Old starting boxes rust near the last greyhound track West of the Missouri River, in Tucson, Ariz. 17 September, 2011 (Photo by ST McNeil)
SOUTH TUCSON, Ariz. – Planks and pipes litter the floor under dusty betting stalls in the former clubhouse of the Tucson Greyhound Park. Floodlights bathe the track outside and pour through large windows into the empty hall’s shadows. The bar is closed, but the dogs still run. The mechanical rabbit silently flashes past, followed a second later by eight dogs running nearly 39 mph.
The United States outlawed most gambling in the war on organized crime, but a few exceptions have been expertly exploited: 73 million Americans lost $80 billion in them last year, according to U.S. News and World Report. Riverboat casinos and hyper-addictive online gambling have bloomed in the legal cracks created by states’ rights, but the biggest legal loophole for slot machines, roulette and card tables is in territory outside federal gaming regulations but inside the U.S.
“Tribes were not given the right to engage in casinos – because it wasn’t explicitly taken away,” said Stephen Cornell, a professor at the University of Arizona and faculty associate for the Native Nations Institute for Leadership, Management, and Policy. He has studied Indian and American gaming for decades and co-founded The Harvard Project on American Indian Economic Development.
While gaming is a part of ancient indigenous culture, modern Indian gaming began in the 1970s on reservations in Maine and Florida.
“No tribes owned casinos 50 years, or even bingo operations,” Cornell said. “A few tribes realized they could get into the gaming business. There had been things like church bingo for years, but the state had put limits on that. The tribes basically said we can run high-stakes bingo because these regulations don’t matter to us.”
The clean, fast-paced and high-tech Indian casinos expanded quickly across America and Arizona in 1987 after the Supreme Court’s decision on California v. Cabazon Band of Mission Indians.
“The court ruled not whether gambling was good or bad, but that the tribes could do it. They felt they had to be responsive to the states [so] they ended up with a compromise between the states and the tribes,” Cornell said. It would be up to state legislatures to permit and tax the tribes’ games through “compacts”. Tribes asserted themselves across the nation and demanded complete freedom in their nations from federal and state limitations on gambling.
The Yavapai Nation’s annual Sovereignty Day parade celebrates this right, in what could be called their Alamo. On May 12, 1992, FBI agents seized 349 slot machines in a raid on the reservation. The feds won the battle that day, but the Yavapai won the war with an astute public relations campaign centered on sovereign rights. Between Flagstaff and Phoenix, their modern casino has 23 kinds of keno and will host Kenny G’s new band three times this month.
Nineteen tribes have legal gambling contracts with Arizona, and they paid $90.5 million in taxes to the state this year on the profit from their 22 casinos, according to the Arizona Department of Gaming. According to the National Indian Gaming Commission, 422 Indian casinos made $26.5 billion across the nation last year.
“Whoever is currently in a market like that hopes no one else gets in,” Cornell said. “That’s just standard business practice.”
Tribal gaming skyrocketed across the US, and attendance and purses plummeted at racetracks.
“As the Indian casino numbers grew, and as what they offered grew more and more sophisticated, we saw competition for the gaming and the entertainment dollar,” said Wendy Davis, associate coordinator for the University of Arizona Racetrack Industry Program. With horrible dog-abuse headlines and rising property values, this led to East Coast-track owners to close most of the state’s tracks: Tucson is the last of Arizona’s seven.
But when the Yavapai and the FBI were squaring off in Arizona, a new concept was born out east which could save, or destroy, greyhound racing in the state.
There is a quibble over the birthplace of the first racino. Was West Virginia first in 1993 with video lottery terminals, or was Rhode Island in 1994 with traditional “one-armed bandits”? Either way, this type of “off-reservation” gambling proliferated like Indian casinos: 43 racinos operate today in 11 states, from Maine to Florida, Iowa to Delaware. For the most part, these two systems developed on opposite sides of the map: the majority of the racinos lay east of the Mississippi River and two-thirds of the new Indian casinos are, like the reservations, west. However, 42 percent of casino revenue comes from the east, while New Mexico got 26 percent of it’s gambling tax from its five horse-racinos.
Racinos do well, according to Richard Thalheimer, a former University of Kentucky professor and an economist who specializes in gaming. He found that the Charles Town, W. Va. racino increased its daily purses, or prize money, from $27,000 to $166,000 between 1995 and 2005, employed 3,700 people full-time, and profited $428 million last year. But all is not well out east.
Rhode Island’s pioneering greyhound racino no longer races dogs.
Fortunes from slots led to more games at Twin Rivers racino, and it spent millions expanding as the owners lobbied successfully for increased exemptions to federal and state restrictions on gambling. Legislators courted more profit: gambling taxes are the state’s third-highest source of funds. Casinos, racinos and the lottery paid out $345 million to Rhode Island last year.
The racino’s owners then asked to cut the “racing” part of the racino regulation. Locals were outraged: one resident told the New York Times that he felt the racino concept had been a “ploy” to slip in casinos. Rhode Islanders voted against legislation to curb the casino side of the racino in 2007. Two years later, Twin Rivers demanded 24/7 business hours to stave off bankruptcy. The greyhound track closed a year later. The state was too broke to let the casino close, and the casino was too broke to keep running the greyhounds.
Part of the reason the racino failed was that adding a casino to a track moves betting dollars from dogs and horses to machines, wheels and tables. Like the competition between casinos and racetracks which crippled Arizona’s greyhound industry, Thalheimer estimates that introducing slots by themselves can cut pari-mutuel, dog and horse, bets by 20 to 40 percent.
But so far, Twin Rivers is an exception. Racino expansion is one of the top trends in national gambling, according to industry researchers at Spectrum Gaming. More racinos are coming.
“It’s going to be a tough row to hoe,” said Davis, as she recounted when 80 percent of Arizonan voters in 2002 cast ballots against moving gambling off the reservation. “This has come before the voters before, and it was soundly defeated.”
The difference now is the global recession which has caused a spike in suicides across the nation and a state fire-sale of assets. Looking at Arizona’s state lottery, which has generated nearly $2.7 billion in 30 years, could deregulating gambling help pay the costs of government?
Arizona’s top Republicans, State Majority Whip Steve Pierce and House Speaker Andy Tobin, think more non-native gaming, racinos specifically, could soothe debt woes, said Scott, the race announcer.
The state might already have enough gambling options, Cornell cautions. Any more could cut into established markets, not create new ones. But the racino lobby is offering the state more of a cut than the tribal compacts, said Taylor, the racetrack manager. He said racinos will give 30 cents of every dollar bet to Arizona’s budget, estimating $800 million to a $1 billion statewide if tracks reopen and retrofit as racinos. The surplus benefits of more visitors, like restaurant tabs and employment opportunities, in cities rather than reservations, could buoy a state with an $8.5 billion debt.
“A lot of these states are thinking, ‘Hey should we expand,’” Cornell said. “If they can keep themselves out of the hole they’re in, on the backs of gamblers, that’s what they’re going to do.”
The announcer Scott is adamant. Between bouts of rapid-fire enunciation of race coverage, he explains “the thrill of a greyhound running.” After a cigarette, he returns to his booth perched over the bright track’s empty seats.
“I’ve announced literally thousands of greyhound races. These are real athletes out there – they know how to win,” he said. “It’s the fastest sport alive.”
