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NM gaming expansion gets wary reception in Santa Fe

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Sen. John Arthur Smith, D-Deming, top, speaks Thursday about the history of gaming legislation to, from left, Rick Baugh, general manager of Sunland Park Racetrack and Casino, Scott Scanland, a lobbyist, and Ethan Linder, marketing director at Sunland Park. (Eddie Moore/Albuquerque Journal)

Copyright © 2020 Albuquerque Journal

SANTA FE – A plan to bring “Las Vegas style” gaming to New Mexico by allowing the state’s five racetrack casinos to serve alcohol on casino floors, venture into internet gambling and stay open 24 hours will not be easy money at the Roundhouse.

In the first hearing on the sweeping proposal to open up New Mexico’s state-regulated gaming system, several members of a key legislative panel said Thursday they are skeptical about the idea.

“I think what we’re trying to do here, we’re going the wrong way,” said Rep. Harry Garcia, D-Grants, who voiced concern about a potential rise in drunken driving cases and other alcohol-related incidents if the proposal is ultimately approved.

He also said several tribal leaders have expressed opposition to the plan, due to its potential impact on tribally owned casinos.

However, officials with Sunland Park Racetrack and Casino, one of the five racetrack casinos in New Mexico, said the plan is still in its early stages and changes could be made to it before it’s brought before lawmakers during a 60-day legislative session that starts in January.

They said it would attract more tourists to New Mexico from neighboring states, boosting state tax revenue and job levels along the way.

“By allowing us to expand our operations, we think we can increase the revenue pot for the state of New Mexico,” said Ethan Linder, Sunland’s marketing director.

Some members of the Legislative Finance Committee said the plan should be explored, citing a need for additional revenue sources amid the ongoing coronavirus pandemic and a recent drop in oil prices.

“If this is going to be an economic development tool, let’s do it,” said Rep. Javier Martinez, D-Albuquerque, who said legislators would need assurances about the tourism claims.

Under current state law, racetrack casinos are limited to 600 slot machines each and can operate up to 122 hours a week, which translates into 16 hours a day, as long as horse racing or simulcasts of horse races are offered at the associated racetrack.

Those limitations would be removed under a draft of the so-called “Gaming Recovery Act,” although the racinos would still contribute a percentage of profits to the racetrack purses.

The proposed gaming expansion would also allow racinos to have an unlimited number of video slot machines, table games and on-site sports betting parlors.

Expanding the operations of New Mexico’s horse racetracks and racinos could also prompt revisions to the state’s gambling compacts with Native American tribes, which produce nearly $80 million a year in revenue sharing for the state.

The Sunland Park Racetrack and Casino officials, citing a racino-funded study, said the revenue generated by the changes would more than offset those losses, while also leading to larger purses for horse races.

But LFC analysts said the draft proposal is likely to lower state revenues – a concern shared by some lawmakers.

“They always say we can get to these numbers, but it never seems to happen,” quipped Sen. George Muñoz, D-Gallup.

New Mexico’s nontribal casinos have been closed since March under a state public health order. In response, racinos have had to furlough hundreds of employees and have urged Gov. Michelle Lujan Grisham to allow them to reopen at limited capacity.

Under the state’s compacts with casino-operating tribes, only six racinos are allowed in New Mexico. The five existing racinos are in Hobbs, Ruidoso, Farmington, Albuquerque and Sunland Park.

State horse racing regulators last year decided not to grant a sixth license, after proposals were submitted for new racinos in Tucumcari, Lordsburg and Clovis.

Rick Baugh, the general manager of Sunland Park Racetrack and Casino, acknowledged after Thursday’s hearing that backers of the idea need to have more conversations with tribal leaders and lawmakers in the coming months.

“I think it went exactly as we thought it would,” Baugh told the Journal regarding the legislative hearing. “This is step one.”


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