Sports wagering kiosks approved for Golden Gaming

Nevada gaming regulators decided Thursday to allow taverns owned by Golden Gaming to use high-tech sports wagering kiosks operated by bookmaker Leroy's, but will spend the next 22 months deciding whether the devices violate current gaming law.

During more than two hours of back-and-forth testimony, which included several impassioned outbursts by Leroy's Chief Executive Officer Vic Salerno, the Nevada Gaming Commission voted to allow the sports wagering kiosks to operate in the taverns after it learned that 15 of the Golden Gaming businesses had been using the machines over the past two weeks.

"We probably could have saved a lot of time if we had known these were already operating," gaming commissioner Randolph Townsend said before the 3-0 vote to allow Golden Gaming and Leroy's to share in the revenues from the kiosks.

The licensing agreement expires in July 2013, which gives the gaming industry and regulators time to decide whether the kiosks are actually a gaming device.

Gaming Commission Chairman Pete Bernhard said that if the kiosks are considered a gaming device, they might violate regulations limiting restricted gaming locations to 15 slot machines.

"This doesn't make sense to me," Bernhard said. "This seems like a full-fledged sports pool, which can't go into a restricted location."

The kiosks, which have been used by Leroy's since 2007, were originally designed to allow customers to place wagers in locations away from typical casinos, as long as they have money on account. The kiosks were being used in Buffalo Wild Wings and the Inn Zone Lounges. Customers would have go to a Leroy's sports book to cash winning tickets or open accounts.

However, technology has evolved, allowing customers to deposit money at the kiosks and collect winning tickets on the spot.

Also, at Golden Gaming locations customers would be able to open wagering accounts.

Nevada Resort Association officials said earlier this week that the lobbying group was concerned the terminals and their expanding technology were blurring the distinction between nonrestricted gaming sites, such as hotel-casinos, and restricted locations.

Resort association President Virginia Valentine attended the gaming commission meeting, but didn't testify at the hearing.

When the three commissioners participating in the hearing -- Joe Brown recused because of a conflict of interest and John Moran Jr. was absent -- openly discussed application denial, Salerno became incensed.

Leroy's and Golden Gaming spent more than $1 million to develop the technology, which he said would increase the number of sports gamblers and grow tax revenue for the state. When told the commission might approve the revenue sharing without allowing the feature to let customers open accounts, Salerno gave the commission an earful.

"If you do this, it's going to really stifle this industry," Salerno said. "This would kill it. It has to be convenient. We're trying to bring (technology) out that is new. I can't believe it. I'm very disappointed."

In the end, attorney Scott Scherer, representing Golden Gaming, suggested a two-year license to allow the tavern operator and Leroy's to move forward while it was determined whether the regulations or statutes needed to be changed.

Salerno said Leroy's had an undisclosed exclusivity agreement with Golden Gaming for the use of kiosks, which allow tavern customers to become Leroy's customers. He said the kiosks could be used in other nonrestricted locations.

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871.
Follow @howardstutz on Twitter.