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The terms house-banked card rooms and casinos are used interchangeably in this story. The number of such card rooms that report their revenues to the state grew here from six in to 11 in , and was reported at eight in mid-May by the Washington state Gambling Commission.

Since then, Bluz at the Bend, at N. Market, has closed its gambling operations. Representatives from three of the seven house-banked card rooms currently operating in Spokane County say competition from Northern Quest, anti-smoking regulations, and taxes assessed by local government entities are making it difficult to stay in business.

House-banked casinos differ from fee-collected card rooms that were common before and still exist in other parts of the state.

Unlike house-banked casinos, in which the casino sells chips to players to use when they play card games, fee-collected card rooms charge gamblers for each half-hour they sit in a gambling seat.

Robert Varney, a spokesman for Bluz at the Bend, which got state approval to operate a house-banked casino in October , says that establishment closed its gambling operations because gaming didnt provide enough volume to pay the overhead.

Its difficult to blame it on the Indians, he says, but the smoking ban didnt help. Our revenues dropped off about 30 percent almost immediately after the smoking ban was enacted.

Casinos typically win a statewide average of about 26 percent of how much money each banks when players buy chips, but normal operating expenses such as labor, taxes, and food and alcohol cut into those profits, says Scott Walker, director of gaming for Hooters Owl Club Casino, at E.

Boone, says, Its not an equal playing field. He notes that Northern Quest and other Indian-operated casinos in the state can offer games of chance such as craps and roulette, and also electronic lottery machines for gambling purposes, all of which are prohibited in house-banked card rooms.

Instead, legalized gambling in those businesses is basically restricted to table games such as blackjack, three-card poker, and Spanish Hargrove also says casinos have been hurt by the initiative that outlawed smoking within 25 feet of any public building.

Northern Quest isnt bound by that state law and still allows smoking at designated areas on its premises. After Annie Fannies was sanctioned as a house-banked card room in , business started slowly, gained momentum, then peaked before more and more competition, including Northern Quest, entered the market, Hargrove says.

Revenues began to dip, and, he says, The smoking ban was the straw that broke the camels back, although Annie Fannies is still in business.

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Sprague, which are both operating casinos here, says, People in the industry want to fault the tribes, but its not about them. Theyve done a great job.

They are in a position where they have a monopoly, and its difficult to compete with a monopoly. Northern Quest continues to grow, says Higgins. We cant compete with their food giveaways and the entertainment they bring in.

Hooters Owl Club only opened a year ago, but since has been hurt by the smoking ban. We havent been hit as bad as other casinos here, Walker says.

We lost about 10 percent of our revenue when the smoking ban was first imposed, but after a couple months those gamblers started coming back.

He argues that the tribes have an advantage because electronic lottery machines cost little to maintain, compared with the gaming tables at house-banked casinos that are very labor intensive.

Walker says the distance from the Owl Club to Northern Quest, about 25 miles, is most definitely a factor that deters some gamblers from driving to Airway Heights, and causes many to spend their gambling hours in the Valley.

In , the state of Washington authorized local governments to collect taxes of up to 20 percent of each gambling establishments reported gross revenue.

Spokane County assessed a 15 percent gambling tax until when Spokane Valley incorporated as a city, and all of the casinos that had been in the county were absorbed into that new city, says Mike Volz, finance manager for the county.

Meanwhile, Spokane County, to attract new casinos, lowered its gambling tax to 2 percent in October last year, Volz says. The only casino that has relocated to the county since it took that step was Aces Casino Club North, at N.

Division, which moved from Spokane Valley to the county. Higgins says, When the county lowers the tax to 2 percent and there are hardly any entries in the market, thats an indicator that gambling casinos isnt a great business to get into.

The city of Spokane, which had historically taxed card rooms the maximum 20 percent, decided to lower its gambling tax as well. The Spokane City Council voted to reduce its gambling tax to 15 percent effective Jan.

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