Card games trump gambling machines in state revenue

Monday, Sept. 26, 2005 | 9:53 a.m.

TULSA, Okla. -- Newly authorized card games such as blackjack and Texas hold 'em are generating about six times as much money for the state as new gambling machines that are now allowed inside Oklahoma's tribal casinos.

Card games have produced $3.8 million in revenue for the state, compared to $697,000 from Class III electronic games, state records show.

But state officials say those numbers could change as more casinos install the new machines and with a possible change in federal law that would allow the old Class II machines to be subject to fees paid to the state.

State Treasurer Scott Meacham said the tribal casinos started offering card games immediately, but it's taken longer than the state expected for the machines to start operating and producing revenue.

Companies that make the new machines cannot produce them fast enough, said Mike Miller, Cherokee Nation spokesman.

Last November, voters passed a state question that authorized tribes to offer card games and more sophisticated electronic gaming machines in exchange for fees paid to the state.

But so far, gambling has not produced as much revenue as expected. In the current fiscal year, it is expected to produce about $52 million, or more than _$4 million a month. Since January, gambling revenue totaled a little more than $4 million.

Horse racing officials have expressed concern that casino-operating tribes, particularly the Cherokees and Creeks, are not installing the new machines because they would have to pay a fee. But they continue to operate hundreds of Class II machines that are not subject to fees.

Ron Shotts, general manager of Fair Meadows in Tulsa, worked out a deal with the Cherokees, Creeks and Osages that the racetrack would not install gambling machines in exchange for a small percentage of Indian game revenues.

So far, Fair Meadows has not received any share, although it paid the state $50,000 up front.

Miller said the Cherokees already are experimenting with some of the new machines and will begin installing them by Oct. 1.

Over three months, the Cherokees paid the state _$706,735 in fees for card games and _$27,000 for electronic games.

Miller said that, eventually, 450 Class III machines will be installed at the Cherokee Nation's Catoosa casino with another 100 at its smaller casinos.

Other state racetracks will install Class III gambling machines, as authorized by voters, but the race tracks are limited as to the number of machines and hours of operation.

Blue Ribbon Downs in Sallisaw started installing the machines last week, although they still must test to state specifications before being operated.

Tribes compacting with the state to operate the gambling machines will have to pay 4 percent to 6 percent of the revenue generated by each Class III electronic gaming machine at a tribal casino. Tribes also will pay about 10 percent of what a player pays to enter card games.

For July, the Chickasaws of southeastern Oklahoma paid the highest amount to the state. Fees from table games amounted to _$243,616, while machine fees were _$93,279.

Twenty-six of the state's 38 federally recognized tribes have signed compacts for limited Class III gambling.