Posted on Tue, Sep. 02, 2003

GAMBLING AND TOURISM: Games go on at tribal-owned casino, for now

By RICK ALM
Columnist

They look like slots and play like slots, but the 152 "Reel Time Bingo" games offered at the new, tribal-owned 7th Street Casino in Kansas City, Kan., may not be slots.

The Wyandotte Tribe of Oklahoma opened the downtown gambling joint Thursday morning after a seven-year legal battle that is far from over. For the moment, however, the tribe has the upper hand in court, and neither state nor local authorities appear to have a legal leg to stand on to close the place.

So for now the games will go on. But what are they?

Last year in Oklahoma the National Indian Gaming Commission outlawed an earlier generation of the game, called MegaNanza, because it failed to pass muster as legitimate Class II tribal gaming. Class II games, including bingo and pull tabs, do not require state approval.

Class III gaming, which requires consent of the state, includes casino card and dice games and standard electronic devices like slot machines and video poker found in Kansas' four Class III tribal casinos north of Topeka.

When tribes do not or cannot win state approval for a Class III casino, as the Wyandottes in Kansas haven't, they typically choose less lucrative Class II casinos, which are almost beyond the reach of state and local law enforcement.

That's what's happened in Kansas City, Kan., and scores of other states.

And a cottage industry of slot manufacturers has sprung up to supply Class II gaming tribes devices cleverly engineered to play like Class III games.

One such company is publicly traded Multimedia Games Inc. of Austin, Texas, which manufactures Reel Time Bingo — successor to its outlawed MegaNanza game.

Multimedia vice president Skip Lannert contends that Reel Time is a legitimate Class II gaming format because winners are decided in a bingo game that is played and displayed in a corner of each machine's video screen.

However, most of that screen is simultaneously filled with standard spinning slot machine reels in familiar game themes such as "Jackpot Party," "Filthy Rich" and "Reel 'Em In," which are offered worldwide, including in Missouri.

"The spinning reels are just a more entertaining way of showing the result of the (bingo) game," said Lannert. That remains to be seen.

In a settlement of a lawsuit stemming from last year's MegaNanza dispute, the National Indian Gaming Commission is analyzing Multimedia's Reel Time Bingo game to determine whether its gambling odds and mathematics fall under Class II bingo or Class III slot standards.

However, the federal agency is examining Multimedia's latest generation of Reel Time programming, dubbed 2.0.

An earlier generation, called the 1.2 programming version, is the game being played here and in other states. To date, 1.2 has been neither studied nor challenged.

If the 2.0 version is approved as Class II bingo wagering, casinos are expected to switch to that programming. If not, 1.2 is likely to face similar scrutiny.

Lannert said Multimedia had an estimated 7,500 1.2-version Reel Time Bingo games in play and leased to more than 70 tribal casinos in seven states through confidential revenue-sharing agreements with the tribes.

All machines are linked to a central program in Tulsa, Okla., where the winners are determined.

Players compete with one another in bingo-game groups of 15, but they are never aware of that.

In fact, said Lannert, at any given moment a player in Kansas City, Kan., may be playing against 14 other players in Oklahoma, California, Arizona, Alabama, New York or Wyoming.

Regulatory conflict

Wyandotte Chief Leaford "Flying Eagle" Bearskin appears to be a slot neophyte.

During opening ceremonies Thursday, the chief played the casino's first official dollar himself.

He played for only a few minutes, but with apparent success. He walked away leaving $11 worth of credits on the game.

That vignette helps to illustrate the vast difference between tribal and state-regulated commercial casinos.

And that difference is why The Kansas City Star will not include 7th Street Casino revenues in its regular monthly report of legalized gambling activity in the area.

Had a Missouri casino CEO played his own company's slots, he would have been hauled onto the state Gaming Commission's uncomfortable carpet for some explaining and a fine, if not state-license revocation.

Tribal casinos, on the other hand, are self-regulated by tribal members who also are the beneficiaries of casino profits.

In an age of political correctness, few dare term such arrangements as unconscionable conflicts of interest. But that is exactly what Congress allowed in its hopelessly flawed Indian Gaming Regulatory Act of 1989.

Under that loophole-riddled train wreck of federal law, tribal gaming commissions are neither accountable nor accessible to the general public, whom — with their wallets — tribes so warmly invite into their reservation gambling parlors.

While state-regulated commercial casinos must report all manner of financial and gaming data in the bright sunshine of public disclosure, it is not so for tribes.

7th Street Casino officials said that tribal gaming commission meetings would be closed to the public and that monthly casino revenues and average slot machine payback rates would not be made public.

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To reach Rick Alm, call (816) 234-4785 or send e-mail to ralm@kcstar.com.