Friday, when a legislative committee approved a bill authorizing creation of a special district in the city.

The House Taxation Committee voted 13-5 to endorse the project called "Destination Montana," which calls for construction of up to 11 large Nevada-style casinos, as well as music halls, golf courses, theme park, sports stadium and convention center.

The measure is expected to reach the House floor for a vote next week.

Although some committee members objected to the kind of expanded gambling that the project would bring to the state, most argued that legislative action in House Bill 757 was harmless.

Chairman Dan Fuchs, D-Billings, noted the bill self-destructs unless the developers make significant progress on the project by 2005.

"There are times you just have to take a leap of faith," he said.

"Is this a gamble? Yes," said Rep. Jesse Laslovich, D-Anaconda. But the risk belongs to the developers and not to the state or the Legislature, he added.

"I implore you not to be afraid of change," he told other committee members.

Rep. Ron Erickson, D-Missoula, said he has deep concerns about the project transforming Montana into "Nevada Light," but would support sending the bill to the House floor for a full debate.

On the other side was Rep. Karl Waitschies, R-Peerless, who feared the development would lead to wide-open gambling on Indian reservations and bring problems to nearby communities such as his.

One provision the committee added to HB757 allows Montana's Indian tribes to own the 11th casino in the complex if they agree not to have similar wide-open gambling on their reservations.

The project is expected to employ 10,000 people and produce $200 million a year in taxes for the state and local governments.

The video poker, keno and bingo machines in the district's casinos would pay the same 15 percent state tax as those types of machines in bars outside the district. On other types of gambling machines, the casinos would pay a 7 percent tax.

The bill makes major changes in existing gambling and liquor licensing laws by allowing a person to own more than one liquor license in the district and permit out-of-state residents to own such licenses.

Rep. Eileen Carney, D-Libby, lost her bid to remove those provisions after the bill's supporters said her proposal would kill the measure.

Rep. Verdell Jackson, R-Kalispell, managed to add a requirement that the state spend $500,000 of its proceeds from the project on gambling addiction programs.

But that was removed from the bill by another amendment offered by Fuchs. He argued that money the state receives should not be dedicated for specific programs so the Legislature is free to decide on the priorities for funding.

However, Fuchs then persuaded his committee to dedicate a portion of taxes collected from the development on promotion of horse racing in Montana.

A former horse breeder, he argued that the surge of video gambling has all but wiped out racing, which is an important part of the state's agricultural industry. "I see this bill as killing what we have left of horse racing in Montana," so using some of the money to help the business makes sense, Fuchs said.