Promoters of a plan to bring slot machine gambling to the nation's capital vowed yesterday to mount an aggressive petition drive to put their proposal before D.C. voters on the November ballot.
At an initial hearing before the D.C. Board of Elections and Ethics, lawyer John Ray and businessman Pedro Alfonso said District residents should decide whether to allow them to build a $510 million "family-oriented entertainment complex" with as many as 3,500 slot machines. The complex would be built on a stretch of New York Avenue NE near the National Arboretum and would include restaurants, a "marquee hotel," theaters and a bowling alley.
The development -- which would offer as many slot machines as the biggest casinos on the Las Vegas strip -- would create 1,500 permanent jobs, construction contracts for local minority firms and an attractive place to take children in a neighborhood otherwise starved for economic development and family-style amenities, according to a packet of materials distributed to reporters.
It also would generate an estimated $765 million a year in slots profits, of which about $190 million -- or 25 percent -- would be offered to the District government to fund city services.
Gambling analysts have said that the financial arrangement would be among the most lucrative deals in the country for a private slots operator. While Las Vegas resorts and some Indian casinos pay 25 percent or less in taxes, states more recently have demanded as much as 71 percent of slots profits.
"I think folks are looking for some true positive changes on New York Avenue, and this has all the things people are looking for," said Alfonso, chief executive of the telecommunications firm Dynamic Concepts and a lead investor in the proposed development.
Alfonso's group has started selling its vision, dubbed the Capital Horizon Entertainment Complex, to the public. Ray, a former council member and mayoral candidate, said his group decided to seek a spot on the ballot because it knew the D.C. Council would never approve a development project that includes any form of gambling. Noting that the D.C. Lottery was also created by referendum, Ray said, "what better example of democracy than letting the voters decide?"
The proposal is generating significant opposition. Yesterday, at least a half-dozen ministers, community activists and businessmen showed up to plead with the elections board to keep the matter off the ballot, arguing that slot machines would bring crime, prostitution and addiction to a neighborhood already overwhelmed by all three.
"The money from these proposals never gets where it's supposed to go," said Willa Kynard of the United Methodist Women, who dismissed promises of new jobs. "If you want to set up something for the District, fine. But does it have to be gambling?"
To place the issue before voters Nov. 2, Alfonso and his partners face a race against the clock. District law requires them to collect the signatures of 5 percent of the city's registered voters -- about 17,500 people -- by July 6. And they can't hit the streets until the elections board gives them the green light, a process that could leave less than a week to gather the needed signatures.
That process hit a snag yesterday, when the board postponed until Wednesday a decision on whether the slots proposal meets the legal requirements for a referendum. The law, for example, prohibits initiatives that would violate the U.S. Constitution or the city's Home Rule charter, or would require spending city funds.
The board ordered the delay to give its general counsel, Kenneth J. McGhie, and the public time to review revisions submitted by Ray and Alfonso late last week. After a cursory examination of the new language, McGhie said he expects to recommend that Ray and Alfonso be allowed to proceed with the petition drive.
"It can be done," McGhie said when asked whether they can make the fall ballot. "It all depends on how organized they are."
From all appearances, Alfonso and his allies are well organized. The group has created a finance committee to raise money for the petition drive and plans to hire professionals to collect the needed signatures, said Ann Walker Marchant, a public relations consultant.
Although professional petitioners almost derailed Mayor Anthony A. Williams's 2002 reelection campaign by submitting thousands of fraudulent signatures, Walker Marchant, who served as Williams's campaign spokesperson, said the process this time "will be airtight. Every signature will be scrubbed internally."
Alfonso said, "It would be a challenge . . . but we will give it every attempt to get it on the ballot in November."
During the past two months, Ray said he and others have presented their plans to city leaders, including the D.C. Chamber of Commerce, the Minority Business Coalition, the Hotel Employees and Restaurant Employees International Union and several advisory neighborhood commissioners in Ward 5, where the complex would be. Several of those organizations sent representatives to the elections board meeting yesterday or submitted written testimony in support of the referendum.
"We're talking about a $500 million project on New York Avenue. Everyone who has seen this project loves this project," Ray said.
Ray took issue with those who object to the introduction of slot machines in the District, saying the proposal would legalize "video lottery terminals," a relatively new form of gambling in which consumers do not "bet against the house" but instead "play against a pool of other players."
"It's like Powerball," Ray said. "It is not a slot machine. It looks like a slot machine. But it is not a slot machine, and the courts have determined that."
Gambling experts, however, said the difference between casino-style slots and video lottery terminals is largely a legal distinction.
"What they're trying to do is come up with a word that's more politically acceptable. Slot machine has a harsh sound to it," said William N. Thompson, a professor of public administration at the University of Nevada-Las Vegas. "It's all public relations."