Point Defiance Café and Casino owner Steve Fabre has taken a long-standing conflict with Ruston Town Council to the courts. He is asking for what he describes as a conservative $9.7 million in damages. Yes, $9.7 million. Fabre says the total equals less than losses calculated since Ruston Town Council passed an ordinance raising gambling taxes from a sliding-scale 1 to 3 percent to 12 percent. That’s, at minimum, a 400 percent increase. For Fabre, the increase inflated his gambling tax contributions from an estimated $1,600 to about $10,000. So far, Fabre has avoided the tax by closing down all taxable gambling operations. He still runs a few specific types of card games that fall outside taxing jurisdiction. But the loss of revenue from his house-banked card operations has cut his earnings to, well, about zilch. Actually, it’s less than zilch. 

“I just wrote a personal check for $23,000 to keep this place going,” says Fabre. “My other business and house are mortgaged. They took everything.” 

Well, not everything. Fabre still owns the business, and his other operation — the relatively successful Cassidy’s Pub and Outdoor Mini Golf in Tacoma, which Fabre has kept alive for 23 years. He set up in Ruston, near the corner of Ruston Way and Pearl, in anticipation of a swelling population. Around the corner from Fabre’s, um, well, it’s a restaurant now, developer Mike Cohen is building the massive Point Ruston master community. 

Fabre says he has lost money on the Point Defiance Café and Casino since it opened. In 2007, he closed out the books at negative $80,000. He lost about four times that in 2006. It was even more in 2005. If that seems absurd, Fabre and most property and business investors would remind you that many businesses operate at a loss for years in hopes of a big payoff. The details of how businesses can afford to operate at such a loss would require more space than we have here.  It has a lot to do with tax write-offs and juggling investments, and it happens all the time. Most business owners are smart enough to make it work. His predictions of profitability began to come true earlier this year, when Fabre says his losses were dwindling. He  might have made it into the black if it weren’t for rising gas prices, blah, blah, economic downturn, blah. In April, things started to go south. Then, in July, Ruston Town Council, citing a need to shore up dwindling city budgets, passed an ordinance raising gambling taxes. It is worth noting that Fabre’s is the only casino in Ruston. He is also Ruston’s largest employer and pays more taxes than any other business in town. That is until now. Fabre has since laid off 40 employees, including his wife, daughter, three nephews and his niece. 

 

“I made more money selling 35-cent beers (at Cassidy’s in the early ’80s) than I’m making now,” says Fabre. 

Fabre’s attorney has requested an injunction, says Fabre, and is seeking damages for lost revenue. Passage of the tax did not meet Ruston’s legal voting criteria, and Ruston has not sufficiently established need for the tax, which invalidates the ordinance under state statute. Also, Council did not take public comment before passing the resolution and didn’t require a second reading before voting. Council did take public comment after passing the ordinance, however.



Fabre is not aware of any other new taxes passed to supplement city budgets. Without the tax from his business, he notes, town officials will now have to bank on timely completion of the first phases of the Point Ruston development to save it from impending bankruptcy. 

 

“It just doesn’t make sense,” he says.