Low casino fees a problem for Henry administration too

Low casino fees a problem for Henry administration too

by Ray Carter

Director, Center for Independent Journalism

(December 6th, 2019) -- Gov. Kevin Stitt has said Oklahoma casinos are not paying market rates for geographic monopoly rights to operate gambling facilities, which significantly reduces state government funding. Stitt isn’t the first statewide officeholder to raise this issue.

In 2008, former State Treasurer Scott Meacham, who negotiated the state’s gaming compacts on behalf of former Gov. Brad Henry, opposed the opening of a tribal casino because it would result in a loss of revenue to state government, pointing to the lower fees paid by tribal casinos compared to the rates paid by state racetrack casinos, or racinos.

In a June 9, 2008 letter sent to the U.S. Department of the Interior, Meacham wrote that if the Shawnee Tribe was allowed to open a casino in Oklahoma City, the state would “be harmed” because of a loss in “direct gaming revenue” as gambling shifted from the racetrack to the tribal casino.

“The state receives 4 to 6% of tribal gaming receipts but receives 10 to 30% of horseracing gaming receipts,” Meacham wrote. “Therefore, state dedicated gaming revenues for education will also be harmed.”

In 2000, Congress passed the Shawnee Act, which restored the Shawnee Tribe’s federal recognition and gave it the right to secure land outside the assigned lands of other Oklahoma tribes. That meant much of the state was off-limits to the tribe, but property in Oklahoma County was available.

In 2005, tribal officials publicly discussed their desire to purchase land and build a casino in downtown Oklahoma City or Bricktown. By 2007, the tribe had a contract to buy property and announced plans to build a casino on 104 acres fronting Interstate 35 between Britton Road and Wilshire.

That effort drew opposition from the Remington Park racetrack and casino.

In a Feb. 28, 2008 letter sent to Meacham by Scott Wells, the general manager at Remington Park, Wells said the racetrack’s “business was negatively impacted by the opening of the Riverwind and Fire Lake Grand casinos in 2006.”

While that competition had been expected, Wells said racetrack officials did not expect to face competition from “a giant tribal casino 1.7 miles away from Remington Park ...”

Under legislation approved in 2004, slot machines at Oklahoma racetracks are taxed at rates between 10 percent and 30 percent. In contrast, under the various gaming compacts signed with tribal governments, the state receives only an “exclusivity fee” of 4 percent to 6 percent for slot machines at tribal casinos. The fee paid by tribal casinos is provided in exchange for the state barring competition in an area, which gives a tribal government monopoly rights to casino activity in that area.

In his letter opposing tribal casino operation in Oklahoma City, Meacham noted that if the proposed Shawnee Tribe casino lured gamblers away from Remington Park’s slot machines, state government would receive much less money due to the lower fee imposed on tribal slot machines.

The Shawnee Tribe’s effort to open an Oklahoma City casino fell by the wayside and the tribe eventually opened a casino near Guymon in the Oklahoma panhandle, more than 300 miles from the tribe’s headquarters in northeastern Oklahoma.

Meacham and Wells’ letters are both preserved in state archives.

The large gap in rates paid to the state on slot machines continues to be an issue and plays a large role in the current dispute between Stitt and tribal casino operators.

Tribal gaming compacts include language stating that each compact “shall have a term which shall expire on January 1, 2020.” Stitt says the compacts must be renegotiated before that expiration date, and has said the exclusivity fee paid by tribes should be increased to more closely match the rates paid in other states with similar casino markets. According to one estimate, 44 percent of tribal gaming compacts nationwide involve fees of 10 percent or greater, and Oklahoma’s casino market is far larger than most. Oklahoma is currently the nation’s third-largest state casino market and home to the world’s largest casino.

Despite the expiration date Stitt notes, tribal casino operators claim the compacts auto-renew every 15 years and have refused to negotiate.

United for Oklahoma, a publicity campaign funded by the state’s tribal casino operators that opposes renegotiation of the fees paid on slot machines, estimates tribal casinos’ total combined payments to Oklahoma state government since 2006 are more than $1.5 billion.

In addition to exclusivity fees, United for Oklahoma states that tribal casino operators also provided $80.5 million for tribal education programs, scholarships, and donations to Oklahoma education institutions in 2017. Combined with the share of exclusivity fee payments earmarked for education, the tribes report providing $198 million for education in 2017.

However, the amount paid through exclusivity fees and other forms by tribal casino operators is dwarfed by the payments that would have occurred had tribal casinos and racinos been placed on equal footing, records show.

In 2018 the 1,000 racino slot machines paid $24 million to state government. In contrast, the estimated 42,000 class III tribal casino slot machines paid a total of $119 million in state revenue share.

Broken down, that averages about $24,000 for each racino machine, but just $2,833 per Class III slot machine in tribal casinos. And tribal casinos pay no state fee on more than 28,000 Class II (Bingo-style) slot machines in their facilities.

Those figures indicate the state of Oklahoma would today receive payment of more than $1 billion annually from tribal casino operators had the fee on Class III slot machines in tribal casinos been equal to the rates imposed on the same slot machines in Oklahoma racinos, based on current per-machine averages.

In response to Stitt’s call for renegotiating compacts, officials with 29 tribal governments in Oklahoma signed a letter saying they believe the compacts “automatically renew” on Jan. 1, 2020 and that “rates under the present Gaming Compact should not change.” The chief of the Shawnee Tribe was among the signatories.

Republican Primary Results - State Treasurer

Click here for the entire Muskogee Politico series of election results maps.

Miller Endorsed by Watts (R), Meacham (D)

State Rep. Ken Miller (R-Edmond), a Republican candidate for State Treasurer, picked up two public endorsements in recent days.

Former congressman J.C. Watts endorsed Miller today, saying that "Ken Miller has the integrity, the conservative values, and the experience necessary to be Oklahoma's next State Treasurer. He is the right person at the right time to be Oklahoma's treasurer, and is clearly the most conservative candidate in the race. Miller is a proven conservative who has the rare distinction of actually cutting government waste." *

Watts was joined by another, rather unexpected endorsement. Sitting Democrat State Treasurer Scott Meacham told KTOK News that he had urged Miller to run for Treasurer. "I felt he would be the best person for the job", he told KTOK's Jacqueline Scott. Meacham was appointed to the position in 2005 by Gov. Henry, when the previous treasurer resigned.

The latter endorsement is likely to be a stumbling-block for GOP primary voters, especially in a year that is not friendly to Democrats or Democrat support. Look for the other Republican in the race, former State Sen. Owen Laughlin, to capitalize on this opportunity.


* I disagree with that statement, but that is for another post on another day.

Hime Slams Barresi for Donating to Democrats

A fundraising letter from Shawn Hime, Republican candidate for State Superintendent of Public Instruction, that hit mailboxes today is sure to spark a firestorm. The letter slammed his opponent, Janet Barresi, for donating to Democrat campaigns.

The text of the letter is as follows:

Do you want our party to nominate a candidate for state school superintendent with no classroom teaching experience? A candidate with no experience hiring and firing teachers?

Or -- in the case of my "Republican" opponent, Janet Barresi -- a candidate in our primary who supports convicted criminal Democrats with her own checkbook?

That's right.

My opponent, Janet Barresi, donated thousands of dollars to the Gene Stipe political machine.

These contributions are public record, available for anyone to see. But to save you the trouble of looking it up at www.ok.gov/ethics, I'll give you a brief summary right here:

• Donated to convicted former Auditor Jeff McMahan
• Donated to Treasurer Scott Meacham, promoter of Oklahoma's lottery law
• Donated to Sandy Garrett, current Superintendent of Schools

As you can see, Ms. Barresi likes to support liberal Democrats.

And we're not talking small contributions. Barresi's contributions to liberal Democrats total thousands of dollars.

The most disturbing contribution is the one she gave to Gene Stipe's lackey, Jeff McMahan, the disgraced former State Auditor who is now serving jail time for his criminal activities.

Now, after all of her support for liberal Democrats -- even one who is a convicted felon! -- Janet Barresi is running for statewide office as a Republican.

You read that correctly. Janet Barresi is actually running as a Republican, even though she's supported liberal Democrats to the tune of thousands of dollars in personal campaign contributions. If you're sick of "fake" Republicans like Janet Barresi trying to win office as conservatives, then I need your help.

As you can see, Ms. Barresi has plenty of money to throw around. In addition to giving thousands to liberal Democrats, she has given over $100,000 to her own campaign. That's $100,000 she'll spend, no doubt, trying to sell the lie that she's a real conservative who deserves to be elected.

Ms. Barresi, a dentist for the last 24 years, also will be selling the lie that she's qualified to run our schools. As the current Superintendent of Enid public schools, I have the practical experience from the classroom to the principal and superintendent's office. I've made the tough choices to balance a school district's budget. Janet Barresi has none of this experience but still claims to be our party's best choice.

I think you know better.

I don't have vast personal wealth to donate to my campaign. I'm running a grassroots campaign that relies on the support of real conservatives -- that's why I need your help.

I'm asking you to support me with a $500 contribution. Your contribution will help me fight Janet Barresi's money machine and get my message out to real conservatives.

You may not be able to give $500 right now. If you could contribute $250, $100, or even $50 it would still be a great help.

We can't afford to have any more "fake" Republicans elected to office. A Republican who donates thousands to liberal Democrats is not the kind of leader we need.

If you agree with me, then please send me your most generous contribution right away.

Than you for your support of conservative candidates. I hope I can count on that same support as well.

Sincerely,
Shawn Hime


P.S. I need your support to get the truth out about Janet Barresi. Ms. Barresi is running for school superintendent as a Republican despite lacking education experience and despite the fact she has contributed thousands of dollars to liberal Democrats.

I'm asking you to support me with a $500 contribution.

If you can't give $500 right now, please consider contributing $250, $100, or even $50. Every dollar you contribute will help me spread my conservative message and the truth about liberal Janet Barresi.

I pulled up the State Ethics Commission website, and Hime is absolutely correct about Barresi's contributions.

Barresi gave $250 to Democrat Scott Meacham (State Treasurer) in 2006, and $500 in 2007, for a total of $750. She gave $250 to Democrat Jeff McMahan (State Auditor) in 2006. To ironically cap things off, she gave $4000 to Sandy Garrett (State Superintendent) in 2006, and another $500 in 2007 to Garrett's 2010 campaign, for a total of $4500.

Garrett opted not to run for a sixth term, and Barresi announced her candidacy to replace Garrett [correction - Barresi got in before Garrett opted for retirement]. Hime got into the race several months after Barresi.

Granted, Barresi has not solely donated to Democrats. She has contributed $29,670 to Republican candidates since 2006, as opposed to $5500 to Democrat candidates. Although it may have been a much smaller percentage, as a Republican office-seeker, it doesn't look good to have donated to Democrats (in particularly, to the incumbent that you as a candidate are bad-mouthing).

Hime's political donations are much smaller. In 2006, he contributed $600 to a Republican District Attorney candidate, and in 2007 he donated another $100 to the same candidate. Then, in February of this year, he gave $150 to the Payne County GOP.

This race has been heating up, with Hime beginning to campaign more publicly, and Barresi supporters passing around rumors about Hime. With this letter from the Hime campaign, things are sure to heat up even more.


UPDATE: More information to come tomorrow...

Edmondson Considering Run for Governor

Attorney General Drew Edmondson has announced that he will not be seeking re-election to a fourth term as Attorney General, and expressed interest in a gubernatorial race for 2010.

He said Thursday his gubernatorial candidacy hinges on “the level of support that we find during 2009, the success of our fundraising effort and the reaction of folks as I visit them around the state.

“If it is strong, then I’ll make the race. If it is not, I’ll look at that third option [retiring to private law practice].”

Edmondson grew up in Muskogee, and was the Muskogee County District Attorney from 1982 to 1992. He was elected as Attorney General in 1994.

Edmondson has been rumored to be considering a run for Governor; other potential candidates include Democrats Jari Askins, Scott Meacham, and Lloyd Fields, and Republicans Tom Cole, Mary Fallin, and Randy Brogdon.

(H/t to McCarville)