Horizon, Host: Ted Simons

August 13, 2009


Host: Ted Simons

“Racinos”

  |   Video
  • As the State of Arizona faces a budget shortfall of more than $3 billion, lobbyists for dog and horse tracks are suggesting that Arizona can generate much needed revenue by allowing casino games at dog and horse racing tracks. But are “racinos” a good idea? Hear what Sheila Morago of the Arizona Indian Gaming Association has to say about the issue.
Guests:
  • Sheila Morago - Arizona Indian Gaming Association
Category: Government   |   Keywords: budget, arizona budget, casino, race tracks,

View Transcript
Ted Simons:
Casino games at race tracks is not a new idea. Voters defeated ballot measure in 2002 that would have allowed slot machines at dog and horse tracks. But times change and the budget deficit continues to grow, state lawmakers are looking for new ways to generate revenue. As David Majure reports, the racing industry is offering to help.

David Majure:
The state of Arizona is facing a current year budget deficit of more than $3 billion. Massive shortfalls are expected to continue for the next few years.

Speaker 1:
The bill makes general fund other fund, appropriations.

David Majure:
Meanwhile, state lawmakers are running out of options to balance the budget without raising taxes or drastically cutting services. But Arizona race tracks are riding to the rescue. They say they'll generate hundreds of millions of dollars for the state each year if given the right to operate casinos at existing horse and dog tracks. In exchange for that right, these racinos would give 45% of their gaming profits to the state.

Mark Brnovich:
Without a doubt, this proposal would be a game changer.

David Majure:
Mark Brnovich is director of the state department of gaming, which regulates Arizona’s Indian casinos. Tribes sign compacts in 2003 agreeing to contribute between 1-8% of their gaming profits to the state, depending on how much revenue they produce. Since 2003, tribal contributions have totaled more than half a billion dollars.

Mark Brnovich:
If gaming goes off tribal lands, the tribes will only be required to provide three-quarters of 1% per quarter, so we'll see that money immediately dry up as far as those about the 90-100 million dollars a year the state has been getting thus far.

David Majure:
Limitations on tribal casinos would also disappear. The result of a provision in gaming compacts.

Mark Brnovich:
Provision 3H is commonly referred to as the poison pill. It provides that if gaming ever does go off tribal lands, that the Indian communities can operate casinos without regard to the number of casinos, types of games, and as well as number of machines. In other words, it would open the door for full-blown Las Vegas-type casino gambling in Arizona.

David Majure:
He says any gambling, whether on or off reservation, must be properly regulated.

Mark Brnovich:
My primary concern is the director of a law enforcement regulatory agency is to ensure the integrity of gaming here in Arizona. The department of gaming works very closely with our tribal partners to ensure the integrity of gaming and it's very, very important that gaming be well regulated and we have a consistent regulatory structure throughout this state. As a student of gambling history and a student of history, as a former prosecutor, I know when gambling is not well regulated, it will lead to crooks, cheats, corrupting influences, which affects gaming throughout the state, whatever form it may take.

Ted Simons:
Joining me to stalk about the racinos and the proposal is Sheila Morago, executive director of the Arizona Indian gaming association. Good to see you. Thanks for joining us.

Sheila Morago:
Thanks for having me.

Ted Simons:
The idea of allowing casinos at tracks, taxing them or getting 45% of the proceeds, why is that a bad idea?

Sheila Morago:
Obviously we've already done this. You mentioned it before the break. Voters overwhelmingly said no to this proposal in 2002. Given three options, they chose the limited regulating scheme that we currently have in the state.

Ted Simons:
Voters said no to it but why do you think it's a bad idea?

Sheila Morago:
There’s a couple of things. One is, it changes the -- it's a game-changer for the state of Arizona. The voters said no, and we have limited regulated gaming. This is an agreement that took us three years to work out with the state. It's an agreement amongst tribes. One of the biggest things that we have in the state of Arizona is nongaming tribes. This will impact them the most. We have nongaming tribes in the bottom of the Grand Canyon, five in the state, and those people have transfer agreement was metro tribes that will go away. And they just can't afford to have that happen.

Ted Simons:
The other side will say that this will help the state avoid massive budget cuts, perhaps tax hikes as well. Your response to that?

Sheila Morago:
You know, any additional revenue is probably good, and that's what they're looking for right now. But in the long run, the numbers that the tracks are putting out right now really don't add up. Unless we find somebody to do an independent study on it, or an independent analysis on this, we've got to know whether or not it's worth the long-term repercussions to the state.

Ted Simons:
One of those repercussions would be lifting limits on tribes and what they can put in their casinos and what kind of games they can offer. Some would argue that would actually help the tribes open it up and whatever amount of slot machines that are wanted or needed or required our requested, go for it.

Sheila Morago:
That would be great if you have all great big market. If you look at the state of Arizona, there's only two markets that can hold multiple facilities. And that would be phoenix and Tucson. Again, we're talking about rule -- rural tribes and nongaming tribes. Those rural tribes in White Mountain t. Apache, even cliff castle in camp surrendered, they don't have those feeder markets. So you're talking about creating two really separate entities in terms of the metro tribes who could probably absorb some of that increase, and then the rural tribes who can't.

Ted Simons:
The tribes and their contribution to the state, the idea here is to help get money to the state. To keep budget cuts and tax hikes at bay. What do the tribes contribute to the state?

Sheila Morago:
The tribes contribute forever. If you looked way before we had gaming, when the state was first getting populated by non-Indians, they shared food, they shared water, they shared -- they took care of people as they were going across the state of Arizona to California and up into Utah. And always have shared. That's the culture we have in our Indian communities. But with the advent of gaming, we agreed to share some of our profits with the state in lieu, and in exchange for exclusivity. This is profits that our governments really need. If you look at the poverty in the Indian communities, we have centuries of poverty to overcome.

Ted Simons:
Some critics would say that number should be increased somehow, especially in these troubling times. Is there thought that there could be or should be some kind of an increase in that money going to the state, and would that be a wise move politically?

Sheila Morago:
Well, again, this was -- you have tribal communities who really need this money. They have very bad infrastructure problems. We still have the highest mortality rate than any given population in the -- in the nation, actually. And we have the highest rate of diabetes in the world in our Indian communities. So the money we get from gaming is to take care of those problems. And what we share with the state was a negotiated agreement between us and the state. Understandably, the state is in a world of hurt. But the question is whether or not the money that they're going to get or increases is worth the change in the state of Arizona.

Ted Simons:
Saying that the state is in a world of hurt, that also means a lot of citizens who might otherwise use casual income to go ahead and play whatever they want to play at casinos and tracks and whatever, that they're going to hold on to their money maybe more than they otherwise would. Again, anything that gets the economy in Arizona moving, does that not help the tribes, all tribes?

Sheila Morago:
It does. But we're seeing a decrease. We've seen a decline in our revenue stream for the last five quarters. We're holding steady right now, but when you have an industry that is totally dependent on everybody's disposable income, and people as you said just don't -- are holding on to that pretty tight, that is the end of the line. People, no matter how many options they have, they're not going to be letting go of that money.

Ted Simons:
So let's say, for example, let's speculate. If this were to actually happen, if the poison pill were taken and they go ahead and allow gaming at race tracks, how would the tribes respond?

Sheila Morago:
Well, immediately, add machines. But you've got to understand, we have machines that are still not in use. The full complement of the machines available to us are not in use because the population hasn't grown into those areas. So there's only going to be certain areas that we'll be able to increase those. The bet limits go up. More importantly, our revenue sharing creases to go to the state go down to one-quarter to 1% which is about to enough to make sure the department of gaming is still running. So that proven and stable revenue stream that education has seen that the health care industry has seen and the department of gaming and the office of tourism receives will go away. For a speculative revenue stream.

Ted Simons:
All right. Thank you so much for joining us. We appreciate you being on "Horizon."

Sheila Morago:
Thank you for having me.

Congressman Trent Franks

  |   Video
  • Congressman Trent Franks talks about health care reform, Federal stimulus dollars and other issues facing Arizona and the nation.
Guests:
  • Trent Franks - Congressman
Category: Government   |   Keywords: trent franks, health care reform, federal stimulus dollars,

View Transcript
Ted Simons:
Tonight on "Horizon," a congressional time-out allows congressman Trent franks to spend time in Arizona. What he has to say about health care reform and other issues facing our state and nation. And we'll take a look at a plan to generate much-needed state revenue by allowing casinos at dog and horse tracks. That’s next on "Horizon." Good evening, and welcome to "Horizon." I’mTedSimons. Maricopa county leaders have asked a judge for a temporary restraining order against the sheriff's office. This after sheriff Joe Arpaio’s deputies raided a county building yesterday and sized a computer system that serves law enforcement as welt as other county agencies. In April sheriff Arpaio sued the county for control of that computer system. That lawsuit is now working its way through court. Arizona congressman from district two, Trent Franks, will hold town hall meeting next week in Mohave and Maricopa counties. Tonight he joins us on "Horizon." Good to see you.

Trent Franks:
Always glad to be back here.

Ted Simons:
Let’s talk about these town hall meetings. First, it sounds like health care is the overriding topic.

Trent Franks:
It dominates the entire discussion. I suppose that ancillary there are a lot of fiscal considerations, but that ties into the whole discussion about the government takeover of health care.

Ted Simons:
Are these town hall meetings productive? I ask that because so much of what we see and hear is a bunch of yelling and a bunch of shouting. Are they productive?

Trent Franks:
I think the answer is yes, but I have to predicate that primarily on my own reaction. The people that have come to see me by and large have been very respectful, and we've had a good discussion. It is true that overwhelmingly those people have come to my office. Last Saturday we probably had over a hundred gather there at the -- my staff had called and said there would be a few people here; they want to thank you for opposing this. And the whole parking lot was full. We talked for an hour and a half. It was easy in my case because they were very happy with my opposition to the government takeover of health care, so I just haven't had the yelling and screaming that a lot of members have had. I suppose that's part of the equation.

Ted Simons:
When you see some of that yelling and screaming, what do you think?

Trent Franks:
Ted, I think everyone should be respectful to each other. True tolerance is not pretending we have no differences. It is being kind and decent in spite of those differences. That said, I can understand the passion and the intensity and the frustration that some people feel with government at times, and it's all right for government to feel that heat a little bit. Sometimes that helps us see the light.

Ted Simons:
There are critics that say some of these protestors, and that the louder voices that are yelling and shouting, this is somehow preordained, it's been planned, organized. It's not real grass-roots, they call it Astroturf. Your response?

Trent Franks:
I’ve heard that. Let me suggest I would strongly refute that. The people that have come to see me are mostly senior citizens. And small business owners, a lot of nurses. I haven't seen any sort of subterranean groups in there trying to stir up the waters, and I have to say, I think the reaction of these people is very real, and I’m sure that that is partly due to -- that I agree with a lot of the protests against the government takeover of health care. But I have not seen this Astroturf -- it's just not the case in my district. These are real people. They love their country and love their families and want a better future.

Ted Simons:
Your opposition to the house plan to the administration's ideas on health care reform. The major problems you have.

Trent Franks:
First of all, if I could, I would say I’m a cosponsor of the republican alternative. A gentleman in our state, John Shadegg, is what I believe to be the foremost expert in congress on positive health care reform. He's a republican, and consequently that helps me listen to what he has to say a little better. But he's written a bill, and a lot of us as conservatives have very adamantly joined with him because we think he has a much better plan. The republicans do have a desire to reform health care in a good way. But our reforms are based on trying to empower the individual. If someone cannot afford health care, and they want health care, there's a way for the government to say, ok, here's a draft or a tax credit, or something that empowers you to buy the health care insurance of your choice, and you're not only able to choose the company you want, but you can choose the doctor you want. And that increases competition, all kinds of good things. The alternative that the Obama administration has put forth is a government takeover, and that socializes health care a lot like -- I don't want to use too charged a word, but this is headed in the direction of the Soviet Union. They had government health care, everybody had health care. But it was certainly a sorry system.

Ted Simons:
Is it government takeover of the health care system? Or is it the government looking after those 40-some-odd million who don't have health insurance right now, to allow them to have the same kind of coverage that you and I have?

Trent Franks:
As I say, the republican alternative says government -- that government would allow those who don't have health care that want it, here is a draft for the same amount that everybody else is paying for their health care on the average, so it does that. It just don't say, hey, we want to come in and decide what kind of health care you get. We want all these panels and -- every time government has taken over anything, Ted, it has always been more expensive and more inhumane.

Ted Simons:
Is the idea of giving tax credits to the poor folks, does that mean they get the same level of health care that you and I get?

Trent Franks:
The same power as the average American, yes. See, my health care, everybody thinks congress has some sort of special health care. I buy blue cross and blue shield, I pay 100% out of my own pocket, and it's good insurance. And I just want everybody else to have that same option. And those who can't afford it, let's help them be able to forward it, but let's don't come in and say we're going to tell you how you're going to access that health care and what care you get. If we don't think this is the right procedure for you, then some government bureaucrat can say no.

Ted Simons:
You mentioned rationing care. Critics will say care is rationed right now by insurance companies. If the government gets involved, and provides competition as they see it for these private insurance companies, and it means more folks get covered, what's wrong with that?

Trent Franks:
What’s wrong with it is we have hundreds of years of history showing that when government socializes a given enterprise, that it always costs more and the quality falls, and the dignity of the patient or the person trying to access that need is diminished. And freedom is a pretty good bet. In America we all struggle for resources, but when we've had a competitive free market system where the poor had the same opportunities that the rich did, and that we at least made those opportunities the same, that created the best system for the least cost, and the most dignity for the individual.

Ted Simons:
Not to press too much on this one point, but in a competitive free market system, two people buy a house. The poor person buys this house; the rich person buys that house. Why would that inequality, why would that the no -- why would that not correspond to health care?

Trent Franks:
It is true; the wealthy have always been able to buy more than others. But the reality is, free enterprise is, as you say, sometimes been the unequal distribution of wealth. Socialism has always been the equal distribution of poverty. It just doesn't work. And it ends up hurting those on the lowest end of the scale most of all. Because in any government health care system, the pressure is going to be on giving less care. And a private health care system, when someone can come into your office, and you know they going to some other doctor if you don't do the right thing, and you're competing for their business, you want to try to naturally do the very best you can at the best price. It's a natural tendency. That's where the incentive and the pressure is. With the government health care system, all the pressure is on delivering less care and just hoping to survive the day.

Ted Simons:
The idea that the private sector -- again, the private sector has an opportunity right now to go after 40-some-odd million people who aren't insured. It's there for the taking there. Are people every day losing health insurance because they've lost their jobs or faced an illness, because of preexisting conditions, they can't get on to another plan. There are a variety of stories. If that exists right now, opening up the market even more so, how does that improve things?

Trent Franks:
That’s not the only thing the Republican Party plan does. The plan says here to those people who cannot afford health care, here is a refundable tax credit. This is money, this is cash that you can go and buy your private health care insurance for. And then all of a sudden the private sector then begins to compete for those dollars. And it helps everyone. All we're talking about now is the difference is whether government tells you how to do it or -- if government wants to help the poor, they can give money to the poor. We do that all the time. Yes should have a debate on how much that would be. But the bottom line is, once we've decided what resources we're going to offer to those who can't afford health care, whatever it might be, let's then let them take that draft or that voucher or that tax credit and access the private system just like anyone else would. And it empowers them and puts them in the position of being in charge of their own destine.

Ted Simons:
Last question on this particular point. The idea that a bureaucrat in Washington or a government person is going to make decisions for you or regarding your health care, obviously you're against that.

Trent Franks:
I am.

Ted Simons:
But there are those who say right now you've got bureaucrats in private industry making those decisions for you.

Trent Franks:
And that's a good point. The difference is, if you have the choice as to what insurance you can buy, if you are the one that is empowered to do that, the bureaucrat gets smart with you on the phone, you can say "tell your boss I’m going to another company. Nice day." and you can do that. But with a government bureaucrat, you have no choice. You either follow do what they say or you're out of luck.

Ted Simons:
For those without insurance right now, watching this program, and listening to you and saying, I don't know where to go, and this sounds nice, but right now none of these private insurance companies want me because I have preexisting conditions, what would you say?

Trent Franks:
The republican plan also deals with that with the preexisting conditions. That is a big issue. Under our plan, we create incentives for the state and additional help financially for the states to create these pools for those people who have preexisting conditions. And I’m suggesting to you that if I had a preexisting condition, or I couldn't afford insurance, I know what both plans are. And I would desperately want to make sure it was the republican plan that passed, because then I would know, ok, I’m going to be able to buy the health care insurance of my choice, and I’m going to be in charge. It's going to be a lot like my automobile insurance. If I lose this job or that, it will go with me. But I won't have to say to some government bureaucrat that doesn't know my name, please, sir, can I get dialysis for my kidney problems.

Ted Simons:
I can't let you go without the concept of Arizona school choice, and the trust that you are responsible for when you were in the state legislature. East Valley Tribune with the big blowout series on this, finding a lot of problems. First of all, did you read the series? What were your thoughts?

Trent Franks:
I thought the series made good points, but there was an overwhelming number of misnomers and misapplied pieces of information. And shall are a lot of things they left out. Originally this bill was to create additional choices for parents that wanted to choose an alternative education for their child. And it has been an amazing success in so many ways. Kids that have gotten these scholarships have done far better than they would have in the same setting if they had been left in some underachieving public school that didn't. And I think it's also made the public schools better. The competition has been good for everyone. There's been a lot of resources that will underscore what I just said. But the one point I think that should be made, and I hope this article, this investigative article will catalyze is a debate in the legislature, because the original legislation that I wrote simply said that these scholarships would go to children and that the children could use them at a school of their parents' choice. That the parents were the ones that decided which school to choose. And that the scholarship charities had to say, ok, we're going to scholarship this child, but once we do that it's the parents' decision where the child goes to school. One of two children -- one of two people, one of two people will decide what kind of education a particular child gets. Whether it be academic or spiritual or whatever it might be. It will be the bureaucrat who doesn't know their name or the parents who would pour out their last drop of blood for them.

Ted Simons:
As it stand with these trust organizations and the way we're hearing in these reports about abuse whether they're being earmarked for individual students, which is not supposed to happen, and a variety of other things, do you think there should be more oversight regarding the trusts? Do you think there should be a change in law? What should change?

Trent Franks:
I think the legislature ought to clarify what the original intent of the let's was. There was an amendment in that original legislation that kind of confused a few things. But I think it should be very simple. Most of the time those who have tax liability orthopedic wealthier in our society, and most of the time those who cannot afford a school other than go to the, quote, free public school that costs twice as much on the average as private school, then we just simply want to empower those who don't have that option, because right now rich parents can send their kids to any school they want. The poor cannot. And the original intent of this legislation, and it has gone a long way towards this end, was to encourage those wealthier in society to fund an alternative and to fund scholarships so children that weren't doing well in their existing school to be able to access something that would give them a better chance to walk on a higher road and a sunnier road of life.

Ted Simons:
Congressman, good to see you. Thank you for joining us.

Trent Franks:
Thank you, sir.

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