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Sunday, June 16, 2002

By Vicki Smith, The Associated Press

WHEELING, W.Va. -- All around Donna Connor, the machines sing. Thousands of them. Constantly ringing and pinging, they form a hypnotic, electronic melody punctuated by the clatter of coins.

Every few months, that song calls Connor to Wheeling Downs Racetrack and Gaming Center, where she spends the day and as much as $400 on the slots.

"It's an escape, more or less," says the arthritis-riddled retiree from Butler. "I know a lot of people want to go to Las Vegas, but for me it's just too much. Too much to choose from."

Connor favors the small casinos in Tunica, Miss., but they're too far away. So when the mood strikes, she and her friends drive two hours to Wheeling or to Mountaineer Race Track & Gaming Resort in Chester.

"We don't come here to win," she said, "because chances are, we won't."

But West Virginia's gambling halls are winning more than ever, and with expansions under way at all four racetracks, the profits will only climb.

Twelve years ago this weekend, on June 8, 1990, the Lottery Commission allowed Mountaineer to install up to 165 terminals. It was an experiment designed to save jobs as racing's popularity plummeted.

Since then, the tracks have become major tourism attractions, generating an ever-larger stream of revenue with an ever-larger number of slots.

Of the 21 million tourists who came to West Virginia in 2000, at least one-fifth, or 4.3 million, went to the racetracks.

Mountaineer and the Charles Town Races & Slots alone are projecting a combined 6 million visitors this year.

In fiscal 2001, gamblers plunked more than $5.1 billion -- almost twice as much as the state budget -- into 6,200 slot machines. After payouts and administrative costs, net revenues totaled $433.7 million.

And in March, gamblers put almost $57 million into the machines, setting a single-month record.

The growth is expected to continue. The state Lottery Commission has given its approval to requests that will push the number of slot machines at the tracks to 11,000.

The owners of Mountaineer, Charles Town, Wheeling Downs and Tri-State Racetrack & Gaming in Nitro have spent millions to get where they are, but they're now spending hundreds of millions more to position for competition from neighboring states.

Kentucky lawmakers just rejected a bill to allow slot machines at racetracks, but supporters plan to resurrect it. Similar legislation is being floated in Pennsylvania and Maryland.

West Virginia planners envision everything from a riverside shopping center and golf course in Chester to an outdoor amphitheater or sports arena in Nitro.

There are no limits on the number of machines a track can have, and the Racetrack Video Lottery Act appears to have been crafted to let the house win. As long as the Lottery Commission deems more machines "in the best interest of the tracks, the commission and the citizens of West Virginia," expansions are approved.

The commission stands ready to deny a request, Lottery Director John Musgrave says. So far, it has not.

The market will determine when enough is enough, he says.

"The commission can decide either way, but if there is determined to be a need, they're going to take a look at meeting that need," Musgrave said.

Even the staunchest opponents have all but abandoned hope of stopping the growth.

Mike Queen, chairman of the Coalition Against Gambling Expansion, went to every Lottery Commission hearing for two years, objecting to requests for more machines.

"But now there's no use," he said. "There's not enough people in West Virginia who want to fight the system."

Queen and others say the commission is a rubber stamp for the track owners -- owners so confident that they begin construction projects months before the go-ahead for more machines.

"We have a commission that doesn't regulate; they only endorse and promote gambling in West Virginia," said the Rev. Robin Crouch, pastor of First Baptist Church in Wheeling.

About $147.5 million from slot profits went to the state in fiscal 2001, up from $95 million the previous year. Over the years, the money has helped fund everything from parking garages and veterans' memorials to senior programs, tourism and teacher pay raises.

Two percent of the profits goes to the county and local governments that host the tracks, adding up to almost $8.7 million last year. And, the tracks make countless donations.

"They are a group of people we can go to in a time of need, when we can't quite afford something," said Charles Town Police Chief Mike Aldridge, who has gotten equipment, support for his DARE program and money for a narcotics dog. "Charles Town Races has been a great neighbor."

And despite the year-round influx of gamblers, the tracks have not caused an increase in crimes often blamed on casinos: prostitution, drug dealing and robbery.

"If there was an increase in crime, I'd be the first to tell you," said Ranson Police Chief William Roper.

In some ways, the development mirrors Las Vegas. Slots are in play for all but a few hours each day, as early as 7 and as late as 3:30 a.m.

Although some tracks offer day trips by bus within West Virginia, all rely on out-of-state gamblers.

"When you get people to come to your community, drop some money and leave, that's the best situation in the world," said Paul Mills, a Ranson city employee who supports Charles Town's growth. "They don't use your schools and city services, but they eat and shop here."

If slot machines are approved in neighboring states, some patrons would stay closer to home, and West Virginia's growth rate would slow.

To combat that, Mountaineer President Ted Arneault is starting to build support for legislation that would allow blackjack and other table games -- something gamblers consistently request.

But that's not where the money is.

Since the early '80s, slot machines have overtaken table games, accounting for two-thirds of casino revenue nationwide.

"Table games are much more complicated to manage," said Don McGhie, an industry consultant in Reno, Nev.

"Square footage-wise, you can make as much money or more on table games, but it would require a lot more management," he said.

Arneault says table game dealers would earn $40,000 to $50,000 a year, attractive salaries at places that have already become magnets to jobless people.

The four counties that host the tracks all have below-average unemployment rates. When their expansions are done, they will employ a combined 4,700.

"If you look at the demise of the steel industry, you see that Weirton Steel went from 13,000 employees to a little over 3,000," said Tamara Pettit, a former legislator who sponsored the law allowing slots. "Someplace has to absorb those workers, and Mountaineer has become the place to absorb them.

"At the time, we were just trying to hold the status quo," said Pettit, now Mountaineer's marketing director. "The idea that it would be used as a linchpin and this place would totally explode didn't enter my mind. I truly did not see the magnitude of it."