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Play Meter

Issue: 1974 December - Vol 1 Num 1

operating
Operators feel resistance
Passi ng on costs to locations
While most operators agree that
they must "get a better deal for
themselves" from location owners on
the ir routes, many operators are start-
ing to feel resistance toward revamped
co m m iss i on arrangements and / or
higher pr icing.
And an unhealthy competition cli-
mate is developing in some U.S. cities
among operators who apparently d isa-
gree on pr ici ng of mu sic.
Severa I operators offered some
pretty solid arguments they have re-
lated to location owners on their
routes that tend to justify the ir trying
to change commissions. Others
thought higher pricing was the answer
to solv ing their money woes.
" The cost of everything is going up,
and it's affect ing my operation from
labor to laundry to service to parts to
equipment," said Donald A . Anderson
of A & A Amusements Co. in Port-
land, Ore .
"We are going to have to ask all of
our customers for more money," he
said .
While much of Anderson 's equip-
ment is on rental , he said he will ask
for "some sort of guarantee" on ma-
chines where a commission set-up is
currently in effect . For instance,
Anderson may ask location owners for
a $20 guarantee per co lIection or 60
percent of the take, whichever is
greater.
And he thinks location owners will
accept the idea.
"We expect to have real good luck
with it," Anderson said . "After all,
everybody's operating costs are going
up, and we're no different from every-
body else ."
Anderson added that the life ex-
pectancy of new machines is shorter
than older models, "so you have to
make your money off the machines as
quickly as you can."
Lou G lass, w i th Modern Specialty
Co . in Madison, Wisc., ant icipates
problems in the revamped commission
idea.
See COSTS, Pg- 7
The fuel squeeze: No relief in sight
Gasoline, or rather the lack of it, is
presenting a two-fold problem area for
operators around the Un ited States_
Constantly-rising gasoline costs are
hurt ing operators who have to contend
with the problem of servicing their
routes, and is meanwh ile hurting col -
lect ions on those same routes.
And although the long lines to
service station pumps which the nation
experienced last summer seem to have
shortened, and service stations again
appear to have ample supplies of fuel
for their customers, the price of the
commod ity hasn't even hinted at drop-
ping.
I n fact, federa I energy spokesmen
say, the nation may be under a false
impression that gasoline is again avail-
able to meet the ever-increasing de-
mands of c(.;stomers, simply because
the lines to gasoline pumps have van-
ished.
But that simply is not the case. The
nation's fuel crisis has shown few signs
of lessen ing, and negotiations between
the United States and oil -rich Middle
East countries are dragging on .
Mrs. Betty J. Hollingsworth of
Dixie Amusement Co. in Chattanooga,
Tenn. said she has begun a sy stem of
I EXTRA I
See FUEL , Pg. 7
5
In 3D-year battle:
M OA copyright win apparent
WASH INGTON, D.C. - Officials
with the Music Operators of America
credited a "tremendous response"
from people in all facets of the music
and games industry for winning a
battle in the U .S. Senate recently in
the Bill for General Revision of the
Copyright Law.
"Everyth ing the M OA opposed was
defeated," said a recent newsletter to
MOA members.
The original Senate Bill (S. 1361)
contained several provIsions that
would have established a statutory
recording arts royalty, granted author·
ity for a Copyright Royalty Tribunal
to readjust the $8 performance royal ·
ty, and installed a 50c jukebox regis'
tration fee .
Senators Sam Ervin and Ernest Hol-
lings introduced amendments to the
bill , which were co-sponsored by
several other senators, on behalf of the
MO A.
Their amendments, which deleted
all the provisions opposed by MOA, all
passed, in a solid victory for the MOA.
The b ill went to the Senate floor
for debate on Friday, Sept. 6, and the
final vote came on Monday, Sept. 9, in
favor of the jukebox operators.
MOA officials offered their "heart-
felt thanks" to the people who respon-
ded to the ca ll and wrote letters and
made telephone calls to U .S. Senators
in protest to th e provisions.
Nicholas E. Allen represented MOA
in the legislative battle . He will report
on that battle at the upcoming MOA
Exposit ion General Membersh ip Meet-
ing on Saturday, Nov. 2 in Ch icago.
Ed itor's Note : Further remarks on
this story may be found in this issue in
Play Meter's "Co inman of the Month"
feature - an interview w i th Russell
Mawdsley , MOA president .
•••
La. appeals coin-op sales tax ruling
BATON ROUGE , LA . -
Argu-
ments are schedu led to be heard No-
vember 4 in a Lou isiana appeals court
over the legality of charging operators
in the state sales taxes on revenues
der ived f rom their amusement ma-
chines.
Already under appeal , the matter
will likely be finally dec ided in the
Lou isiana Supreme Court, according
to legal counsel for the operators .
Judge Luther F . Cole ruled in favor
of state operators when he quoted
from pr ior decisions in his 19th Ju-
d icial Court ruling, saying , "Tax laws
are to be liberally interpreted in favor
of the taxpayer and strictl y construed
against the taxing authority . Any
doubt or ambiguity is to be resolved in
favor of the t ax payer."
Judge Cole referred to the inter-
pretation of a state law recently ren-
derred by Lou isiana Collector of Reve-
nue Joseph N . Traigle. In letters issued
by Traigle's office on Sept. 24, 1973,
operators were informed that effective
Oct. 1, 1973, they wou Id be included
under the state sales tax law, in a
section that had in past years applied
only to admissions to places of amuse-
ment or athletic events; or for dues for
clubs which furnished amusement, ath-
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letic, recreational or amusement facil -
ities.
Traigle's action followed his own
interpretation of the law, in which he
indicated that the word, "facility,"
should be construed to include coin-
operated amusement machines.
Judge Cole agreed that Traigle has
the legal power to "reasonably"
interpret such laws in a 1962 state case
where the court ruled the Collector of
Revenue has the r ight to promulgate
reasonable rules and regulations for
the collection of state sales taxes, but
does not have the author ity to re o
define the statute to read as i t best
suits him.
I n render ing the lower court dec i-
sion, Judge Cole said he felt the word
"facility, " as commonly def ined in
dictionar ies, in other legal decisions,
and as previously used by the Louis-
iana Legislature, did not include
devices, equipment or machinery. If
the Lou isiana Legislature had intended
to tax coin -operated machines, Judge
Cole sa id, it would have so stated .
As Traigle's Sept. 24, 1973 letter
was interpreted by operators, they
were told to take 3 percent of the
gross receipts from coin -operated ma-
ch ines and submit that sum to the
Department of Public Revenue .
"Operators are still bound by law
to submi t the sales taxes to the state,"
said Lawrence L. Lagarde, legal coun-
sel for TAC Amusement Co ., pla intiffs
See T AX , Pg_ 48
6
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