The Big Bad Gaming Bully Returns


by Rick Langenberg:




Despite winning several key court victories and receiving strong support from Colorado gaming officials, the city of Cripple Creek and Teller County still can’t rid themselves of the Gilpin County/Black Hawk menace.

As a result, the financial future of limited stakes gambling in the area may be at risk, or at least the ability of local governments to pay their bills and lose $2.5 million in revenue collectively a year.

According to Cripple Creek City Administrator Ray White, Gilpin County officials are slated to make another attempt to “steal” more gaming tax monies from the governments of Cripple Creek, Teller County and Central City. Only this time, Gilpin, which is supported by Black Hawk in this effort, is taking a side legislative route and may get a little help from state elected leaders. A state Senate bill dealing with the sunset of the gaming law, which is typically approved in a status quo manner, may come equipped with an amendment that could have dire financial consequences for local governments in Teller County. “They are trying to do legislatively what they couldn’t do in court,” said White, in describing the ongoing campaign of Gilpin to change the way gaming revenues are distributed to add more monies to their coffers. “We are very concerned. We are back fighting Gilpin County again. This would have a very significant economic impact on us. It is not good news.”

Since the beginning of gaming, revenues have been distributed through a defined percentage system, based on the amount of adjusted gross proceeds generated in the various gambling town. These proceeds basically amount to the winning take of casinos.

But Gilpin has argued that the state revenue should be dispersed, based on which areas pay out the most tax dollars. Through this latter system, Cripple Creek, Teller County and Central City would emerge as big losers, while the governments of Gilpin and Black Hawk would receive a substantial hike in gambling monies. Gilpin officials say that since the lion’s share of gaming taxes are paid by casinos in Black Hawk, they should get more revenue.

Gilpin government manager Roger Baker, the main person spearheading the plan, has tried unsuccessfully to change this revenue allotment through requests made through the gaming division staff, the gaming commissioners, the Denver District Court and even the Colorado Court of Appeals. In each case, Gilpin’s funding bid has been staunchly denied. “They have ruled that the current way of allotting the gaming revenue was correct,” said White. According to White and Teller County Attorney Chris Brandt, the original gaming law authored in 1991, heavily favors the stance taken by Cripple Creek and Teller County.

Last fall, White and elected leaders in Teller County thought the dispute had finally reached a conclusion when the Colorado Court of Appeals denied Gilpin’s bid to appeal an earlier court decision by the Denver District Court. “We won and they lost,” reported White in an earlier council meeting last fall. Some have even touted this as a ‘David versus Goliath’ struggle, since the big mammoth casinos are located in Gilpin County.

Prior to this verdict, the Colorado Limited Gaming Control Commission and the gaming division staff ruled against Gilpin County. Moreover, many officials noted that if Gilpin’s interpretation of the law was correct, then the stage could be set for many historic buildings in the gaming towns to be demolished.

But unfortunately, White concedes that Gilpin isn’t throwing in the towel and is worried that they are trying to change the original gaming law through a slick legislative tactic. And with a Democratic-controlled state House, Senate and Governor’s office, White fears Gilpin officials may get a more receptive audience. “They are just not giving up,” said White, who suggested that certain Gilpin leaders are motivated by outright greed.

According to White, Cripple Creek officials are closely monitoring this legislation and aren’t quite ready to unload their political weapons. He said city officials should know by the middle of this week what type of battle they may face against Gilpin County and Black Hawk.

If Gilpin gets their way, White estimates that Cripple Creek could lose $1 million-plus a year, which is similar to what Teller County may lose, under the pending legislation. And that wouldn’t take into account the potential loss of more historic preservation funds, as a result of this change, which may total more than $500,000 a year.