Gaming Commission puts hold on license for ‘slot arcade’

Jackpot Joanie’s recently opened two new locations: one in Southern Highlands, the other in the Paradise area of the valley.

Over the past few months, the Nevada Gaming Commission has reluctantly approved licenses for “slot arcades” that seem more like subdued, miniature casinos than traditional bars.

That streak ended Thursday, when the commission voted 3-2 to refer a license application for a new Jackpot Joanie’s tavern back to the state’s regulatory staff for further consideration — a technicality allowing commissioners to avoid the alternative of formally rejecting the application.

Official license rejections can be a death sentence for a business in Nevada and other casino states, harming an applicant’s chances for future employment in the gaming industry and hampering the ability to do business with those in gaming.

Refusing to approve the application was an easy compromise for regulators uncomfortable with reversing previous votes in favor of such slot parlors but now reluctant to allow additional locations. The disagreement over the license also hints at the heated debate yet to come for the commission, which is scheduled to decide, once and for all, the thorny issue of whether to allow “slot arcades” as early as July.

The manager of the Jackpot Joanie’s location was frustrated because regulators had previously approved applications of other taverns, including Jackpot Joanie’s.

“When I filed this (application), never did I think we’d be debating this,” manager Ronald Winchell told commissioners.

The vote leaves Winchell’s application in limbo — a delay that could cost him the tavern license he received from the county last month and wipe out his investment in the bar, his attorney, John O’Reilly, told commissioners.

Winchell’s application could be approved automatically if regulators fail to take further action on his application within 90 days. At a meeting last month, the Gaming Control Board recommended that commissioners approve his tavern license.

Some commissioners expressed sympathy for Winchell, saying it wasn’t fair to him that regulators decided to change their minds after so many years.

“This man is entitled to rely on 25 regulators having done their jobs over 15 years” of approvals for slot arcades, Commission Chairman Peter Bernhard said. “Let’s amend the regulation, not change the rules midstream.”

Other commissioners said they had little qualms about seemingly derailing the application despite previous approvals of similar taverns. Commissioner Dr. Tony Alamo said he and other regulators were wrong to have approved such applications in years past. After visiting some of these establishments for the first time recently, Alamo said he could not, in good conscience, approve new ones.

“I examined the patient...and it is not a bar or a tavern,” he said. Under a two-decade old regulation designed to curb the proliferation of slot machines in Nevada neighborhoods, gambling must be “incidental” to a bar’s business for the tavern to quality for a slot license.

Rather than holding to a strict interpretation of the incidental rule, regulators have long presumed that taverns were eligible for slot licenses so long as they had obtained a tavern license from local authorities — regardless of a tavern’s appearance. By that standard, regulators approved licenses for hundreds of taverns that generate most of their revenue from gambling machines, whether embedded in bartops like traditional bars or from standalone machines like those in big casinos.

The state’s casino lobby, the Nevada Resort Association, began taking issue with that approach last year, saying “slot arcades” like Dotty’s and Jackpot Joanie’s bear little resemblance to the traditional bars envisioned under the original tavern regulation. Such slot parlors lack the social element of traditional bars, as they lack bartop slot machines, televisions for watching sports and counters where drinks are served, the association says.

Owners of Dotty’s and Jackpot Joanie’s have each filed lawsuits against Clark County to reverse an ordinance, adopted last month, requiring gambling taverns to operate more like traditional bars, with bartop games and restaurants.

The dispute may ultimately be decided in July when the Gaming Commission is scheduled to vote in change the tavern regulation to allow such slot arcades. The commission Thursday decided to schedule a vote on the matter after receiving a petition from the resort association that would force taverns statewide to look and operate more like traditional bars.

Commissioners expect to receive documents in opposition from the tavern industry, which has argued that some customers like places such as Dotty’s and Jackpot Joanie’s specifically because they don’t like the rowdy or boozy atmosphere of traditional bars.

The tavern issue is slated for discussion during the commission’s regularly scheduled meetings in June and July and will face a vote at the July meeting.

Gaming

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