In two weeks the Dec. 28 deadline for applicants for gaming licenses in Pennsylvania will have passed. Then the real fun begins. The debate will be robust but confusing -- until an award of a license for a slot casino in Pittsburgh actually takes place, the people making headlines almost always will be advocates arguing what they think is their best case.

	John G. Craig Jr., former editor of the Post-Gazette, is president of the Southwestern Regional Indicators Consortium and a member of the Pittsburgh Gaming Task Force (jcraig@ucsur.pitt.edu). The opinions expressed here are his alone.

As this public entertainment unfolds, keep in mind that this is a high-stakes affair. The business being proposed is expected eventually to generate annual revenues of $400 million and employ 1,500 people in good-paying jobs. By any recent measure those are big numbers for a new Pittsburgh enterprise. When you append to that the peculiar nature of the business -- slot-machine gambling with its particular demands on the social environment -- this clearly is a very big deal indeed.

Complicating matters will be two areas of primary tension. State and local government are in a rush to get licenses awarded and gambling under way because they are primarily interested in getting their hands on the additional tax revenue.

Hurry, hurry, hurry is their watchword and they already have made it clear to the state Gaming Control Board they want the board to award licenses as soon as possible. Local government in Pittsburgh and Allegheny County, financially far-gone as they are, also have already built gambling revenues into budgets. They will be no help either in a more deliberative process.

Haste, however, is absolutely the last thing that should interest us Pittsburghers -- unless you see the public interest going no further than the end of your nose, as in next year's tax bill.

We are going to be stuck for years with the outfit that gets the local franchise. We should care before all else that it has a proven record of accomplishment in the casino business and that it is making a significant investment in its Pittsburgh operation.

We also need to know what rate of return it will demand of that investment over what period of time. The Gaming Control Board will examine these matters. But there is no reason, on the basis of what has occurred with riverboat and other gambling outside Nevada and New Jersey, to count on them to execute those evaluations as exhaustively as we Pittsburghers would if the decision were ours to make.

To point this out is not to find fault, but to state the obvious. The seven-member Control Board has a state rather than regional perspective. Its primary responsibility by law is to assure that the commonwealth's interests are well-served.

This means before all else assuring that all gambling operations in Pennsylvania are owned by corporations and operated by individuals of impeccable reputation, the proverbial clean hound tooth. Secondarily, that the licensees have sound business plans, a demonstrated capacity to make good on them and can provide tangible evidence that they will work for what is "best for their new home community."

As good as all this is, it remains a one-for-all approach that assures a certain amount of generalizing, which means, in turn, that comprehensive analysis of specific provisions in specific places will be circumscribed if not foreclosed.

This will occur, to repeat, in an environment where the board's bosses are urging it to make haste. Award all 14 licenses as soon as possible, don't dribble them out a few at a time over the next two or three years as circumstances might suggest. (At the moment, it appears that a one-day award of all licenses for which there is an eligible licensee is the board's goal, but that is not firm.)

This region's interests on the other hand are parochial. The Lehigh Valley and Philadelphia are markets that could just as well be Oklahoma City or Orlando for all we care. Our worst fear should be schlock, a business that looks flashy at the start but very soon is cutting corners and foreswearing amenities in order to get by.

We do not want to wake up in 10 years and find that we have the gambling version of the East Hills Shopping Center on one our beautiful riverbanks. And be in no doubt, that is a real worry.

That may seem overly negative. The gaming business in America is doing very well, as the very robust price/earnings ratios of publicly traded gaming company stocks suggest. Wall Street is as good a barometer as we are likely to get on business prospects. The available evidence suggests that applicants for a Pittsburgh license will include a number of successful, publicly traded companies. So far, so good.

But there is another very important financial reality: Pennsylvania's 54 percent tax rate on all gaming revenues.

For comparison purposes, the rate in Nevada is just over 6 percent, in New Jersey, 13 percent and the Midwest states between 20 and 30 percent. These levies are a regular expense of doing business, just as are costs like machine rental fees and payrolls.

For crude comparison purposes, if our hypothetical $400 million Pittsburgh company were operating in Las Vegas, it would owe $24 million per year to the state of Nevada compared with the $216 million here. That is a huge differential!

It is also a fact, however, that despite such a differential in a very large fixed cost, there are going to be a number of companies interested in operating a casino in Pittsburgh.

Why? Slots-only operations are significantly cheaper to run because of lower labor costs; Pittsburgh is a very attractive market. It is urban; there is no gambling in Ohio and West Virginia does not yet have table games; the profile of the potential adult gambling population within 75 miles of the center of the city is very positive in the view of marketers. And, finally, even at a 54 percent tax rate, it appears to the pros that gambling will still pay.

So what might we expect from our Pittsburgh business?

The best guess of Alea Advisors, the Philadelphia consultant hired by the Pittsburgh Gaming Task Force, on which I sit as a representative of the Riverlife Task Force, is cash flow between 1 and 11 percent. (For purposes of this analysis, we are talking EBITA -- the term for "Earnings Before Interest, Taxation and Amortization.")

A ballpark figure on where our Pittsburgh casino would be on EBITA once it reached $400 million is somewhere around $40 million. That's a nice number -- but still means that the investor is going to need close to a decade to get even.

Thus, no matter how big the dollars that are going to be talked about, there is nothing about a Pittsburgh casino that is a slam dunk.

For these many reasons, we need to be ruthlessly aggressive in the coming months in our own, local examination of the applications once they are made public soon after the first of the year.

We should keep up the pressure on Harrisburg every step of the way. We should insist in every way possible that what the applicant promises the Gaming Board it intends to do is actually something that it does and that the board puts in place provisions to make the Pittsburgh promises ironclad.

These provisions should cover all "add ons," additional promises, if such there be, to provide Pittsburgh additional dollars beyond those required by statute for some other local social purpose.

Finally, temporary casino facilities for the licensee to "get started" should be resisted unless they are accompanied by irrevocable commitments upfront on a permanent facility within three years. A licensee may develop in stages, but he should develop well and for the long pull.