GOP head chairs slot-machine firm

MINNEAPOLIS - The chairman of the Republican Party of Minnesota, who has criticized the state's casino compacts with Indian tribes, also chairs a company that sells slot machines to casinos, the Star Tribune reported Saturday. Ron Eibensteiner is board chairman of Spectre Gaming, which is based in El Cajon, Calif., and has an office in Minneapolis. He said Spectre grew out of a telecom company that he had headed and liquidated in 2000. Spectre Gaming is involved in the gambling machine market at a time when Republican Gov. Tim Pawlenty has threatened to open a nontribal casino to compete with Minnesota Indian casinos unless the tribes give the state $350 million a year. Eibensteiner unveiled a statewide radio ad last week supporting Pawlenty's proposal to obtain a share of tribal casino revenues. When the newspaper asked Eibensteiner about his role in the gambling business, he said he is concerned about "the perception factor," and intends to resign from Spectre's board as two additional board members are recruited. "There's going to be some discussion in the Legislature about Indian gaming next year," he said. "I don't want anybody to think that I have any dog in this fight one way or another." Eibensteiner said Spectre has no business deals with Minnesota tribes, hasn't sought any and won't in the future. He said the company has never applied for a license to sell gambling equipment in Minnesota and has no plans to do so. "He can say all day long he doesn't do any business in Minnesota. That's today. Maybe tomorrow he does business in Minnesota," said John McCarthy, director of the Minnesota Indian Gaming Association. Spectre reported losing $1.8 million in the six months ending June 30, according to statements the company filed with the U.S. Securities and Exchange Commission. The losses stemmed primarily from expenses that the company incurred for employees, consulting and other costs as it began operations. "We're a startup company at this point," said Brian Niebur, its chief financial officer. "The company designs and develops networks, software and content that provide its customers with a comprehensive gaming system," according to SEC documents. "The company anticipates that it will generate revenues starting in the third quarter of 2004." Spectre said Monday that it had begun operating games at a tribal casino in Oklahoma. Niebur declined to comment on whether deals with other casinos are in the works but said the firm has no intention of selling to Minnesota casinos. --- Information from: Star Tribune, http://www.startribune.com