Friday, Oct. 24, 2003 | 11:03 a.m.
CARSON CITY -- A West Virginia company was told by members of the state Gaming Commission Wednesday that it better improve its business practices -- but the commission voted 3-2 to award it an unlimited license for operation of the Ramada Inn and Speedway Casino in North Las Vegas.
MTR Gaming Group, which operates a racetrack in Chester, W.Va., and is expanding into Pennsylvania and Ohio, has received two two-year limited state permits and was up for renewal for a full license. Commissioners told company President and Chief Operating Officer Edison R. Arneault that the publicly traded firm makes promises to tighten business practices but then doesn't follow up.
Commissioner Augie Gurrola said "You say you will implement these things and they never happen." He said it appears orders go out from the top of the company but departments don't follow through.
The commission focused on the purchasing practices of the company. Commission Chairman Peter Bernhard said the purchasing system opened the door for potential kickbacks.
Bernhard said the company didn't have any problems in Nevada at its North Las Vegas casino, but problems occurred at the company's headquarters.
Arneault argued that his company has been pro-active in attacking the problems. He said it hired a national accounting firm to make recommendations and these are being put in place.
He and Chief Financial Officer John W. Bittner Jr. told the commission that things have been tightened up at the company in spending for entertainment, travel and other areas. Gurrola asked about the operation of the Speedway casino. He said company officials seem to be saying "If they don't make more money they will sell it."
But Arneault said the Speedway was "doing pretty well" in light of growing competition and he mentioned the new Cannery hotel-casino. "We want to see what develops with the competition," he said.
He said there were "lots of ideas about a potential re-theming."
Bernhard and Commissioner Sue Wagner voted against the unlimited license. They favored a continued limited license to see if the company could clean up its troubles. Bernhard said there was a "culture (in the company) that opens the door to wrongdoing."
Bernhard said he had no trouble with the officers in charge but questioned if there "was a commitment at the top" to solve the problems.
Separately:
Mayor Michael J. Franzoia and his wife, Ann, will hold 50 percent of the slot machine business at the Winners Corner in Elko.
Bernhard told Franzoia that he has to fully disclose his interest when any gaming matter comes before the council. Bernhard, former chairman of the state Ethics Commission, referred to recent cases about full disclosure.
Bernhard advised the mayor that he must completely reveal his interest and then publicly say why he feels he can or cannot vote on the issue.
"It is always better to err on the side of caution," Bernhard said.
Franzoia, who served two terms on the City Council before being elected mayor, said, "The public knows where I stand." He said he has always disclosed his business interests in prior cases.
The Gaming Commission agreed to waive the regulation that limits public officials from holding gambling licenses and approved the application.
A panel of the state Ethics Commission this week found there was "just and sufficient cause" for a full-scale hearing on a complaint that Mack did not fully disclose his business relations when he abstained on voting on a billboard issue.
The full commission will meet Nov. 13 in Las Vegas to hear the case.
Mack said he was abstaining because Eric Goodman, the attorney for the billboard company, represented him on a personal matter.
The panel said Mack failed to disclose that he was in business with Ross Goodman in setting up a firm to distribute computer disks to consumers about entertainment in Las Vegas.
Both Goodmans are the son of Mayor Oscar Goodman, who also did not vote on the case.
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