Station Casinos CFO Marc Falcone wasn’t showing his cards in yesterday’s conference call with analysts. He would only say that, in the wake of Proposition 48‘s defeat in California, Station and the North Fork Rancheria of Mono Indians would explore “other methods of obtaining a compact” in the greater Fresno area. Does this mean Station and 
the Mono Indians will settle for a Class II facility? They went the Class III route once before and got shot down by the electorate. They could try another location but the voters are likely to take the same dim view of “reservation shopping” as before. Or the Mono Indians could build on their primary ancestral lands but that’s pretty far off the main drag and it doesn’t enjoy reservation status.
It was a good quarter for Station, with revenues up 2% and modest losses of $30 million due to interest on its $2 billion debt. Cash flow was up yet again (14 straight quarters, with an increase of 12% this time). Falcone said what few would: That the Las Vegas locals market remains subdued in its spending, an admission that is perhaps easier to make when the last 14 months for Station have seen above-market-average 7.5% growth in gaming revenue, compared to the larger market’s 2%. “We’re seeing a younger clientele and we expect to see a smidgen of improvement in spending levels in other areas of the property,” Falcone added of Red Rock Resort.
Evidently in a candid mood, Falcone allowed, “Needless to say, the online gaming market has been a considerable disappointment.” The company shuttered Fertitta Interactive in New Jersey, where its alliance with Trump Taj Mahal went bust. However, the company continues to make money the old-fashioned way, with tribal-management fees up 49%.
* The Michigan Gaming Control Board was saving up a whole armload of sanctions for MGM Grand Detroit, unloading a cumulative $350,000 in fines on the property. It was 
quite a laundry list of misfeasance, running the gamut from underage gambling to evading bidding rules, not to mention using unlicensed vendors. But the eyebrow-raising fine was a $150,000 levy for embezzlement that occurred back in 2007 (!). Regulators blamed the slow enforcement on having to wait for a police investigation to take its own sweet time. “The idea behind moving on these actions and moving on the fines is to modify behavior. If it takes six years to get this thing resolved,” complained Chairman of the Board Robert Anthony. “Are we just playing a game where the regulators have to regulate and the casinos have to be regulated?” If MGM isn’t smarting from the punishment then certainly the $688,000 embezzled from its coffers must hurt a bit.
* Sen. Harry Reid (D) may try to get an online-poker bill through the Senate during the lame-duck session but Old Sixty Votes didn’t have any luck with it four years ago and 
he’s got even fewer votes this time. Some i-gaming observers suggest that a House Judiciary Committee “hearing would be held simply to appease [Sheldon] Adelson, and may be more symbolic than substantive.” You know, a pat on the head to a nice old man and a thank-you gesture to a campaign benefactor. I’m not buying it. Taking a victory lap, Adelson’s not going to quit now. Also, Sen. Lindsey Graham (R) and Rep. Jacob Chaffetz (R) seem dead serious about rewriting the Federal Wire Act to put Internet gambling out of John Q. Public’s reach.
Lame-duck Rep. Steven Horsford (D), meanwhile, lashed out at Adelson surrogate Wellington Webb, writing, “the notion that somehow Congress can simply legislate this problem away by instituting an ill-advised ban on all online gaming nationwide is ridiculous … When Bobby Kennedy drafted the Wire Act back in the 1960s, the purpose of the legislation was to fight the evils of illegal gambling and organized crime, not to stifle innovation or inadvertently promote an illegal black market for online gaming … We simply cannot turn off the internet or pretend that this technology does not exist.” Voters didn’t see fit to give Horsford another term in Washington but at least he’s going down fighting.
