Video poker debate lives on; Little River once dubbed Little Reno

In the 10 years since video poker ended its 21-year run in South Carolina, the industry's workers and casino buildings have been absorbed into the larger economy, but for some the topic has never gone away.

The Sun News has received scores of letters to the editor over the years saying that video poker should be brought back and other forms of gambling should be added as well. And every year since it ended, legislation has been introduced to bring back video poker. It never gained any traction.

Still, this political season, one candidate for governor made those initiatives the basis of his campaign.

Sen. Robert Ford, D-Charleston, sponsor of the perennial video poker legislation, promised that if elected, he would not only bring back what he said is a $3.5 billion video poker industry, he would collect $750 million in taxes from it and build a casino in Myrtle Beach as well.

Long a proponent of gambling and one who fought a state ban on casino boats, Ford used figures on video poker that had no basis in the history of the games. He came in third in a field of three seeking the Democratic nomination.

The facts are these: At its peak in 1999, the industry was valued at $3 billion in total economic impact, including profits and multipliers such as employee pay and purchase of goods and services.

Profits were just under $1 billion.

The state collected $60 million a year in fees and taxes from video poker operations. At a time when the state's budget was $5 billion, it was revnue that poker opponents were willing to sacrifice.

That's because studies showed the industry cost state residents $424 million in the social costs of gaming as well as money not spent on other goods and services.

If the public had voted for the industry in a referendum that never took place, the plan was to collect $180 million in taxes and fees. At the time lawmakers were debating the plan, some pointed out they could probably not impose higher taxes because the corporate income tax amounted to $150 million for the state treasury, and it was not fair to tax one industry so heavily.

The planned special referendum in 1999 that would have decided whether video poker should stay or go was nixed by the state Supreme Court as unconstitutional. The legislation setting it up said that if voters did not approve of the games, they would end at midnight June 30, 2000. The court ruled that part of the law was valid, so that's when the beeping and bipping of the machines went silent.

It was no loss to the state or its people, said the Rev. Paul Wood, who at the time was the pastor of Little River United Methodist Church. The church took a lead role in fighting video poker because the unincorporated village had turned into a place nicknamed Little Reno.

Because of its location near the state border, Little River became a center of video poker casinos and a group from the church began fighting the games in 1996. Many of that group have died or moved away, and Wood is now pastor of a church in Cheraw, but he has not forgotten the intensity of the video poker fight and the feelings against it.

The majority of people in the state wanted the games to go away and the letter writers who want video poker back "are people who themselves want to be gambling again in that fashion," Wood said.

"There was no social gain from it," he said.

Not only was Little River a busy spot for video poker, Horry County had the highest concentration of the machines of any county in the state. The county had 33,517 video poker machines in 8,106 locations at its peak. County residents dropped $283 million into the machines at its peak, more than one-fourth of what was bet statewide. The money was 10 percent of all the personal income in the county, amounting to $2,069 for every living person.

The industry, making its own case as the referendum approached, said 28,000 jobs would be lost. Some experts did not see that as a problem.

Tom Secrest, who was at that time director of Coastal Carolina University's Center for Economic Development at Wall School of Business, predicted the economy was strong enough, and the need for workers great enough, to absorb the job losses. He also said it would be an economic boost if people spent the gambling money on other goods and services.

Many people who relied on video poker for their income did lose out. Besides the casinos dedicated to video poker, many bars, restaurants and small stores that relied on the machines closed or changed hands.

But it was a hot real estate market at the time and the predicted glut of desolate, derelict video poker buildings did not come to pass, said Kal Kassel, a broker at Keystone Commercial Realty in Myrtle Beach.

The loss of video poker was not the real estate disaster some had feared, he said.

"I don't think anything really skipped a beat," Kassel said. "It happened at a time when the real estate market was really hot, everything at the time was going up and up and up."

If that happened in a market like today's, it would have been a very different story, he said.

Wood likes to think about the video poker casino in Little River that was taken over by a seamstress. Even more, he likes to think about the casino near Cheraw that became a church, he said.

Video poker had a storied and high-profile life in its 21 years, rising to prominence after a state senator slipped a provision in the budget one late night that allowed payoffs on the games. Lawmakers and the public battled over video poker for years, usually resulting in the games continuing to grow as operators found ways to work within the rules.

Legislators are still so skittish over video poker's furtive legalization and subsequent growth that they cannot agree on a measure to legalize charity raffles or living room penny-ante poker, both of which are illegal.

Lawmakers have fought for five years over bills to legalize those games.

Meanwhile, a similar scenario has played out in North Carolina. Despite banning video poker, betting games keep showing up again. In the recently-ended session, legislators voted to make it clear that a current version of video gaming is also illegal.

And in another wrinkle, during the last two years that the video poker war was under way in South Carolina, casino boats sailed in. They were declared legal under federal law, as long as they operated in federal waters, unless a state banned them, and S.C. lawmakers could not agree to do so.

So far, the only operations have been at Little River, although North Charleston is considering recruiting a casino boat to its docks.

"So Little River is still more affected by gambling than any other community in the state," Wood said.