Moving on to bigger and better offices

Tuesday, Jan. 30, 2007 | 7:14 a.m.

Computer engineer Travis Foley is counting the days before he can move to a larger office where he and his colleagues can better keep the state's economic engine firing on all pistons.

But for now, he's confined to a cramped, dimly lighted room, seemingly colliding at every turn with banks of slot machines and locked filing cabinets that contain thousands of computer chips stacked like boxes of meticulously marked staples. They are copies of computer chips that have run every slot machine played in Nevada since the late 1970s. Nearby are more filing cabinets stuffed to capacity with DVDs - not an obsessive fan's movie collection but discs burned with slot machine software code.

A few steps away are clusters of slots, some unlit or with parts missing and others like robotic patients on life support, hooked up to monitors reading software code designed to monitor cash flow. There's barely enough space for Foley to pick his way through the clutter of machines, to watch their progress and sign their discharge papers as they are wheeled out a back door and trucked to casinos across the state.

"We've had to get creative with space," said Foley, who stands near a slot machine so tall that it pokes through a ceiling panel. Like a disembodied arm, half of an electronic table game sits nearby, the rest of its machinery - a big-screen TV and several computer hard drives - shoved into a small room next door.

Foley isn't running what looks like the state's sorriest casino. He has one of the state's most critical jobs: managing director of the Gaming Control Board's technology division, the agency charged with testing all gambling devices approved for play in Nevada.

It's also the agency shouldering the responsibility of maintaining public trust in casino games - a principle that has allowed gambling to flourish worldwide as a mainstream, multibillion-dollar pastime.

And because of a wave of new slot machine technology, Foley and his crew of technicians are moving to new facilities where they can better keep up with the pace of development and provide the confidence to gamblers that the machines are operating fair and square.

That trust is hard earned.

While microprocessors randomize each spin of a slot machine and agents spot-check devices every few years - matching computer chips for each slot with the copy they keep on file - some gamblers believe slots are rigged to pay out at specific times and even to certain people. The Gaming Control Board is facing a new test of that trust with the arrival of wireless gambling devices resembling cell phones and slots that allow bosses to change games and odds from a central computer server.

If technological advances are burdening the Control Board today, it was simple communications that challenged it two years ago.

When casino attorney and former regulator Mark Clayton was appointed to the Gaming Control Board in early 2005, he discovered a strained relationship between the board and the companies it regulates.

That might be expected in a state that doesn't cooperate with the gaming industry. But in Nevada, the situation was troubling. Miscommunication caused delays for manufacturers hoping to distribute their products before they became outdated within months and created more paperwork for regulators just barely keeping up with a flood of new machines.

The process of testing gaming devices - a system adopted by other casino jurisdictions across the globe for its thoroughness and track record - had become so frustratingly inefficient that it threatened the competitiveness of the state's primary industry.

Rather than submitting slot machine software ready for approval, manufacturers were creating subpar software with bugs in the system and effectively using Gaming Control Board testers to find and fix those bugs.

Meanwhile, regulators were taking up to a year to approve slot accounting systems that could have been reviewed in half the time. Staff wasn't held accountable for delays, with work sitting idle when auditors or technicians went on vacation.

"There was this thinking (at the Control Board) that you don't question the timeline for when things are (approved) - that we're done with something when we're done," Clayton said. "That wasn't an acceptable response."

Meanwhile, the systems used to account for cash flow inside slot machines - and the state's cut of taxes - were getting more complicated. Systems were morphing from simple accounting devices similar to those in other industries into sophisticated marketing systems identifying what individual gamblers spend and generating comps and personalized messages to entice them back again.

Systems testing was historically handled by accountants in the board's auditing department - people less equipped to review increasingly technical software that feeds information into multiple sources like marketing databases.

Manufacturers were developing innovative technology without having a clear idea of how regulators were reviewing it and whether those systems were up to snuff. Because new slot games can become passe within a few years, delays were costing companies money and leading some to introduce new slot machines in states such as California, where they could get quicker approval.

But Nevada regulators, muddling along under the same structure, had long since grown accustomed to industry gripes.

Like a dysfunctional couple finally entering marriage counseling, regulators sat down with slot makers and casino bosses in an unprecedented series of meetings over several months in 2005.

"We said we would try to turn around products in X-amount of time if they submitted systems without bugs," Clayton said. "If we found bugs in the system, we'd kick them to the back of the queue."

Regulators also accepted some responsibility for the delays, creating standards for these new accounting and marketing systems, distributing pamphlets across the state and posting them on the Internet.

A year ago the board also created the technology division headed by Joe Bertolone, a former Silicon Valley management consultant who had worked with high-tech giants Cisco Systems and VeriFone.

The auditing department and lab technicians who were fairly independent of one another now report to Bertolone and Clayton. Also folded into the technology department was the board's woefully outdated IT department, which is upgrading a computer database built in the 1980s so that board agents making casino checks can access records from their laptops.

To better keep pace with the flood of new games, the board is hiring up to 11 computer networking experts schooled in the latest technology and moving its overcrowded lab to a 15,000-square-foot office near McCarran International Airport, not far from the cluster of slot makers who do business in Nevada.

Once the lab opens in March, the board will be prepared for a higher volume of machines over the next five to 10 years, Clayton said.

The more responsive relationship between manufacturers and regulators will help the process, Bertolone said.

"We've established great lines of communication," he said. "We call manufacturers every six months or so to talk about how things are going and new technology coming up. This was a team effort."

The software platforms that are the machines' brains can take from six months to a year to approve while new versions of the same basic game take about a month to pass through the lab. The board typically approves up to 3,000 so-called game modifications every year - the majority of the lab's traffic. These are existing games tweaked with new symbols, a bonus round or two and maybe a new jackpot.

Today's lab - a warren of three small rooms on the first floor of the Sawyer State Office Building downtown - looks fairly low-tech.

Foley, familiar with each nook and cranny after about nine years with the board, stands next to the colossal Beverly Hillbillies slot machine that juts through the ceiling. The device, he says, will fit nicely in the new lab, which will have higher ceilings and triple the space. It also will have a simulated casino floor and private booths to prevent the spread of trade secrets by company deliverymen dropping off and picking up their precious cargo.

"The ceiling in the new lab is higher than 12 feet," Foley said. "If these machines get any taller we're going to have to have a regulation that says they can't be higher than 12 feet," he joked.