La Crosse Tribune: Bill would tax video gambling machines

MADISON - A Coulee Region legislator is laying odds that legalizing video poker machines could be a nice jackpot for the state's revenue coffers.

At the same time, Rep. Terry Musser, R-Black River Falls, said legalizing the machines would help clarify the law that has changed in the past year.

A bill last session decriminated video poker machines, provided an establishment did not have more than five units at one location. Violators are subject to a $500 fine per incident but can no longer lose their liquor licenses over the issue,

"Right now, we have put law enforcement in an untenable position," Musser said.

Musser said he will push to have the measure introduced at the Joint Finance Committee or in caucus after the Legislative Fiscal Bureau has calculated the potential state budget impact.

A bill proposed in 1995 projected that-taxing video poker machines would raise nearly $300 million per year in general-purpose revenue, which would just about offset the projected $650 million revenue shortfall for the next two-year state budget cycle, Musser said.

"If those numbers hold, that would take care of our budget problem, plus take care of the locals," Musser said.

Local units of government could receive an estimated $40 million total annually under the proposal, Musser said.

Musser concedes that legalizing the devices would amount to an expansion of gambling, but he said he would prefer to raise revenue that way than to continue raising fees on activities such as camping and hunting and raising taxes on items such as liquor and cigarettes.

Tomah Mayor Ed Thompson, who owns Mr. Ed's Tee Pee supper club in Tomah, was out of town Monday and unavailable for comment. But in a January 1999 article in the La Crosse Tribune,

Thompson said video gambling should be legal.

"The smart thing to do would be to have it supervised and regulated and have it taxed," Thompson said.

Thompson was one of 40 Monroe County tavern owners who faced charges related to illegal video gambling after a raid in December 1997. The district attorney could not seat a jury that would convict Thompson on the charges, so they were dropped.

Thompson, president of the Monroe County Tavern League, was highly critical of that 1997 raid and helped elect a new Monroe County district attorney in place of the one who engineered the gambling raid. Thompson also was critical of a recent state raid that found 80 illegal gambling machines in truck stops and gas stations, including two businesses in Monroe County.

While tavern owners now face only a civil fine, truck stop and gas station owners face criminal prosecution for a Class E felony, with a fine of up to $10,000 and possible jail time.

If Gov. Scott McCallum doesn't support the proposal, the governor should come up with alternative ways to raise the revenue, Musser said.

Musser said he thinks the idea has a realistic chance of approval if further savings or revenue sources aren't found.

"At some point in time, if there's going to be a balanced budget, there's going to have to be revenue from somewhere," Musser said.

If video poker machines are legalized, Musser said, there could be a backlash from Wisconsin tribes, which have exclusive rights to gambling under the terms of compacts negotiated with the state. The tribes may stop making payments to state government if that happens, said Musser, who serves as chairman of the Legislature's Special Committee on StateTribal Relations.