Jerry Kopel

Gov. Bill Owens signing of HB 1010 leaves me in a state of shock. HB 1010 is the bill allowing instant scratch games based on bingo. Such games were forbidden by the first lottery law in 1982 until now. The governor signed the measure on May 20th, long after the legislature had adjourned and with no possibility that the General Assembly could have overridden a veto.

This was the third time the bingo scratch bill had been introduced, all three times sponsored by Rep. Joyce Lawrence, R-Pueblo and Sen. Ray Powers, R-Colorado Springs. The 1997 measure was HB 1328. It passed the legislature and was vetoed by Gov. Roy Romer on June 4th. "....I am vetoing the bill to send a clear and consistent message about my beliefs on gambling to Colorado's citizens and the state's gambling interests."

The State Auditor has been fairly drooling over the prospect of scratch bingo. In October of 1997, he quoted the Lottery Commission "that an instant bingo game would generate at least an additional $24 million in sales...annually" and these "projections are conservative." That's a little more than the Legislative Council fiscal impact analysis, which consistently states the State Lottery Division expects an additional $6 million annually.

In 1998, the scratch bingo bill was HB 1113. It passed the House 51 to 10, but died in the Senate State Affairs Committee, probably because Romer was still governor and would have vetoed the measure again.

Bingo operators actually want scratch bingo. As the state auditor remarked in his 1997 report "There was little controversy about this bill (HB 1328). Representatives from the charitable bingo industry testified in favor of the proposed game."

The Legislative Council fiscal impact statement: "Thirty-three of the 38 states that have lotteries have introduced scratch games involving bingo. It is reported that these states have seen no decline in charitable gaming revenues from bingo as a result of the introduction of bingo scratch games." In fact, according to what one bingo lobbyist told me "studies in states with scratch bingo showed INCREASED numbers playing actual bingo."

Statistics gathered by Rachel Volberg in her 1997 study of problem gambling in Colorado displayed the lottery and bingo as big draws for compulsive gamblers. Putting the two together in the form of a lottery bingo is like lighting a match to a pool of gasoline, bound to hike compulsive gambling numbers. Legislative Council expects the bingo scratch game to be a $2 card, but there is no limit on what amount the Lottery Commission can charge for a scatch ticket.

The bill doesn't become law until early August. And it doesn't become part of the lottery until the Lottery Commission approves the game. If Gov. Owens is truely more conservative than Gov. Romer, as he claims when it comes to expansion of gambling, there is still time for word to be passed down to the Lottery Commission: "Don't do it."

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It's put up or shut up time for schools that offer the 168 hours of instruction needed for students taking the real estate licensing exam. Sen. Norma Anderson, R-Lakewood and Rep. Jack Taylor, R-Steamboat Springs, offer an unusual approach in SB 99 to answer criticism that too many persons sitting for the exam are failing.

Under SB 99, signed into law May 20th, the real estate commission is to obtain information from each school as to who attended, and who completed the courses. Then the commission will compile a list of who took the exam, which school they attended, and the percentage passing and failing for each school. The statistical data will be published quarterly (the exam is given each month), and made available to the public.

Proprietary real estate school courses (including correspondence courses) are approved by the Division of Private Occupational Schools under the Colorado Dept. of Higher Education. Most of the other schools are under the state board for community colleges and occupational education.

Slightly over half the persons taking the brokers exam are passing, according to data collected by the Dept. of Regulatory Agencies (DORA) in their 1998 Sunset review of the Real Estate Division. DORA did NOT suggest forcing the schools to comply with providing names stating "Such a law would represent a significant increase in regulation of the marketplace." DORA wanted to try a voluntary effort first.

The DORA report fails to mention how many of the 10,000 to 11,000 applicants per year are repeating the exam after having previously failed. Having run a review course for law students taking the bar exam, I am painfully aware that students who fail once, are apt to fail again.

Private real estate schools do compete for students and use passing statistics in ads. Students actually have a recourse now, although they may not know it. Under the Colorado Consumer Protection Act, it is a violation to "represent of a particular standard, quality or grade...if he knows or should know that they are of another." A lawsuit could force a school to reveal actual pass and fail statistics. If a student relied on a school's deceptive statistics, he or she should be able to recover damages.

No competing school wants to have a bad quarter with results published by the Real Estate Division. Any quality private school will now use entrance exams to weed out potential losers before taking their money and having them in class. So students who might not pass the exam except with the help of a quality school, will end up at either "bad" schools mentioned in the DORA report, (which schools won't weed out the "iffy" students) or non-private schools that can't lawfully refuse to accept a student.

Of course, the state has interfered in the marketplace before. The Dept. of Agriculture used to publish statistics based on nursery products sold in all types of retail outlets. It was truly amazing to read what your chances were of buying a plant for your home that had a chance of survival, depending on WHERE you purchased the plant. Those statistics are no longer published.

The DORA report also recommends putting real estate schools under the Real Estate Division and SB 99 sets up a study of transferring supervision of private occupational schools that only offer real estate courses from the Dept. of Higher Education to the Real Estate Division, with a report due by October, 2000.

Coincidentally, the state legislature will review the Sunset Report on Barbers and Cosmetologists in 2000. During the last Sunset review in 1991, the law was revised to TAKE private proprietary beauty and barber school jurisdiction AWAY that licensing board, placing those schools under the Private Occupational School Division under the Dept. of Higher Education.

Jerry Kopel writes a column for the Statesman based on 22 years past experience as a state legislator.


Gov. Bill Owens really had no choice but to allow HB 1187, which re-enacted the Bingo and Raffles Law, to become law without his signature. If no bill passed in 1999, the bingo statute would have completed a windup period and died, leaving only the constitution's "self-enacting" language, which is totally useless for any real possibility of regulation. We would have had "bingo without borders."

HB 1187 (Statesman, March 26) started out as a breath of fresh air and ended with a flatulent whiff. The bill, by Rep. Steve Johnson, R-Ft. Collins and Sen. Gigi Dennis, R-Pueblo, continues regulation by statute of the annual quarter of a billion dollar (that's gross, not net) bingo industry.

The original bill took discipline (suspension, revocation and hearings) away from the Secretary of State and gave that authority to a seven member Charitable Gaming Commission appointed by the governor. While dominated by the industry, the board did have two public members.

As passed, the law sets up a nine member advisory board with eight from the industry, and all members appointed by the Speaker of the House and the President of the Senate. No other regulatory board in the executive branch is appointed by the legislative leadership. This has to be a slap in the face of Gov. Bill Owens.

As I reported in March, even in its emaciated form, the board could have been a watchdog over the Secretary of State's supervision of bingo, except that the board's total budget is $4,900, a sum designed to pay for attendance at board meetings.

The board is required to "conduct a continuous study of charitable gaming, recommend statutory changes to the legislature, prepare an annual report regarding findings and recommendations" and offer various sorts of advice to the Secretary of State.

That's a lot to do for an advisory board with no director to prepare an agenda, no phone number people can call to obtain or provide information, and no separate post office box for mail. The board is totally dependent on the Secretary of State for any such expenses. Is Secretary of State Vikki Buckley going to provide staff to produce a board report critical of Buckley? The advisory board is a FARCE perpetrated on the public by the legislature.

There was one bright light.....maybe. Sen. MaryAnne Tebedo, R-Colo. Springs, chairman of the Senate State Affairs Committee, fought hard to put a lid on electronic pull-tab machines. Bingo lobbyists are unhappy, but they wanted a bill and were resigned to her determination and important effort. Or was she conned?

The definition of "pull-tab game" hasn't changed from previous law with tickets preprinted with markings revealing winners when the ticket is broken or torn apart. In the past, the player pulled the ticket out of a jar. But recently the industry has been using electronic machines that closely resemble casino slots, and approved by Secretary of State Buckley as "pull-tabs".

Tell me what this is: It's a machine that resembles a casino slot machine. You buy a pull-tab card that costs $5 or $20. You break open the card which contains bar codes or numbers and insert it into the electronic machine. Then you either pull the handle or push the button.

You get twenty "hits", and after each hit, the video reels of the machine are activated and you get three plums, three oranges, or something similar. The machine also tells you how much you won, if you won. At the end of the twenty hits, a paper comes out showing your winnings, if any. You take that to the cashier or person selling the pulltabs and get your money.

There is also a potential for corruption. Each batch of pulltabs contains a certain number of winners. When cashed in, the person selling or paying the winners, knows how many major winners have been paid from a particular pull-tab batch. If there are few winners or lots of winners left in a batch, the person selling or cashing in winning tickets can steer a friend to a pulltab from a "good" batch.

The industry uses "bingo" as a front for pull-tabs. The State Auditor's report in November, 1996 claimed "pull-tabs make up about two-thirds of gross receipts". The percentage is even higher now.

Rachel Volberg's 1997 report on compulsive gamblers in Colorado revealed such gamblers are five times more likely than social gamblers to gamble on bingo and pull-tabs, are significantly more likely to be women then men, and significantly more likely to be of African-American or Hispanic heritage.

The new law on pull-tab slot machines doesn't take effect until September Ist. The machine can still be used if it is "a device that merely reads or validates a pull-tab ticket inserted by a player, if the pull-tab ticket itself displays the winning or nonwinning status so that use of the device is not required". That means each pull-tab is going to have to clearly set out that information, which is usually not presently done.

Also, and (this is important) the device cannot be used in the manner that would qualify it as a casino slot machine under Article 18 of the state constitution.

If a player can get more "entertainment" out of slipping the pull-tab into the video slot machine, instead of just checking off the numbers, what do you think is going to happen? And what does "read or validate" mean? A rolling video screen turning up three plums or three cherries?

Of course, any regulatory statute is only as good as the person enforcing it. Secretary Buckley thinks these machines are fine; otherwise why would she approve them? If she doesn't want tight regulation there won't be any, regardless of language in the law.

Then it will be up to competing forces, such as casinos to challenge the bingo video slots as violating the casino definition of slot machines.

The next Sunset repeal date for bingo is 2008, which means, thanks to term limits, no one presently in the legislature will be there for the next round of debate on the issues, unless they are in the corridors as bingo industry lobbyists.

Jerry Kopel writes a column for the Statesman based on 22 years past experience as a state legislator.

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