Nebraska high court nixes gambling measure

Nebraska high court nixes gambling measure

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Atokad Park

Horses run at Atokad Downs in South Sioux City on Sept. 5, 2008. Ho-Chunk Inc. presented plans to a state regulatory board on Tuesday for a short horse track, sports bar and event center at the former Atokad site.

LINCOLN | The Nebraska Supreme Court dealt a major blow Friday to Ho-Chunk Inc.'s plans to develop a gaming and entertainment venue at the site of the former Atokad horse track in South Sioux City.

The high court ruled Nebraska voters on Nov. 4 will not have the chance to approve instant gaming machines at the state's horse tracks.

The justices found the ballot measure violated the state constitution against asking voters to cast one vote on two unrelated issues.

It's the latest defeat for backers of expanded gambling who have fought for years to put Nebraska on a more equal footing with neighboring states like Iowa, where casinos have been legal for more than two decades.

"I am so happy!" said Pat Loontjer, executive director of Gambling with the Good Life, who brought the court action. If the court had not granted her request, "The campaign was going to be horrible," Loontjer said.

Loontjer's group asked the Supreme Court to force Secretary of State John Gale to boot the measure, which the Legislature put on the ballot through passage of resolution LR41CA.

Lance Morgan, the president and CEO of Ho-Chunk, the Winnebago Tribe of Nebraska's economic development division, expressed frustration Friday with what he described as an effort to block direct democracy.

"I'm amazed how a few people can decide for everyone in our system," Morgan said. "The Legislature voted on it. They put it to a vote of the people. And it's been thrown out on a technicality that could have easily been interpreted the other way."

LR41CA contained two questions. One asked voters if the state constitution should be amended to allow at the horse tracks video terminals that permit bets on previously recorded horse races. The other asked whether tax proceeds from wagering on both live and recorded racing should be spent on property tax relief, schools, regulation and the state Compulsive Gamblers Assistance Fund.

In its decision, the Supreme Court said the question was whether the wagering "for property tax relief and education had a natural and necessary connection to legalizing a new form of wagering." The judges decided the answer was no, saying that the "only connection" between the appropriation and wagering proposals was to encourage voters to approve a new gambling game.

The instant gaming machines, as they've become known in Kentucky and Arkansas, have thousands of recorded races in their memory banks that have been scrubbed of identifying information. Supporters said the machines would generate revenue to support Nebraska’s ailing horse racing industry.

Opponents said the social consequences of expanding gambling far outweighed any gains and feared the machines could be the first step down a slippery slope of social decay.

Though disappointed with Friday's ruling, Morgan said Ho-Chunk will continue to push to change the state constitution so its plans for a casino and events center at the Atokad site can move forward.

"If anybody knows anything about us, we're resilient and we're focused, and we'll be back to try it again," he said.

After losing a bid in April 2013 to open a casino in downtown Sioux City, Ho-Chunk shifted its focus across the Missouri River to the Atokad property, which Ho-Chunk acquired after the financially struggling track closed in September 2012, ending 50 years of pari-mutuel betting.

The Atokad grandstands have been demolished, and no live races have been held there since then. But Morgan said Ho-Chunk officials were given assurances that the South Sioux City site would have been included in the tracks eligible for the instant gaming machines.

The Associated Press contributed to this report.

 

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