As comprehensive as that is, that I
thought was a mistake then before we even knew what
the total budget was going to be, and it seems to me
to be -- my concern seems to be validated now because
we're proposing a lot of stuff and almost no provision
of which is going to be done for us at $600,000.
I understand there's a possibility of
Congress giving us additional money. Being able to
implement what we have suggested is absolutely
dependent upon that. But again, I think it's a
proposal that will help answer some questions for
which there is no information -- there's very little
information to this point. I think it would be very
useful and I'm pleased to have my name attached to it.
CHAIRPERSON JAMES: Thank you.
COMMISSIONER McCARTHY: May I just comment
briefly on two points? One, regarding the bankruptcy
study. What I'd like to recommend at this point is
that we allow Drs. Reuter and Kelly to meet with
whoever Treasury has assigned this responsibility and
find out what they really are going to cover, and see
if there's a way we can make sure the ground is
covered; that they're going to cover it in a way that
relates to our overall objectives. That's fine, but
let's see if we can do that coordination.
I think your main objective, John, was to
avoid duplication. I think we all agree to that, and
with that one bit of flexibility, if we can approach
it in that manner I would appreciate it very much.
COMMISSIONER WILHELM: I think you covered
that; certainly.
COMMISSIONER McCARTHY: The other point
raised, Madam Chair and members of the Commission, by
Dr. Dobson regarding additional money is that I think
we should see how the members of the Commission feel
about this proposal; then I would like to get back to
a discussion of whether we do anything with Congress,
or how we go about doing that.
But I'd like to find out how much support
there is on the full Commission to do that, after we
have a discussion on the substantive issues before us.
So if we could defer my comments on that for now.
CHAIRPERSON JAMES: Certainly.
Commissioner Loescher.
COMMISSIONER LOESCHER: Yes, Madam
Chairman, I would be appreciative of the committee and
our advisors and staff if they could explain to me an
additional point which would have a bearing on my
thinking about this research and report writing, data
gathering exercise.
I'd like to know about the ACIR -- their
relationship, their proposal -- and how all that fits
in with this approach.
COMMISSIONER McCARTHY: I think we're at
the point now, if I may respond, Mr. Loescher, where
we can make that decision. Because the next step --
if the Commission approves what is before them now the
next step is to begin project design, try to more
precisely formulate budget requirements for each of
these areas that are a part of this proposal before
you, and ACIR would fit into that picture, as well as
other research organizations, or individual
researchers that we would attempt to identify to see
how this comes together at this point.
CHAIRPERSON JAMES: I would also like to
add at that point, that later in our deliberations
when we talked about the workplan, I wanted to make
the suggestion that it was exceedingly difficult to
move forward in any direction with that, in any way
with that, because we do need to bring to closure and
have a vote on the Research Subcommittee's report.
And you know, it's almost like which comes
first, the chicken or the egg, and I do believe that
the Commission needs to make some commitments about
that and make some determinations about where we go,
and that will tremendously impact the rest of the work
for this Commission.
So I concur with what you're saying.
COMMISSIONER LOESCHER: Madam Chairman?
CHAIRPERSON JAMES: Commissioner Loescher.
COMMISSIONER LOESCHER: If I could just
follow up on that -- I give deference. Mr. Bible, do
you want to --
COMMISSIONER BIBLE: I assumed, Madam
Chairman, that procedurally the next step is the
Research Subcommittee was going to explore the cost
option of these various alternatives and put a price
tag to the various elements of data gathering, then
would bring it back to the Commission --
CHAIRPERSON JAMES: Right.
COMMISSIONER BIBLE: -- and then we do
what Dr. Dobson has suggested, and maybe take a look
at those items that we assign higher priority and
those that have a lesser priority would kind of fall
by the board.
CHAIRPERSON JAMES: That's correct.
COMMISSIONER BIBLE: So you know, that's
the process that's --
COMMISSIONER McCARTHY: Mr. Bible is
correct and that's what I set out in the October 8th
memo that was sent on behalf of the subcommittee to
all members of the Commission.
CHAIRPERSON JAMES: At this point I'd like
to open it up for discussion on the presentation that
has just been made. Are there questions of the
Research Subcommittee, concerns, additions, deletions?
Are there any gaps here?
I'd like to add my voice to those who have
already said what a fantastic job I think they have
done. It has been an absolute pleasure to work with
the subcommittee.
They have put in -- for the benefit of
those who have not had the opportunity to watch this
up close as I have -- the amount of hours and time
that have been put in to get us to this point are
extraordinary, and I think that that subcommittee had
a variety of views and opinions represented there and
I think it speaks well of the chair and the
subcommittee itself to get us to the point where we
have a unanimous recommendation from the subcommittee
before the full committee today for a research agenda.
And I just want to add my voice of thanks to the rest
of those who have expressed that.
But it is appropriate at this time, after
hopefully you've had a chance to review this, for any
additional questions, concerns, comments. This is the
time.
COMMISSIONER LOESCHER: Madam Chairman.
CHAIRPERSON JAMES: Commissioner Loescher.
COMMISSIONER LOESCHER: I have a number of
comments about the committee's report and the
presentation. I was looking at page 1 in the
introduction, the last sentence. And maybe it's just
a matter of how you use words or what you're trying to
emphasize, but the sentence reads, "Casino gaming,
both commercial and tribal, gets more attention than
other forms of gambling, but no legal form is
neglected".
You know, and I have a hard time with that
idea. We're charged to look at all gambling in
America and we have to have a strategy to write a
report, to develop data and supplement that
information where we're short, to cover State
lotteries, cardroom gambling, charitable gaming, pari-
mutuel gambling, electronic gambling, riverboats and
casinos.
And I'm troubled that the committee and
the staff is so focused on casino gambling. I want to
look at it all, and I want to have equal emphasis on
it all. But certainly from the outset in the
introduction, it doesn't appear that that emphasis of
getting to all of it is going to be accomplished.
And I would like to ask the committee if
you have any comments about my perception?
CHAIRPERSON JAMES: Commissioner Wilhelm.
COMMISSIONER WILHELM: In the
deliberations of the subcommittee, Leo and Jim are
aware that I have expressed a similar concern. I
believe that this Commission wouldn't exist but for
the spread of a variety of forms of gambling that has
accelerated so much in recent years. Some of that is
casino gambling but there's a great deal of other
forms of gambling proliferating.
As a native of the State of Virginia who
hasn't lived here in some decades, I'm stunned when I
drive down the road on the way to the hotel this
morning and hear the rock solid, conservative State of
Virginia bombarding me every 12 seconds on the radio
with entreaties to buy new and different forms of
lottery. It's absolutely astounding. It's not the
Virginia I grew up in, but then again, the world
changes.
So I agree with Bob's concern. I am,
however, heartened by the fact that as I read the
report's recommendations on the items that again, I
believe are the most important here -- the prevalence
study, the database, the targeting studies and the
case studies -- I believe that the report fairly
reflects the intention of the subcommittee to
encompass in those studies, not just casino gambling
but all forms of gambling. And I think that's pretty
clear in the text of those sections.
CHAIRPERSON JAMES: Commissioner Dobson.
COMMISSIONER DOBSON: It's obvious that
the statute does require us to look at various forms
of gambling and I think we should. But approximately
50 percent of all the revenues that come in from
gambling are invested, if you will, in casinos. So I
think this statement here merely reflects the
preponderance of the gambling industry that is related
to casino gambling.
COMMISSIONER McCARTHY: I would add, Madam
Chair, that this really suggests -- we looked at the
volume of dollars from each legal form of gambling and
what the projected growth was suggested for those
different forms of gambling, and that is what we
attempted to see reflected in this.
If you'll note, in the database on
communities, for instance, we are very specifically
going to pick out samples of communities where there
is lottery-only, casino-only, and various combinations
including other forms of gambling as a basis for
comparison and how we get a handle on the
ramifications that -- the consequences that flow from
each form of gambling.
We're not interested proportionately, in
gambling that has very limited usage. How much
attention we will pay to gambling where they represent
one-half of one percent of the volume in America --
you know, the volume should suggest how much attention
they get. If there's a projection that that one-half
of one percent is going to grow into 10 or 15 percent
then they will be included in the research that we
have. But that's the reasoning behind that.
CHAIRPERSON JAMES: Commissioner Dobson.
COMMISSIONER DOBSON: Madam Chairman, this
comment I hope people will kind of hold over to our
discussion of our site visits and where we go, but
Commissioner Wilhelm has pointed out in our meetings
that perhaps the most predatory form of gambling are
the video machine, the poker machines, and things like
that that are put in truck stops and other places;
that are not major gambling centers that don't for the
most part, bring in tourists but suck money out of a
local community without giving a whole lot back.
And I would hope that in our site visits
that there would be some effort to do something other
than go to the big, enormous Las Vegas, Atlantic City-
type centers in order to examine these other aspects
of gambling.
COMMISSIONER LANNI: Madam Chair?
CHAIRPERSON JAMES: Commissioner Lanni.
COMMISSIONER LANNI: I would just hope
that Commissioner Dobson would wait until he's reached
a conclusion of who's sucking what money from what
community without giving anything back, until the
research maybe gives a little more clear view of that.
COMMISSIONER McCARTHY: He's quoting Mr.
Wilhelm in whom we've always found to be a reliable
source of information.
(Laughter.)
COMMISSIONER WILHELM: I'm going to write
that down and save that for later.
CHAIRPERSON JAMES: Commissioner Leone.
COMMISSIONER LEONE: I've been struggling
for the last several weeks with the fact that I have
some, what I think are quite wonderful ideas for the
research agenda, but they are impractical because of
the money involved.
I think Congress in this case, given the
significance of the issue and the paucity of
information about a variety of topics, particularly on
the economic side, has short-changed the American
public by not providing us with the funds we need to
do the research that ought to occur here.
Now having made my oratory statement I
actually have a couple of specific ideas that I
thought about as things that are not expensive.
They're difficult because the minute you move away
from large-scale data gathering and research you enter
into areas that to some extent, are more subjective,
and I think therefore, the product will be subject to
a different kind of interpretation or scrutiny.
But I want to make three suggestions that
I think are not expensive and that might be useful.
The first is, you know, the Act is written and a lot
of the discussion about the public sector
decisionmaking that has gone on and continues to go
on, I think the Act overlooks an important factor in
that.
I'm not naive. I know there's corruption;
I know fundraising and other terrible necessities for
people in public life can't help affecting the
decisionmaking. But I've tried to think a lot about
the changes in the culture and in our politics that
have made it politic for states like Virginia and
others to be so active in promoting a culture of
gambling through lotteries and other things, and to
support the introduction of gambling as a way -- to
put it neutrally -- to raise more revenue for the
government; a way that is often seen as painless.
And I think that we might do an
interesting survey -- I have some ideas about how this
might be done but I leave it to others -- of public
officials, past and present. And of the factors that
have gone into decisionmaking and of their attitudes
towards what they've gotten and what has been produced
over time.
With a protection to some extent, of -- I
mean, these conversations would be public, these
results would be made public, but I don't think we
necessarily have to attach names to them. It's an
idea I got when we talked earlier about developing
information on pathological gambling but then not
saying, "and Joe Smith is the person we're talking
about where this particular happened".
I think it's one of the more fascinating -
- frankly, I'll indicate a bias in this -- troubling
developments in the American public's fear of the last
30 years is in the pursuit of revenues; people who are
supposed to be thinking in a very complicated mix of
public values have generally moved in this direction.
I don't know what factors have gone into
it, but I think it would be interesting to have a
survey of that type, or even to arrange a hearing or
set of hearings -- which obviously we'd do under
confidentiality -- where we explored this issue with
some people. Obviously, in this case, I think past
elected officials and others would be better than
present, and what they think the consequences are.
I think it's a big question because one of
the things about gambling that is a fact is that we
used to talk -- when the last Commission met, the
great interest was in illegal gambling.
This Commission is meeting because
gambling is legal in so many places, and whatever else
has gone into it, this is -- you know, a man from Mars
who met one of us who was upset about gambling might
say, well gee, you ought to do what we do. You ought
to do what we do -- you ought to elect your leaders
and then they do what you want them to do.
(Laughter.)
Well, I feel that's a -- a man from Mars
might say that about a great many things that are
produced by our public sector. But I think on this
one, it's just an idea I leave to serious researchers
to explore it with other people. Maybe it's so flawed
and the product would be so flawed.
I have two other ideas that --
COMMISSIONER McCARTHY: Before you leave
that --
COMMISSIONER LEONE: I just don't think we
should not touch this question.
COMMISSIONER McCARTHY: No, I think Dr.
Reuter wants to make a comment on your point.
DR. REUTER: This is very consistent with
a comment that Commissioner Wilhelm made.
COMMISSIONER McCARTHY: Now you're in
trouble.
DR. REUTER: In some ways it goes back to
the comments that have been already made. You know,
why is the Commission here? Something has changed
fundamentally, and if the research is only focused on
trees then forests don't get described and this is our
mission.
It adds to our knowledge of what has
driven this -- whether it's appropriate as research or
for a hearing -- I think it is a decent question. It
would not be I think, a major expenditure, and if the
Commission thought that that was really important I do
think this is a reasonably standard academic kind of
activity in which you could find the right public
policy academic and a good research assistant and get
it done if the Commission wants to do that.
I mean, I don't think that answers an
important question, but that's just my view.
COMMISSIONER LEONE: I have two other
thoughts that I think are even cheaper.
DR. REUTER: It could be done by a small
foundation.
COMMISSIONER LEONE: That's right. We
have so little time and the resource constraint, but
there are two big areas of inquiry that I think the
most we can do is collect information about other
studies on: one is the economic impact; the other is
the regulatory regimes that are in place here, and
maybe even in other countries.
And I also would like to add, the
regulatory regimes -- which I hope is not too
threatening a word -- which we use in other areas of
risk in the futures markets or rise above it.
It seems to me if I were approaching these
independent of the Commission and I didn't have a lot
of money and I didn't have a lot of time, I would put
together panels -- of economists in the one case and
probably law school people and regulators -- to talk
about what's best in this.
What do we know about what works and what
doesn't work and what has adverse effects even though
it looks real on the surface, on what doesn't? And in
the case of the economists, what do we really know
about how to approach this?
Because among other things I think we want
to leave as far as possible, a rather precise research
agenda for universities, foundations, the government,
others who might want to follow up where we can't
answer a question.
And I think the economic impact is one of
those and I have found that economists are true to at
least one principle -- they're market-driven. If
there's a lot of research money around something tends
to get researched; if not, it tends not to get
researched.
We are not going to provoke a lot of
research on the economic impact of various kinds of
gambling because I think it differs depending on what
it is with the amount of money we might get, even if
we get an additional appropriation. But we might well
provoke other people to move in that direction by
developing an agenda, and to do that I think we need
some expert, outside assistance.
And so I think we might think about a
panel, whether its -- if that's legally possible or
otherwise possible. After listening to the discussion
at the last meeting I'm afraid to meet with anybody
about this. But I think maybe there's a structure on
which we can proceed.
So those are my thoughts. I also add --
and others have said it but it's true -- the group
that has done the most good work for us so far is this
Research Committee. So it deserves a lot of credit
and people put in a lot of time. As somebody who was
invited to come to the meetings and couldn't, I admire
your willingness to get together at various airport
coffeeshops around the country.
COMMISSIONER McCARTHY: Thank you.
CHAIRPERSON JAMES: Other -- yes, John.
COMMISSIONER WILHELM: On Commissioner
Leone's last point I kind of added to my areas of
expertise the shape of windowless rooms in the Denver
area, in deference to Jim's schedule which has been
educational.
I wanted to differ slightly perhaps,
emphasis at least, with Leo's comment about the fact
that resource and time realities being what they are,
we'll probably end up, you know, looking at those
forms of gambling that are sort of big money, and if
one of them is one-half a percent, maybe not.
I have a slight difference, at least in
emphasis, on that point, and it has to do with the
difference between the snapshot in time and
trajectory. Because I think if you look at the
realities of the expansion of legal forms of gambling,
that they are a great deal more complicated than most
people appear to think. And they're not necessarily
related to the proportion of dollars being legally
gambled at a particular snapshot of time.
And as an example, if you look at
California. Californians, like all other Americans,
have apparently been gambling heavily -- both
illegally and legally -- for a long time and I presume
will continue to do so. It appears to be part of the
human condition.
But you know, for a while there was -- for
a long while -- there was a lot of pari-mutuel horse
racing activity in California and then the State in
its wisdom decided to get into the lottery sort of as
the lottery used to be thought of. You know, once a
week you went and bought a ticket, or something like
that.
And although there have been cardrooms in
California for a long time, cardrooms have certainly
sort of come into a newer and bigger generation. And
then the lottery in California, as in some other
places, has decided that it will be a lot more than,
you know, a ticket a week or even eight tickets a day,
and they've got these machines in bars and so on and
so forth.
And then you've got a dramatic expansion
in tribal casino gambling as well as bingos -- you
know, going beyond churches and synagogues and into
Indian reservations. So you've got all this stuff,
and I think the question of, sort of what drives what
and what are the things that work together to fuel the
expansion of legalized gambling, is a very complicated
question and I think it's a highly dynamic one.
If you look at New England, an area where
I lived for a long time and know reasonably well, they
did the same thing to me they did in Virginia. You
know, I used to think -- the State motto in
Connecticut is 'The Land of Steady Habits'. But you
can't just look at Connecticut; you've got to look at
Massachusetts next to it, and Massachusetts has got an
extraordinarily aggressive form of lottery.
Somebody told me -- and I don't know if
this is factual -- that the people of Massachusetts
spend more money on the lottery per capita than
anybody else. So I think that in looking at the
question of, what after all, brought this Commission
about, what is it that is fueling the expansion of
legal gambling, I think we've got to first of all, not
lose sight of the benefits.
As a person who represents tens of
thousands of workers who work in that industry, the
benefits are significant and cannot be ignored. I
think that Commissioner Leone's idea for a survey of
public officials is a fascinating one, but I think in
the end, we will fail if we lose sight of the highly
dynamic character of what is driving the expansion of
gambling.
As opposed to saying, well you know, a
bunch of people are proposing casinos -- either
because they want to make a lot of money or because
they want to have a lot of tax revenue -- that's
really so simple as to be really, an irrelevant
approach to it, and I wasn't accusing anybody on the
Commission of taking that approach.
But I think we've got to be very, very
mindful, not just of dollar volume and snapshots in
time, but of trajectory and of dynamics.
COMMISSIONER McCARTHY: Madam Chair, Mr.
Loescher --
CHAIRPERSON JAMES: Mr. Loescher.
COMMISSIONER LOESCHER: Madam Chair, I
don't know how -- you asked, you know, for questions
of the presenters, but I have some comments and I
don't know if you're willing to take them.
CHAIRPERSON JAMES: We're open to take
anything that's related to this subject.
COMMISSIONER LOESCHER: Madam Chairman,
let me just walk through a number of my observations
of reading through this paperwork in the full packet,
which all the pieces sort of fit together when we come
down to writing our report, and data gathering, and
the research, and the hearings, and the budget, and
all that. And I'd just like to sort of link them
together in my thoughts.
One is that this business of the ACIR and
the relationship and the dollars and whatnot, I have
troubled feeling over the ACIR, and I know my friend,
Senator Stevens tried to resurrect the ACIR and I'm
not sure it's going to work coming through the Gaming
Commission, and I'd be willing to go chat with him
about it.
But I see that we're trying to defer the
ACIR in our process, yet it's a statuary thing they're
supposed to do with them. I see some reluctance to do
business with them. And I read their proposal and
it's a proposal and I appreciate the proposal, but I
have trouble with the budget, the overhead issues, and
the fact that I don't get to see who the
subcontractors are -- the employees.
It's important to me to know who's doing
work for this Commission. And so I perceive that it's
not a straightforward relationship, and I urge the
commissioners to entertain the discussion about the
ACIR.
If we're going to bypass them or subvert
them or set them aside, let's do it straightforwardly
and advise the Congress and the powers that be, that
we want to do that, and then the Commission can find
another way to take on the work that's in the Charter
of the statute through which we're supposed to get
assistance with these people.
DR. KELLY: Madam Chair?
CHAIRPERSON JAMES: Yes.
DR. KELLY: Commissioner Loescher, if I
could just call your attention to where this is
addressed in the document, perhaps that would help
with this concern. It's on page 9.
COMMISSIONER LOESCHER: I don't know about
that. I'm just trying to reflect what I think.
DR. KELLY: Okay.
COMMISSIONER LOESCHER: The other thing
is, the business of the emphasis of the apparent --
you guys call it research; I call preparing a report.
That's our statutory mandate. And in our Charter
which is in our binder, it lays out what the statute
says and what we're supposed to be doing and whatnot.
And it doesn't de-emphasize one thing over
the other. It says, when we get done at the end of
the day two year's hence, we're supposed to have a
report that covers all these subjects.
And so I remind the Commission that maybe
we ought to ask that our committee and our executive
director and our research people take another look at
what we're doing, so that the product that this
Commission comes out with covers what the Congress
wanted, on behalf of the public.
And I believe that all forms of gaming
should be reflected in our report, not just casino
gaming.
The other is, I realize that we have
limited dollars and whatnot, and I view the survey as
kind of a dubious exercise. And even the presenters
in their writing, you know, are kind of curious or
concerned about what might come out of it and how it
will be viewed.
There are different kinds of gaming by
State and geographic area, and I'm not sure that by
survey, you know, a standardized survey, we're going
to cover the differences.
The other is the issues of opinion versus
fact. I'm wondering if the survey is going to get us
closer to the fact. Are we going to get a lot of
opinion, and then what kind of opinion are we going to
be getting?
The other thing about surveys is, what are
the questions? I think it's very important that this
Commission, if we get involved in the survey, that we
look at the questions very carefully and frame them
very carefully, because otherwise, I believe a survey
is no use.
I'm opposed to this survey -- I just don't
think it's the right exercise to get information and
I'm not sure that it's going to give us the balance
for our bucks that we have in limited resource here.
The other thing is, I spoke to Dr. Kelly
and I haven't had a chance to speak to Mr. Reuter --
and I'd like to -- but I kind of start differently
than where the committee is going, and maybe not so
differently than what the intent of what the executive
director and the staff might be.
But I think, you know, we start with what
is known, and I would like to suggest that we use part
of that $1.7 million that we have budgeted for staff,
to bring on staff who can look both externally --
meaning in the public resources -- and internally
within the Federal, state, and local government
resources, to define, what is gambling America.
Get the information about what is known,
and we put an emphasis over the next, let's say, six
to ten months to really get that database gathered,
and then you know, first rough draft, put that down as
a part of our initial report. If we could take that
step then I see the other tools that the Commission
has in statute can come into play.
I'm just saying, either simultaneously or
sequentially, we can add the research, that we can use
the hearing process that's allowed to us in the
statute, and then we can invite people to supplement
the database voluntarily, which we have the ability to
do. And then our site visits to fill the gaps of what
we know.
What I'm trying to say to the committee is
that, maybe I'm not reading your report correctly.
Maybe the emphasis is not there; maybe the definition
of these steps that I'm talking about are not
amplified in your paper and approach. But I really
believe that this is the way to go about preparing the
report -- not the research; the report -- which is our
target.
CHAIRPERSON JAMES: Could I ask just to
stop there for a minute and see if either Dr. Reuter
or Dr. Kelly would like to respond to that, and then
we'll take up the next point you have.
DR. KELLY: If I could, Madam Chair, a
couple of points come to mind and then I'm sure Dr.
Reuter might want to join me here.
There are two of the issues that
Commissioner Loescher just raised that I did want to
bring to your attention. And we've discussed this and
I do understand the validity of the concerns that are
being raised.
However, on the issue of the ACIR role,
I can assure you that neither the Chair,
nor the subcommittee, nor we, have any desire to
circumvent the legislation. The legislation does say
that the ACIR will play a role in one of the portions
of the research to be performed.
If you look on page 9 of the research
agenda, under "Other Topics", it reads: "The
Commission must undertake certain descriptive tasks"
-- I won't elaborate all of that. And then the
footnote states: "Some or all of this area of
research may be performed through contracting with the
ACIR.
So I believe that was the subcommittee's
effort to, in fact, recognize the role that the ACIR
will play in the final product. However, if you read
the document, what the document is saying is that we
will first focus on some of these other areas of
concern and then come back to the question of
identifying precisely what the role of the ACIR would
be.
So I think it's not that the role of the
ACIR has been taken off the table, it's just that it's
been put at a second level to come back to once we
have a clearer picture of what, in fact, is known.
CHAIRPERSON JAMES: Commissioner Bible.
COMMISSIONER BIBLE: As it relates to the
ACIR, as I read the statute there's a mandate that
they be involved in the one activity and that it's
permissive beyond that. It's that they may provide
assistance in the other activities that are enumerated
in the statute, and I believe you captured that in
your subcommittee document.
DR. REUTER: Could I take on --
CHAIRPERSON JAMES: Dr. Reuter.
DR. REUTER: -- Commissioner Loescher's
two broader comments: one about whether it's
appropriate to have a research agenda that doesn't
sort of start with a grounding in description of what
is. And the second one is, what do we get from a
survey?
And first of all, I would suggest that
there is a timing issue which is, these research
activities are going to be difficult to complete even
if we start now, and to defer them for six to ten
months would basically mean that we would not be able
to undertake them.
I see them as research in support of the
report writing activity itself, and the subcommittee
certainly was choosing research activities that were
supportive of the report writing that the Commission
would have to do. And so, all of the interesting
topics like Commissioner Leone's sort of were not
included because they weren't really supporting the
report writing activity.
There are undoubtedly, some descriptive
activities of the kind that you have mentioned,
Commissioner, and we did not, in writing this
document, dwell on them, simply because they are
descriptive. They do need to be undertaken -- one
seen really as being part of a research agenda which
has to be -- that which some major decisions have to
be made very early.
Secondly, with respect to the survey, the
survey -- it's a survey of behavior, not of attitudes.
It's not asking about opinions. An effort to
acquiring -- what is now a very conventional way --
information about individual behaviors. And while
this hasn't been done for gambling in recent years,
it's done for a whole variety of other things.
And survey data, you know, have their
limitations, but they certainly -- there's enough good
public policy that has rested on survey data about
behavior, not merely attitudes; that this seems to be,
defensible.
And going back to the 1976 survey, the
Survey Research Center was able to replicate
surprisingly closely, the total expenditures on legal
gambling from answers provided in the survey; which is
a very important source of validation of the survey
data.
It certainly has its limits but there
simply is no alternative at this stage for obtaining
information about gambling behavior. And gambling
behavior, you know, isn't the heart of this. Unless
we know how people participate in these activities
it's very hard to talk about the effect of changing
policy and access.
COMMISSIONER LOESCHER: Madam Chairman.
CHAIRPERSON JAMES: Commissioner Loescher.
COMMISSIONER LOESCHER: Just a couple of
things. We approved a contract with the National
Research Council that deals with this issue --
behavior. Is that not so?
DR. REUTER: It deals with only one aspect
of that behavior -- a very important one -- but it
deals with problem and pathological gambling.
COMMISSIONER LOESCHER: Okay. So anyway,
just to continue, and maybe some of my points will
help what you're talking about. The issue of
contracting and whatnot, I believe there's a lot of
data -- I mean, the state governments, the tribal
governments are very sophisticated now in their
reporting requirements against authorized gaming in
whatever state there is. A lot of data on the
economics and the reporting and the types and whatnot.
And I really, you know, I really think we
ought to take advantage of that. The thing that
troubles me, that I'm concerned about, is that there's
no scoping for the hard work of preparing the factual
basis of what gaming in America is. There's no
scoping at this moment in our workplan.
And there is one aspect that bothers me
about that; is that the issue of what do we do with
internal staff of the Commission, or we do contractor
work in certain areas. I'm not sure -- and it's a
legal question, legal/technical question -- whether
we're going to be able to secure information from the
various agencies of the government if we do it through
a contractor.
I think maybe that the internal staff of
the Commission is going to have to be the persons that
go to the FBI and Treasury and Justice and tribal
governments and the regulatory commissions and
whatnot, to get this information that may be
confidential and proprietary.
And to me, it's a question. I think
maybe, depending on how you determine it, the best
approach and the best way to establish our
relationships with these agencies, it may be that our
staff is to be beefed up in order to get this
information.
And I just offer that as a thought,
because I don't know, if a consultant comes to a
Native American reservation whether they're going to
give them the information, but I believe that if a
representative of the Commission comes, maybe we could
get some cooperation on that.
And we can just use that by example but I
think it's a concern, and I really would like to see
the hard data gathering for the basis of the report
get some emphasis here.
The other point that I'd like to make is
dealing with the budget. We have $1.7 million -- the
way it looks on this budget -- for staff, and you've
got a tiny staff and I looked at the resumes and I
think they're great. You have a good start, but
there's hardly any budget commitment to the staff.
And I'd like to know how you're going to
use the rest of the $1.7 million, and give me a
workplan -- what's going to happen and who are the
people who are going to do it. That's not reflected
here as we build the structure of our report and data
gathering and research and hearings that we've got to
do.
And then I agree with the commissioner
that we already spent -- what is it -- 550,000 out of
the 1.2 million, for --
COMMISSIONER DOBSON: It's 620.
COMMISSIONER LOESCHER: So 620,000 --
about half of that out of the research budget. So
again, there is a budgetary question of how you employ
these dollars to get the result that's in our Charter,
our work Charter. And so I don't see any information
as to how we're going to do that.
Where is the status of this request to
Congress? Did we actually file that, and what is
going to happen?
COMMISSIONER McCARTHY: Could I address
that, Madam --
CHAIRPERSON JAMES: You certainly may.
COMMISSIONER LOESCHER: Okay, let me
finish my last couple of things here. The issue of
Congress. It's apparent to me that we may have to go
back and ask Congress a number of questions and see if
they can give us some help. I know some people say,
ah we don't want an extension of time, but maybe
there's a need for an extension of time.
Some people say we need another million
dollars. I don't know, because I don't have a
complete workplan that says we need another million
dollars but maybe we do; I don't know. FACA; maybe we
can clarify that. Electronic gaming and bankruptcy;
maybe we can eliminate that from our charge with the
Congress.
And then this ACIR question might be a
question that we could clarify with the Congress. But
I don't have any problem going to the Congress and
asking for some remedial, clarifying language for the
statute.
And then lastly, at the last Commission
meeting I had distributed to the Commission and to the
staff, a paper from the National Indian Gaming
Association, NIGA. I had requested of NIGA as a
courtesy, and the question was this: if you were to
respond to the Study Commission's Charter under the
statute, how would you go about doing that?
And as a gesture of good will they
responded to me in writing and I distributed their
thought to you. And I certainly would like to request
that the committee and the executive director and the
advisors that we have here, to take that gesture of
good will, of their cooperation, and their thought
pattern of how to approach a response for the Native
American component of our report, and see if we
couldn't accomplish what we're trying to accomplish
with their good will and to match what you all are
trying to do.
And I would like to elevate that thought
to the committee and to the executive director. And
basically, Madam Chairman, that's all I have to say
about my perceptions of this process.
CHAIRPERSON JAMES: Dr. Kelly.
DR. KELLY: Yes, Madam Chair, I would like
to offer some thoughts in response, and again, we've
been discussing this over the last few hours, if not
few days, and these are some complex issues.
But let me begin by recognizing I think,
one of the things that you're saying, Commission
Loescher, is that NIGA and you are willing and eager
to help with the work of the Commission and the work
of the research component of the Commission. And I
know I speak for the Commission when I say we're very
appreciative of that, and if it seems that we haven't
been, that might be that there's been some
miscommunications.
But as we discussed earlier, I'd be glad
to work one-on-one with whoever you might designate or
with yourself, in order to make sure that we
communicate clearly on that point. But we welcome
your input and your data.
And towards that end I would call your
attention to again, something that's in the Research
agenda; it's on page 7, in the middle of that -- under
this third section on the industry -- it's right in
the middle of the page.
And it's just a quick statement but it's
important because it signals the fact that we, the
subcommittee and we ourselves, have tried to be
sensitive to the research questions that were raised
in the NIGA document.
Now, if we missed something I do apologize
and we would be glad to work on that, but that
statement says: "Industry data will be helpful in
addressing issues raised by the NIGA concerning" --
and it goes on to detail what the issues are. But the
point of the matter is that we tried to incorporate
those specific research questions that we culled from
the NIGA document, and will continue to do so.
A second point I wanted to make, if you
would look on page 5 of the document -- page 5 of the
Research Agenda. At the top of that page I think it's
the Research Subcommittee trying to say, I think, what
you're saying -- only with different terminology.
It reads like this: "Though the vast
majority of these data are available from official
agencies, the creation of this database is a major
research activity because so much local data is not
available from a central source".
For example, crime report, arrest data,
and theory available through jurisdictions from the
FBI and others -- it talks about the difficulties of
getting this but that we will get this data.
So I think that perhaps we're saying
something of the same thing with different
terminology, and I would like to suggest that maybe
one way to address your concern would be to think in
terms of the timeline that is outlined just in summary
fashion on page 12. And maybe what you're saying is,
let's make sure before we jump into secondary
research, that we've had time to review what is known.
I'm sure that is the intent already, of
the subcommittee, but maybe we need to highlight that
a little more in order to address your concern. But
I'm feeling like there's not that much difference
between what you're recommending and what the intent
is of this document.
COMMISSIONER LANNI: Madam Chair?
CHAIRPERSON JAMES: Commissioner Lanni.
COMMISSIONER LANNI: I'd like to move that
we accept the proposed Research Agenda as submitted by
Chairman of the subcommittee, Mr. McCarthy.
CHAIRPERSON JAMES: Is there a second?
COMMISSIONER McCARTHY: Second.
CHAIRPERSON JAMES: So moved and seconded.
Any discussion?
COMMISSIONER McCARTHY: May I make this
closing argument, because I want Mr. Loescher's
support. Number 1, we did move early on the National
Academy of Science's Synthesis of Existing Literature
and Pathological Gambling. That was one of the two
areas that was in the language of the enabling
statute. It was one subject, as Dr. Reuter pointed
out -- it was easier at the time to handle, in my
point of view.
Connected with this, there is no exclusion
of ACIR. I'm not sure where that came from. There
are undoubtedly -- there are several members of the
Commission that were puzzled by the fact that ACIR
went out of existence and then was restored by being
linked to this Commission.
From my point of view, I've had a series
of exchanges with Mr. Griffiths, the executive
director. He's given me intelligent comments in how
he would undertake analyses of certain issues. But
the scope of the research that should be undertaken by
this Commission is not limited to the research that
was identified in the enabling statute.
What's critical here is that we have a
responsibility, looking at the totality of gambling in
America, to try to define what the research should be.
And the four corners of that research aren't limited
to what Congress listed, specifically. In my view, we
now have before us, at least an outline. The next
step is project design and budget estimating -- which
you've mentioned a couple of times, quite
appropriately.
Of course project design and budget
estimation has to be brought back to the Commission.
This is what I said in our October 8th memo to all
commissioners; this is what Mr. Bible referred to
about half-an-hour ago that I reinforced; that that's
the plan.
You're quite right. Knowing what the
project design is and knowing what the budget
estimates are for these -- the only one we can really
come close to estimating now is the National Survey.
That's why we're asking for permission to at least
take the preliminary steps of trying to develop
requests for RFPs; that we begin to undertake that.
We're going to have to do work in the next
30 to 60 days to come up with more refined estimates
of what the budget estimates would be of these other
things. That's information you deserve and every
other member of the Commission deserves, and that's
the next step coming out of the subcommittee on
Research, with the help of Drs. Reuter and Kelly.
I hope I've addressed that one
satisfactorily --
COMMISSIONER LOESCHER: Madam Chairman,
can you assure the chairman of the committee that he
has my vote subject to him at least acknowledging my
comments?
(Laughter.)
CHAIRPERSON JAMES: Having said that, I'll
--
COMMISSIONER McCARTHY: I have one more
thing today. I need the help -- and I'm joined by my
two colleagues on the subcommittee on Research --
Madam Chair, I need the help of every member of this
Commission in whatever we may attempt to do to seek
help from the members of Congress to try to get
additional funding.
I hope we can feel that we have that. I'm
thinking of the friendships and the appointing powers
and so on; we certainly should be able to get the
attention of people in the Senate and the House.
After we vote on this, if it has full Commission
support, there's only in effect, one week left in
which a conference committee is even considering --
it's the conference committee on Treasury, State,
Commerce, and related agencies.
I would, Madam Chair -- I know you've
already been paying a lot of attention to this -- I
would like to work with you and be able to call the
individual members of the Commission and ask their
help in contacting the appropriate members of the
Senate and the House to try to at least get their
attention to this and look at this.
We need to formulate a strategy as to how
we address the funding for this research that will be
undertaken.
COMMISSIONER WILHELM: Was that in
reference to the million that was referred to?
CHAIRPERSON JAMES: Yes.
COMMISSIONER McCARTHY: Well -- oh,
someone asked a question earlier -- thank you; I had
forgotten this. Senator Dan Coats of Indiana -- on
his own initiative -- I want to emphasize that; not at
the request of any member of this Commission -- on his
own initiative spoke apparently, to the leadership on
the Senate side dealing with this appropriation
measure in conference committee and asked that a
million dollars be put in. But he did that on his own
initiative.
Frankly, had I known that anybody was
going to make a suggestion, I would have talked to all
of you and said, let's ask for three million. But you
know, I don't know what flexibility there is in the
circumstances that now exist; I don't know what
support there is for the million -- not to mind three
million.
And I think frankly, when we get the
budget estimates refined on the research, we'll have
a much stronger position to be able to talk about any
additional number. I want to remind everybody that
what was given to our predecessor Commission 22 years
ago is far more in terms of purchasing power then
compared to purchasing power now; far more than what
was given to this Commission to do work trying to
assess the economic and social consequences of an
industry that has grown tenfold since our predecessor
Commission looked at this problem.
So this is a serious matter and I really
am hoping, Madam Chair, coordinating with you, that I,
on behalf of the subcommittee and working with the two
subcommittee members, can call upon any member of this
Commission to try to help in the strategy of this.
CHAIRPERSON JAMES: Let me thank
Commissioners. It would not be my choice to have to
ask you for feedback as quickly as we did for that,
but Commissioner McCarthy thought it was important
that that letter get up to Capitol Hill expeditiously,
and that it would probably carry more weight if it
were signed both by the Chair of this Commission and
by the Research Subcommittee. And so that letter did
go forward and we are following that very closely, and
appreciate your support in moving forward.
Commissioner Wilhelm.
COMMISSIONER WILHELM: As I indicated to
you, Kay, when we talked on the phone about this, I
was pleased to support this with the understanding
that if the million were obtained that it would go to
Research and I was compelled to do that out of the
discipline imposed by my Research Subcommittee
Chairman.
But I can't refrain from saying, Leo, that
you're one of the tiny band of people on this
Commission who could even make that pitch with a
straight face since nearly everybody here is always
talking about cutting government spending.
CHAIRPERSON JAMES: Well, there was no
lobbying that needed to be done in terms of how
important this issue is and how the resources are
needed to research it. And I think there was a pretty
strong consensus among commissioners to that end.
I think we have a Motion before us and it
has been seconded. I'd like to call for the question.
All in favor?
(Chorus of ayes.)
Any opposed?
(None.)
The Commission has accepted the
Subcommittee's Research Report, and just to restate
where I believe we are at this point, the subcommittee
will now go back as a result of the acceptance of your
report, and look at costing out pieces of it,
prioritizing, and coming back to some suggestions to
the full committee with how we should proceed from
here.
COMMISSIONER LOESCHER: I want to
emphasize one thing, Madam Chair. In dealing with the
National Survey, on page 2 we do recommend that the
staff begin immediately inquiry into the options for
the conduct of such a survey, as well as discussions
with other Federal agencies that might be willing to
provide funds.
Now, this Commission may not have another
meeting until January. You'll address that before we
leave here today. We may have some appropriate
information in a month and I may suggest to you that
we have a conference call involving the commissioners
so we can get back to them, instead of suggesting a
face-to-face Commission meeting with my colleague all
the way here from Alaska.
So if that's understood -- because we want
to get this thing going; we're running out of time
doing this research. With that understanding.
CHAIRPERSON JAMES: With that
understanding. Thank you. I appreciate your hard
work and your presentation to the Commission, today.
CHAIRPERSON JAMES: With that
understanding. Thank you. I appreciate your hard
work and your presentation to the Commission, today.
We, at our last meeting, had a
presentation from ACIR and asked if they would come
back at this meeting and give us an update on where
they are in their perspective workplans, and so at
this point I'd like to ask Mr. Griffiths if he would
come forward.
Welcome.
MR. GRIFFITHS: I'm glad I came in when I
did. I was expecting not to be on until about 1:30.
I guess I have to ask a question. You just voted on
a Research plan, so exactly what is it that you want
from me at this point? I assume everybody has read
our proposal. Can I assume that?
CHAIRPERSON JAMES: Yes, and we'd like at
this point perhaps, if you --
MR. GRIFFITHS: Be able to ask some
questions?
CHAIRPERSON JAMES: -- can walk us through
any of that and have commissioners have the
opportunity to ask any questions that they may have.
COMMISSIONER LOESCHER: May I suggest,
Madam Chair --
CHAIRPERSON JAMES: Absolutely.
COMMISSIONER LOESCHER: May I give a
thought that I have? The next step will be that Dr.
Reuter with Dr. Kelly, will be talking to you and to
others as they start to develop what you just heard us
talking about here -- the next phase: project design,
budget estimates. Now obviously, you've got something
tangible that they can look at.
But they don't from any other source on
other aspects of the work which are totally outside
the scope of the thing that you've been talking about,
so they need to be able to get some of those pieces in
place to integrate this thing together to see where
we're going. And frankly then, to be in a better
position to talk to members of Congress as well; see
how we get more funding.
CHAIRPERSON JAMES: If you have any
opening comments, and then we'll open it up for
discussion.
MR. GRIFFITHS: Well, what I'll do is,
I'll simply outline what we did without going through
it task by task, and then I would assume that if
anyone has questions on a specific task or approach,
that I'd be happy to answer those questions.
When we wrote the research prospectus we
were asked to do it in two parts. One part dealt with
task 7.A, which is Section 7 of the Act. Task A which
is where we would review and collect laws,
regulations, applicable to Federal, state, local
government, and Indian tribes, related to gambling.
That would also probably include
appropriate constitutional provisions as well as -- we
recommend anyway -- court decisions, because court
decisions have had a great bearing on what state and
local government officials have to do at times.
The second part then, was to take a look
at Section 4, and the tasks under Section 4 which are
associated with our Commission in the law. And I was
also asked to include task F, which is the one on
electronic gambling, because there are fairly
important inter-governmental as well as international,
implications in that task.
So we presented the report in two parts:
7.A and then we did it for Section 4. And we divided
each of the tasks into two parts. One was the
background which we tried to identify the critical
issues and explain and discuss the subject matter.
And then we had a part on research tasks -- or the
research task -- where we tried to provide our
objectives, methodology, study considerations, and
deliverables.
I might mention that, in the first,
introductory section of our report, I tried to make
the point that on all of the tasks you have to
approach Indian gaming a little differently, because
the issues, the perspectives, the problems and
processes are slightly different in that case. So in
every one of the tasks that we address in the report
there is a section in there where we try to address
the Indian issue as well.
In the methodology that we propose on all
of the tasks, we do not propose original research.
That seemed to be out. There wasn't time, there
wasn't money. So we relied rather, on surveys,
literature, and electronic searches in consultation
with appropriate, national organizations and gambling
experts. The surveys of course, would go to state and
local governments, appropriate experts, and Indian
tribes.
The methodology -- I mean, we struggled
with this because we realized we had limited time and
limited resources. We tried to make in each task, the
research manageable. In our first paper that I think
we presented with that, when you had a meeting -- your
prior meeting -- we asked a lot of questions. We
didn't know what we wanted to do by limiting the
research; we thought that was something that you would
want to be involved with, so we simply asked
questions.
This time we simply recommended how we
would limit the research. For example, the task of
collecting all Federal, state and local laws and
regulations -- not to mention constitutional
provisions and court decisions -- as well as Indian
tribal regulations or law, whatever we may find --
that would be an enormous task. I mean, that would
take a long, long time.
And in addition, we were told to
"catalogue the results", and by that we assumed that
we were talking about a database. So we tried in the
methodology, to show you how we would limit the scope
of that work to make it manageable and yet still make
it effective.
The issue on gambling revenues is another
example -- or in the second, part 4.B when we talk
about economic cost, if we tried to take that from its
broadest perspective, the cost would be substantial
and the time probably would not be sufficient to do
that. And so we tried to show you in that
description, how we would limit our definition of
costs and economic costs so that the research would be
manageable in the timeframe.
I also talked with Dr. Kelly about the
cooperation we would give to the Commission, the
concern being that as we did our research, given the
time constraints, that if there wasn't close
cooperation and coordination that the delivering of
the data may not be sufficiently in time to meet your
timeframe.
So I promised him without fingers crossed,
that we'd be more than happy to provide all of the
briefings, all of the interim reports that you would
request, so that you would be kept up on the progress
of our research.
I'll mention a little bit about the
budget, as I know it's a sensitive issue. I struggled
with this because I know you're between a rock and a
hard place as far as your resources go, and I know
that there has been concern about the weight of our
Commission on that budget, and I sympathize extremely
with that. I therefore, worked as much as I could to
keep those costs down, and I've probably gone out on
a limb in some respects.
The overhead I know, is the one issue that
you were all concerned about. We can't get rid of the
fact that we have some fixed costs; however, we do
have some other funds and I believe that we can add to
those funds over the next 12 to 14 months.
So I went out on a limb and tried to lower
the cost of the research by simply promising that you
would not be asked to pay for any more than 50 percent
of what our true, fixed, overhead costs are. I'll
pick up the rest -- I hope -- with the funds that we
have and the funds that we hope to bring in.
We too, by the way -- you're talking about
going to the Congress -- we've been making some
inquiries about whether or not we can get our
legislation modified so that we can actually pick up
some other contractual activity. If we could do that,
obviously that would lower the cost even further
because then more things would be sharing the overhead
than just the one project.
We've had a number of people come to us
and ask us to actually do other things and we've had
to turn them down. So if we can get something in our
legislation that says that you can undertake other
contractual activity, we would then be able to, I
think, offer more for less -- I love that statement.
And the budget that we presented to you,
which was budget for 7.A and then a budget for the
other tasks -- 7.A looks pretty bad because all of our
costs are obviously included into one task, including
the overhead and all of our staffing costs.
If we were asked to undertake other tasks
-- 7.A, perhaps two or more tasks under 4 -- then of
course we spread those costs out and it doesn't look
nearly as high per task. So obviously, the most cost
effective approach for us would be to spread the costs
across several different tasks.
So we have tried to minimize it to the
best that I can. I'd be more than happy to answer
specific questions about specific tasks.
CHAIRPERSON JAMES: Any questions?
COMMISSIONER LANNI: I have one, Madam
Chair.
CHAIRPERSON JAMES: Commissioner Lanni.
COMMISSIONER LANNI: Relative to other
individuals coming to you or entities coming to you
and asking for your taking on additional tasks, are
you suggesting that if you were to consider taking on
additional tasks that you would come back before this
Commission or staff to determine or define what it is
you would be asked to do, how much effect that would
have on your resources, and for this Commission or the
staff to evaluate?
MR. GRIFFITHS: Well, yes. Right now we
have a very limited staff; we obviously have fixed
overhead. Even though we're only asking that you pick
up a part of our overhead, still, that part has to be
spread across this one Commission. Our staff would
all be devoted to this project.
If we had other contracts the overhead
would then be spread across additional contracts and
staff resources could then be also spread across other
resources while bringing in some other help.
I've run basically, a contract granting
organization for over 16 years, and I can tell you
that if we were able to bring in more contracts, the
costs to this Commission would be less -- for the same
amount of work.
COMMISSIONER LANNI: Maybe I can restate
my question. My question really pertained more to, if
you are to take on additional contracts beyond this
particular contract -- which I understand at this
point is the one that you are mandated -- or we are
mandated, relative to you --
MR. GRIFFITHS: Yes.
COMMISSIONER LANNI: -- my question was,
are you going to come before this Commission and
staff, its Chairman, to explain what task you've been
asked to take on, for this Commission to evaluate, in
its opinion, your ability to do that and also fulfill
the function that's required here? That was my
question.
MR. GRIFFITHS: The answer is yes. I
think it's a very fair concern on your part.
COMMISSIONER LANNI: Thank you.
CHAIRPERSON JAMES: I'd like to ask the
members of the Research Subcommittee how they would
like to proceed at this point. I have a suggestion,
but I'd like --
COMMISSIONER LOESCHER: I think how we'd
like to proceed is what I referred to earlier. Dr.
Reuter and Dr. Kelly will now begin to do their work.
They're going to be staying in close contact with the
three members of the subcommittee. The ACIR, as that
work develops, will be brought into our considerations
as a part of, you know, our integrated approach to how
we do the rest of the research.
CHAIRPERSON JAMES: Right. I think in all
fairness to ACIR, as quickly as we can, what we need
to do is to figure out how that's going to be
integrated so that we can get to the contractual phase
and get those issues resolved so that they can --
COMMISSIONER LOESCHER: Project design is
the next critical piece and that's where, when we get
further down the road on that, that's how we're able
to relate these pieces together, and ACIR could be a
part of that.
CHAIRPERSON JAMES: Dr. Dobson.
COMMISSIONER DOBSON: I will -- I'd like
to put on the record why I will oppose the proposal as
it's now written. The research contract that's been
proposed is $919,000. We've already committed
$620,000. Those two together make over 1.5 million;
we only have 1.22.
So we would already be broke for the
entire proposal that we just submitted, and will not
have produced any original research. We will only
have massaged what is already known. And I think that
would not be a satisfactory conclusion to this
Commission.
The ACIR also proposes to rely almost
exclusively on outside consultants for its tasks, and
so it is primarily just a middle-man, and a very
expensive one at that.
In regard to the consultants that are
proposed to be used, one person who is named
specifically by the ACIR is Whittier law professor,
Nelson Rose. The Columbia Journalism Review reported
in 1994 that for the past three years Rose has been a
partner in a plan to develop a string of Indian-owned
casinos in Southern California. This is in another
document as well.
There are eight or ten reasons of this
nature why the proposal that's on the table will not
be acceptable to me, and I will vote against it.
CHAIRPERSON JAMES: Well, we're not asking
for a vote on that proposal just yet, but I --
COMMISSIONER DOBSON: I understand. I
simply wanted to put that on the record.
CHAIRPERSON JAMES: Absolutely. And I
think it's important for Commissioners who have other
objections to express those objections at this point
so that as the Research staff begins to work with ACIR
they can address those issues. So Dr. Dobson, I think
it's entirely appropriate. If there are others, you
express them at this time.
COMMISSIONER LEONE: I only have a
comment. I think Dr. Dobson was actually correct when
he opposed the original commitment of $600,000. I
voted for it because I knew time was a factor. But
this -- we really -- there has to be harmony between
our budget and our commitments.
We might want to re-orient the budget to
put more money into research. I don't know if that's
possible. But I think that you don't have to get into
any detail to say that at some point we're going to
need a Research proposal which fits within what
remains in our budget. And at this point that's
$600,000 not $900,000.
So I think -- I hope we don't get to that
point, but I don't think we can do much without coming
into harmony on those two pieces of the issue.
CHAIRPERSON JAMES: No question.
MR. GRIFFITHS: I would appreciate it too,
if -- the information that you just mentioned, I did
not know. But I would like to know that; it would
help me as well.
COMMISSIONER DOBSON: I'll be happy to
provide that to you. Now -- may I continue --
CHAIRPERSON JAMES: Absolutely, Dr.
Dobson.
COMMISSIONER DOBSON: There very well may
be other contractual relationships with ACIR that I
could support. What I'm speaking to today is this
$900,000 proposal which does not fit in the budget as
I see it.
MR. GRIFFITHS: Well, in all fairness, the
Chairman did not ask me to submit a proposal for all
of those for you to be considered. The 900,000 was if
you gave us all the tasks this is what it would cost,
but honestly, that's why she had me break it into two
parts.
If you just did 7.A what would that cost,
and if you just -- I think the way they wanted it, but
I didn't have the time to develop all those
combinations of budget -- was, what if you did 7.A,
what if you just did 4.A. what if you just 4.B, what
if you did 4.B and 4.A? I mean, the combinations and
permutations were rather large and so I tried to --
COMMISSIONER DOBSON: It is my -- again,
may I?
CHAIRPERSON JAMES: Absolutely.
COMMISSIONER DOBSON: My understanding in
reading the correspondence between you and Dr. Kelly,
that he did express some financial concerns and asked
for accommodation on some of those items. And your
answer to most of those was no. Your response to
cutting overhead or doing other things to help us get
a total down that we could deal with was, these are
reasonable and this is the way -- this is how we have
to function.
MR. GRIFFITHS: Well, I did submit a
couple of different proposals to Dr. Kelly. The last
one was after a lot of soul searching. I did tell him
that the last one I submitted, if I went any lower it
was unrealistic. I would go bankrupt; I couldn't do
it. But --
COMMISSIONER DOBSON: And if we accept it,
we're bankrupt.
MR. GRIFFITHS: Well, unless of course,
that I could find some other funding, which is another
issue. But I don't think if you contracted with the
National Research Council or if you contracted with a
university, or you contract with anybody, I honestly
don't think what we proposed as the final overhead
figure is out of line with any other figure you're
going to get.
In fact -- I won't say it, because I mean,
I just -- I know that's it's probably fairly
competitive because we're hiding a lot of stuff that
we're not charging for, whereas the others may not be
quite as generous to hide all of that.
CHAIRPERSON JAMES: Just for a point of
clarification for the full Commission, in the
estimated budgets that were submitted to us by ACIR,
919 was for all tasks, and I did ask them to separate
it out so that we would have the opportunity -- and
you may look at that and see that the lower figure of
467,000 is there.
What I'm suggesting at this point is that
the Research Subcommittee incorporates components of
what -- and make a recommendation back to this
Commission -- about what components of this, if any,
should be included in the overall research scheme and
have that as a part of the telephone call or however
we get the next step done.
Leo, you look confused --
COMMISSIONER LOESCHER: No, I've stated
exactly that, twice.
CHAIRPERSON JAMES: Absolutely. And I
want to be sure that that's where we are. Okay, thank
you very much. We appreciate your being here today.
We look forward to hearing from the
Research Subcommittee and we'll facilitate that
happening in a way that will accommodate the varied
schedules that exist among our Commissioners.