Separating Truth from Fiction

While the American Gaming Association (AGA) does not take a position on the issue of gambling expansion, we do find it necessary to address frequent misconceptions about our industry. As the casino referendum on the November ballot draws near, it is crucial to separate truth from fiction and let the facts tell the story of the myriad benefits the gaming industry brings to the communities where it operates.

In 2005, the U.S. commercial casino industry provided more than 354,000 jobs with wages and benefits totaling more than $12 billion. Nearly $5 billion in gaming tax revenue in 2005 helped state and local governments fund infrastructure improvements, education, public safety, housing, healthcare and other programs.

Several independent studies have been conducted in the decade since the AGA’s existence, nearly all reaching a similar conclusion. Despite the impassioned objections of some, the benefits of gaming are indisputable. In the late 1990s, the National Gambling Impact Study Commission (NGISC), a federal study commission mandated by Congress, found that, in addition to employment and revenues, communities closest to casinos experienced a drop in welfare payments, unemployment rates and unemployment insurance.

Residents of Rhode Island already are well acquainted with these benefits brought by gaming, thanks to the success of Connecticut’s two Indian casinos. But previous arguments published by this paper have asserted that bringing an additional casino to the state would “threaten the very fabric of the restaurant, clothing and entertainment industries in Rhode Island,” or that the “tourist industry could implode.” (Casinos the Worst Business Deal for Rhode Island, Providence Journal, Sept. 29). To the contrary, research shows the introduction of a casino expands the overall economy of its host community, in many cases benefiting existing businesses.

An economic analysis prepared for the NGISC by Penn State University economist Adam Rose found little evidence of economic substitution after the introduction of new casinos. As his meta-analysis reveals: “The preponderance of empirical studies indicate claims of the complete ‘cannibalization’ of pre-existing local restaurants and entertainment facilities by a mere shift in resident spending is grossly exaggerated.”

Casino gaming has been proven to expand local businesses as they are able to develop key vendor relationships with area casinos. A 2005 study conducted by the Center for Governmental Research (CGR) and Gaming and Resort Development analyzed the Seneca Niagara Casino’s impact on Niagara Falls, New York and states, “The casino itself is creating new employment opportunities for its residents which will stimulate neighborhood revitalization, increase sales and property tax revenue and create new demand for goods and services within the community.”

This data confirms that the introduction of casino gaming brings increased revenues to state and local governments, promotes tourism and increases the overall quality of life enjoyed by local citizens. But you don’t have to take my word for it. You need only talk to the civic leaders who live and work in gaming communities to get the truest picture of the impact of commercial gaming.

In 2005, the AGA commissioned a survey of opinion leaders in communities with commercial and racetrack casinos, including mayors, city and county council members, economic development officials and others. The results underscore what the commission research and other studies have shown: Elected officials and civic leaders are strikingly positive about the impact casinos have had on their communities and surrounding businesses. By a margin of more than three to one, community leaders said casinos have done more to help rather than hurt other businesses in the community. And in perhaps the most telling result of this survey, a full three-quarters of civic leaders and elected officials said, if given the chance to vote again, they would elect to bring casino gaming to their communities.

If poll results and economic data are insufficient evidence of the benefits of gaming, the most compelling case of all is in Iowa, where in 2002 citizens in all 11 counties that opted for casino gaming or racinos eight years ago overwhelmingly voted to retain them, with margins of victory ranging from 63 to 81 percent. And in June 2003, seven additional counties voted to approve gaming in their counties. Surely these are not the decisions of communities negatively impacted by gaming.

Each citizen and policy maker is entitled to his or her own opinion regarding casino gaming, but surely everyone would agree that when deciding on such an important issue, the votes should be based on the facts. Anything less would be a gross disservice to your readers and ultimately detrimental to the state of Rhode Island.