Relief for Nevada’s restricted gaming operators wasn’t a perfect solution By Howard Stutz, Executive Editor, CDC Gaming Reports August 11, 2020 at 8:00 pm Someone visiting a Nevada tavern lately might assume the place had been burglarized. In many locations, bar tops now have gaping holes where slot machines once sat. Last month, Gov. Steve Sisolak announced a directive that shut down standalone bars and bar top areas inside taverns and restaurants as part of the COVID-19 mitigation effort. Positive coronavirus tests had surged, and the governor determined that bars had violated social distancing and safety guidelines. The closure silenced a large portion of Nevada’s lucrative restricted gaming business – those locations with 15 or fewer slot machines. Grocery stores, convenience stores, and drug stores which also have restricted gaming slot machines were not affected. Timbers Tavern in Las Vegas with bar top slot machines/via Timbers Hospitality Group Nevada has 2,451 restricted gaming locations, operating some 17,600 slot machines. Clark County alone accounts for more than 1,600 of the restricted gaming businesses with more than 13,200 slot machines, according to the Gaming Control Board. Southern Nevada county and municipal leaders recently provided some relief, allowing tavern operators to move the games out of the bars and place them in slot machine cabinets, similar to casino slot. Hence, the bar top holes. The Gaming Control Board, already dealing with a plethora of coronavirus matters concerning the casino industry, asked tavern operators to just provide a layout showing where the games would be located. It worked, but it wasn’t a perfect solution. The costs associated with transferring the slots and management systems off the bar and into a cabinet were prohibitive for many operators, most of whom had already suffered significant revenue losses during the state’s initial 78-day gaming industry shutdown to slow the pandemic. Location square footage also was a factor; most taverns don’t have enough space for multiple stand-up slot machines. That, coupled with social distancing guidelines set out by gaming regulators, meant that only a handful of games could be converted. For example, Roger Sachs, who operates three “Steiner’s – A Nevada Style Pub” in Las Vegas, has six stand-up slots in two of his locations and seven in the other – not an ideal scenario for a business that lost two-and-a-half months of gaming revenues and was open for a little more than a month before the second shutdown. Adding to the tavern operators’ pain was a directive from the state’s Attorney General that mandated that gaming locations can only serve alcoholic beverages to dining customers at booths and tables inside. Slot customers can, hypothetically, have a beer along with a meal at their slot machine, which Sachs termed a “desktop” slot cabinet, but there isn’t enough space for much more than a chicken wing. Sachs called the directive “another nuisance to make us jump through hoops. (It’s) Attorney General overreach in determining how we operate.” Less than a week after the ordered shut down, a group of Las Vegas tavern and bar owners sued the governor to block the directive, saying they had been singled out. Las Vegas attorney Dennis Kennedy, who filed the lawsuit, said he represents the owners of some 62 taverns, none of which have been cited for any violations of the state’s COVID-19 health and safety guidelines. “The disparate treatment of bars and taverns is unreasonable because there is no rational basis for treating bars and taverns differently than other, similarly situated, non-essential businesses,” attorneys wrote in the lawsuit. A hearing, postponed from last week, is scheduled for Thursday morning in Clark County. The judge wanted to know if the governor’s most recent actions and statements following the bar top shutdowns had changed any circumstances. Bar top slot machines, such as this game from IGT, were closed in restricted locations in Nevada under the governor’s directive Kennedy said no. “The slots are still closed.” Nevada’s largest tavern operator, Las Vegas-based Golden Entertainment, told analysts last week the company added stand-up slot machines to roughly one-fourth of its 60 locations in Southern Nevada. “The stand-up performance I would just say is very impactful,” said CEO Blake Sartini. “It’s at, or exceeds, what you were seeing at the bar top. For the foreseeable future, as long as our state is restricting commerce across the bar top, whether it’s food, beverage or gaming, we will continue to roll out these stand-up games in these locations.” Slot machine providers International Game Technology, Scientific Games, and Aristocrat Technologies all unveiled upgraded bar top products at the 2019 Global Gaming Expo, so equipment sales have been stymied. Gaming operators are watching the COVID-19 impact on Nevada’s restricted gaming model. Eight other states have legal video gaming terminals or slot machines routes in restaurants, bars, taverns, convenience stores and other locations that sell alcohol – Illinois, except for the Chicago area; Louisiana; Montana; Oregon; South Dakota; West Virginia; Pennsylvania; and Georgia, which operates under a non-traditional semi-cashless approach. Missouri, Mississippi, and Indiana have been exploring legalization. Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at firstname.lastname@example.org. Follow @howardstutz on Twitter.