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Correction to This Article
A July 13 article about congressional opposition to slot machines in the District mistakenly said Rep. Frank R. Wolf (R-Va.) chaired a panel that recommended a national moratorium on gambling in 1999. Wolf sponsored legislation that created the National Gambling Impact Study Commission.

Lawmakers Say Congress Won't Allow Slots in D.C.

By Spencer S. Hsu and Lori Montgomery
Washington Post Staff Writers
Tuesday, July 13, 2004; Page A01

Congress will halt any attempt to bring slot machines to the nation's capital if a referendum is placed on the November ballot and approved by voters, two influential members predicted yesterday.

Northern Virginia Republican Reps. Frank R. Wolf, chairman of a U.S. commission that recommended a national moratorium on gambling in 1999, and Thomas M. Davis III, chairman of the Government Reform Committee, delivered a clear signal to colleagues and D.C. officials that the unfolding voter initiative faces opposition in Congress, whatever its fate in the District.

Rep. Davis predicts lawmakers "are not going to want to vote for slot machines in the nation's capital."

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"Under no circumstances do I think gambling should come to the District of Columbia, period," said Wolf, a House Appropriations subcommittee chairman.

"Can you see coming to see Arlington National Cemetery, the Tomb of the Unknown Soldier, President Kennedy's grave, the Washington Monument, the Capitol, the Supreme Court, and first we go by the Lucky Five gambling casino? It would be horrible," Wolf said.

Davis said that he does not want slots in the District and that "members are not going to want to vote for slot machines in the nation's capital."

Calls last evening to spokesmen for Del. Eleanor Holmes Norton (D-D.C.) and D.C. Mayor Anthony A. Williams (D) were not returned.

Both lawmakers stopped short of vowing to block the measure themselves and said in interviews that the District referendum process should go forward. But they said it is inevitable that Congress would execute its jurisdiction over the federal city, either in the District's annual budget or, more likely, in separate legislation this year.

Congressional opposition marks the latest hurdle for the initiative, whose supporters submitted 50,000 signatures to D.C. election officials last week in hopes of winning a spot for the gambling initiative on the Nov. 2 ballot. The initiative would authorize the installation of 3,500 slot machines, formally known as video lottery terminals, on a 14-acre site at New York Avenue and Bladensburg Road in Northeast Washington.

Opponents plan to challenge the legality of the petition drive. The D.C. Board of Elections and Ethics has until Aug. 5 to determine whether the requisite 17,599 registered D.C. voters signed the petitions.

Washington area members of Congress said they saw a potential "silver lining" for the District if the measure passes in November: leverage in the city's ongoing claim before Congress for an increased federal payment in lieu of a commuter tax. Slots backers say the machines would generate $765 million a year in revenue; they have promised to pay a fourth of it -- $190 million annually -- to the District.

"What I would do in the city's behalf is say to Congress, 'You don't let us tax income at its source. You don't let us tax federal buildings. . . . But if you won't let us do these other things, then give us the revenue," Davis said, elaborating on his prediction on gambling as first reported on WTOP radio yesterday.

Another House member from the region, Rep. Albert R. Wynn (D-Md.), said he opposes any effort by Congress to overrule the District. Wynn added that resort-style gambling would create another reason to approve casino gaming in Maryland, which he advocates. Gov. Robert L. Ehrlich Jr. (R) has tried for two years to persuade lawmakers to legalize slots at racetracks.

Neither the District initiative's general counsel, former D.C. Council member John Ray, nor one of two investors in the project, D.C. businessman Pedro Alfonso, returned a call seeking comment. The other investor is Rob Newell, a financier from the U.S. Virgin Islands.

Opponents embraced the remarks of Wolf and Davis. District activist Dorothy Brizill praised Davis for "trying to be very respectful to the District of Columbia by not coming in with a heavy hand to intervene" and Wolf for being "around long enough to know the worst of the District, meaning corruption and mismanagement."

"I live in a city that can barely regulate building permits and alcohol beverage control licenses," Brizill said, adding that it was "a stretch" to think the city could effectively oversee gambling.

Separately yesterday, supporters disclosed raising nearly $700,000 for the slots campaign, all of it from Newell's companies in St. Croix.

The bulk -- $592,700 -- came from North Atlantic Investments LLC, of which Newell said he is sole owner. An additional $79,759 came from Bridge Capital LLC, of which Newell said he is chief operating officer.

Bridge Capital is jointly owned by John K. Baldwin and gambling promoter Shawn Scott, who in April first pitched to Ray the idea of bringing slots to the District. Scott has been denied or failed to obtain gambling licenses in five states where regulators found evidence of financial mismanagement, irregular accounting practices and hidden partnerships.

Ray said he banished Scott from the D.C. campaign after learning of his background. At the time, Ray said Scott provided none of the funding for the political action committee that was formed in support of the slots referendum. Ray later conceded that he does not know whether Scott and his associates have a continuing financial interest in the proposed entertainment complex.

According to the PAC's campaign finance report, all key local figures associated with the effort received payments from Newell. Alfonso, the sole local investor in the project, has received $18,000 in consulting fees. Ray has received or is owed more than $187,000 in legal fees.

The committee also paid $60,000 to PCI Consultants, a Santa Monica, Calif., firm that managed the recent petition drive. And it paid dozens of D.C. residents directly for "petition circulation." A few received as much as $5,000.

Staff writer Serge F. Kovaleski contributed to this report.

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