Nevada Bill Allows Cover Charge - Tuesday 12th of April 2005

The Senate Judiciary Committee has unanimously approved a bill that would allow casinos to charge admission to areas where gaming is conducted under certain circumstances.

The proposal, backed by the Nevada Resort Association, is expected to be considered by the full Senate next week. The Assembly would also have to approve the bill before it could be delivered for the governor's signature and become law.

The purpose of Senate Bill 444 is to enable casinos to offer gaming at events at which an admission fee is charged. Nevada law prohibits casinos from charging admission to any area where gaming is allowed.

The ban has effectively prevented casinos from setting up blackjack tables at VIP events and parties or putting slot machines in nightclubs that have a cover charge. It also has blocked the Stratosphere Hotel from offering gaming in its tower.

Under the proposal approved by the committee, the Nevada Gaming Commission, with the assistance of the state Gaming Control Board, would adopt regulations that would establish procedures for licensees to get permission to charge a fee for admission to an area where gaming is conducted.

The bill draft submitted on behalf of the Nevada Resort Association by the Las Vegas law firm of Lionel Sawyer & Collins outlines the establishment of a revolving fund account to pay the expenses of board or commission agents and access to events at which an admission is charged so that regulators could monitor gaming activity.

The bill also includes provisions that clarify the payment of live entertainment taxes when an admission charge is asked and that casinos that charge admission to events can't discriminate against patrons on the basis of race, color, religion, sex, national origin, ancestry and physical ability.

State Gaming Control Board Chairman Dennis Neilander said his board has taken a neutral position on the bill, since it is a policy question that could only be considered by the Legislature.

Neilander testified on behalf of the board to make sure regulators could properly oversee casinos that set fees on events in gaming areas. Representatives of the Palms testified in favor of the bill.

An amendment offered on behalf of Control Board concerns was incorporated into the bill. The amendment provides guidelines for the chairman to make determinations on factors for determining requests, including the size of the area of a paid event, the amount of gaming occurring within the area, the types and quantity of gaming offered, the existing business purposes of the area, other amenities that are offered within the area, the costs incurred in creating the area, the benefit to the state in having gaming conducted within the area and the amount of the fee charged.

The amendment also enables the chairman to determine if the area would more appropriately be treated as a private gaming salon. It also establishes an appeal process of the chairman's decision through the Gaming Commission.

Anthony Curtis, who publishes the Las Vegas Advisor, a newsletter for visitors to the city, said the legislation eliminates a loophole that has been troublesome to casinos.

"I think it's a good thing," Curtis said. "It makes sense, for example, on things like pool parties where they want to control crowds with an admission fee that they would be allowed to put up blackjack tables as part of the entertainment."

Curtis said the legislation would block people from attempting to enter paid events under the guise of accessing nearby gaming. He said people have gotten into casino Super Bowl parties for free by telling ticket-takers that they wanted to go to the gambling areas.

The provision giving the chairman discretion to consider relevant factors in a request would prevent casinos from charging admission to their properties.

"I don't expect that would happen anyway," Curtis said. "The free market would keep it under control. Why would I pay to get into one casino if another is free?"

Midwest riverboat casinos charge an admission fee for "cruises," a form of tax on casinos in states in which boats are docked.

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