Originally created 04/27/97

Few firms own most of state's video poker



ROCK HILL, S.C. - A handful of companies control about half the video poker machines in South Carolina, creating some not-so-small fortunes for those few, a newspaper reported Saturday.

The state Revenue Department says half the state's 21,647 gaming machines are owned by 15 firms, The (Rock Hill) Herald reported.

Jimmy and Cindy McDonald of Lancaster rank among the top two video poker operators in the state, according to Revenue statistics. McDonalds Amusements and McDonalds Gaming own nearly 1,300 machines statewide.

And the average video poker machine produced about $19,500 in profit for the first nine months of 1996, the most recent period with available data, the agency said.

That was before a ban on the games in 12 counties was lifted in November by the state Supreme Court. The court ruled that what's legal in some counties can't be criminalized in others.

The numbers indicate that the McDonalds' machines produced about $25.2 million in profit during the first nine months of 1996.

Mr. McDonald could not be reached for comment Friday, the newspaper said.

"Most people believe the reports are probably conservative," said state Sen. Wes Hayes, R-Rock Hill. Mr. Hayes authored a bill to assess civil rather than criminal penalties on video-poker operators and restore the bans in the 12 counties that voted them out in a 1994 referendum.

"We always had maybe 20 small companies control the biggest part of" the industry, said J. Mathis Brown, whose family runs J. M. Brown Amusement Co. Inc. in Gaffney. His is the fifth-largest poker-machine company in the state.

"Video poker is an expensive business because the machines, what's hot and what's not, change quickly," said Revenue Director Burnet R. Maybank.

Only in the past year or so have machine owners had to file reports on their machines' cash flow with Revenue officials, said Mr. Maybank, who refused to release information on individual machine's proceeds.