Bars and taverns seem to be sticking with video poker.
Only nine of the state's 2,158 video-lottery retailers decided against renewing their contracts when the old ones expired late last month. Another 35 have yet to make a decision, said Marcia Hutchins, who oversees retailer contracts for the Oregon Lottery.
The 98 percent renewal rate followed threats of a mass exodus after the Oregon Lottery Commission reduced the compensation that retailers could keep from the state-owned video lottery machines.
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Under the prior compensation plan, retailers' average commission was $74,000, or 32 percent of sales. Under the new contract, the average commission is forecast to be $67,000, or 29 percent of sales.
A report commissioned by the Oregon Restaurant Association predicted that 15 percent of bars and taverns would drop video poker if there was any cut in their take.
Political activist Steve Novick argued for deeper cuts in compensation so the state could increase money for public services. He said the renewal rate shows that lobbyists overstated the negative hit that would result from a drop in commissions. And it also means the Oregon Lottery Commission should have reduced compensation even further.
"This tells me two things," Novick said. "First, the Oregon Restaurant Association spent months lying through its teeth. Second of all, the Oregon Lottery has exposed itself as the least businesslike organization in human history."
Bill Perry, a lobbyist for the Oregon Restaurant Association, said it was too early to draw any conclusions about how the new rates would affect the bottom line for bars and taverns. He predicted that businesses could still cut employment or curb hours to make up the difference.
"There's going to be a negative ramification from this. Whether it's small or big nobody really knows," Perry said. "It's just too early to tell."
One of the nine businesses to get rid of video poker is Jo Federigo's Restaurant & Jazz Club in Lane County.
Owner Jerome Seljian said it wasn't because the compensation rate dropped a few percentage points. His decision came after the lottery asked him to remodel his place so patrons in wheelchairs could access the video poker machines, a costly endeavor.
Frank Wilson, owner of Frank's Restaurant & Lounge in Mapleton, renewed his contract.
"Oh sure we're going to keep the machines," he said. "The cut wasn't as bad as we thought it would be."
Source: Associated Press
