Third try for gambling initiative thrown out

Posted: Wednesday, November 30, 2005

Three times they've busted, but the sponsors of a plan to legalize video gambling in Alaska aren't ready to fold.

Lt. Gov. Loren Leman for the third time this year denied certification of a ballot initiative to legalize video lottery terminals, machines that allow players to wager on games of chance from poker to slots and keno.

The sponsors, headed by Victoria Scott, the mother of a Las Vegas investor in casinos and racetracks, have been rejected each time for the same reason: the initiative is unconstitutional because it would create a special law for one area of the state.

Anchorage attorney Ken Jacobus, Scott's lawyer and a co-sponsor of the initiative, says plans are already in the works for a fourth try, and he will submit a new version of the initiative within the next two months.

Scott's initiative is written so that just one person or group could be licensed to run a video gambling hall in a borough with a population of more than 30,000.

The initiative maps out just one gaming district that would be created if voters passed the initiative: an Anchorage parcel of property that Scott has an option to buy.

"Therefore, it appears an almost certainty that the owner or the option holder of the south Anchorage property will have a monopoly on video gaming within Anchorage," Assistant Attorney General Michael Barnhill wrote in his Nov. 23 opinion to Leman.

"It is precisely the kind of unwarranted special benefit contemplated by the constitutional prohibition on special and local legislation," he wrote.

Besides Anchorage, only Fairbanks and Juneau are big enough to be eligible to have gaming districts. They would have to hold special elections to allow video gambling hall licenses to be issued there.

Jacobus said the main point of contention is whether Anchorage should be considered a municipality or a borough. The sponsors say it's a municipality and the limit is on one gaming district per borough. That means Scott's Anchorage property would not prevent another district in the borough from being licensed, so there is no monopoly, according to the sponsors.

Jacobus said the disagreement should be easy to fix but if the proposal continues to be denied, the sponsors will consider suing the state.

That will happen "when it becomes impossible for me to tweak it any more to make the attorney general happy," Jacobus said. "We're going to get it in as good a legal position as possible before we go forward (with a lawsuit)."

Jacobus said time has run out for the sponsors to get the proposal certified, collect the signatures and then get those signatures certified in time for the November 2006 general election.

The next general election is scheduled for 2008.

Scott is the mother of a Shawn Scott, a Las Vegas investor and former racetrack owner in Louisiana, New York and Maine who has pushed for gambling initiatives in other states. Victoria Scott has said her son is not involved in the Alaska gambling initiative.

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