July 27, 2007 — Casino Control officials requested a reduction in their budget when testifying in budget hearings before the Finance Committee Friday in Frederiksted.
In Gov. John P. deJongh Jr.’s budget, he recommends $1.24 million for the commission. But Debra Audain, executive director of the Casino Control Commission, and Eileen Petersen, commission chairwoman, told senators they are actually requesting $1.02 million.
The Casino Control Commission is mandated by law to oversee the development of St. Croix’s casino industry through the implementation of a regulatory framework that permits and promotes stability and continuity in casino gaming operations. The principal regulatory powers of the commissioner are threefold: to ensure the character of casino workers, to accurately assess and collect taxes and fees for the casino industry and to foster and enhance the St. Croix hospitality industry. It oversees all permits, licenses and registrations for casinos and is responsible to be present at all times during casino operations.
The commission has sufficient revenues from other sources that it does not need the full amount, Audain said. She explained that gross-revenue taxes from casinos are deposited in the casino revenue fund, which is earmarked for an array of programs, including 10 percent to the commission. It received $293,000 from this fund through Finance.
The commission also has another source of funding, Audain said: the casino revolving fund, containing all of the licensing, permit, registration, slot machine and other fees. By statute, another $100,000 is automatically disbursed to the commission’s imprest account, and last year an additional $100,000 was disbursed for training of eight corporate directors involved with a current casino license applicant.
“It is for these reasons that the Casino Control Commission is respectfully requesting that its original fiscal 2008 budget request be amended to provide funding for personnel services and fringe benefits only,” Audain said. “As more casino operations emerge, the commission anticipates an escalation in revenues that will bring it closet to its ultimate goal of becoming a self-sufficient agency.”
The commission’s budget request was actually slightly less than the personnel and fringe benefit costs as presented by the governor’s budget and the Legislature’s post-audit report. Petersen said they had reevaluated some of their vacant positions and would not budget for them at this time. If they need the positions in the near future it will be because of new casinos, which would then provide the commission with more revenue, she said.
Petersen believes new casinos are likely in the near future.
“We know in the immediate future at least one or two casinos will come on board,” she said. “We are very optimistic. … As casinos come on board, we will ramp up and fill these positions.”
Sen. Terrence “Positive” Nelson questioned why establishments on St. Thomas with video lottery terminals are not regulated as casinos.
“Wyndham Sugar Bay Hotel: That is a casino in my view,” Nelson said. “There are hundreds of machines there. We can’t have these gray areas where people are sliding in under the radar. To me that’s odious, not only because of the revenues we are missing but the example being set.”
“I believe what has occurred was really not the intent of the senators at the time,” Petersen responded. “I strongly recommended at the time if they were going to permit VLTs, the Senate must first put in laws governing them, and if we don’t we will be running into trouble.”
Asked by Sen. Liston Davis if one body should regulate all gambling and gaming in the territory, Petersen said one body should and that all gambling should be taxed.
“I do not believe any gambling should be exempted from taxation,” she said. “I believe that is why you have gaming, so you can tax it.”
Petersen asked the Legislature to pass a bill to regulate compulsive gambling. Divi Carina Bay Casino has a self-exclusion system for problem gamblers, but Petersen said a law would benefit both casinos and gamblers.
“Compulsive gambling is normally regulated after a law is passed,” she said. “If a person feels he has a gambling problem, he may go to the casino commission and sign an application to be excluded. … If he attempts to go back to the casino, they can eject him, and if he refuses, charge him with trespassing.”
A law would give the casino immunity from lawsuits by gamblers who want to come back after signing self-exclusion papers, Petersen said. Without a law, she said, casinos face some liability.
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