Slots: Not Economic Development

Mr. Kostrzewa's article below clearly and simply defined the false promises of slot parlors and casinos as quick solutions being offered.

Professor Robert Goodman (in "The Luck Business") addressed the unlikelihood of desirable companies locating within proximity of casinos due to the increased crime that accompanies them.

Studies indicate that crime increases within a 50 mile radius.

Not only is Fall River's decision flawed, but will likely preclude more desirable development.

So true --

Real economic development takes years of hard work. It takes energy and commitment.

And it has to be led by public officials.


John Kostrzewa: Banking on casinos is a threat to innovative, knowledge-based jobs of the future

May 30--Massachusetts state workers are clearing trees on 300 acres in Fall River that were targeted for a biotechnology manufacturing plant and high-tech employers.

It was part of a plan put together by city and state officials, in partnership with the University of Massachusetts, to lead the area out of its chronic economic woes by developing well-paying, white-collar jobs to replace the factory work that is long gone.

But during the last two weeks, city officials have changed course.

With dollar signs dancing in their heads, city leaders have decided the site is better suited for a casino, and they have cut a deal to sell the land to the Mashpee Wampanoag Tribe.

Does all this look familiar?

Rather than doing the hard work, piece by piece, to attract the knowledge-based jobs of the future, the politicians chase the quick fix of easy money and a short-term promise of jobs that will get them through the next election.

Taxpayers have seen it again and again during the last 10 years.

In fact, it's in danger of playing out again just 20 miles down Route 195 at the State House in Rhode Island.

During this legislative session -- three years after the state fell into a deep recession because of its reliance on an old industrial and construction economy -- Governor Carcieri and lawmakers are trying to begin the long process of rebuilding Rhode Island. Last week, they debated proposals to make the tax code more competitive, help entrepreneurs raise capital and cut red tape for small businesses.

Much more hard work needs to be done to change Rhode Island's economy.

Since 2004, the number of high-tech jobs in Rhode Island has hovered around 22,000, or less than 5 percent of all jobs, according to the latest report of the New England Economic Project, a nonpartisan, nonprofit group. NEEP forecasts high-tech could be among the fastest-growing sectors, and the core of a new economy, if the right climate is created.

But while that discussion continues, there is yet another debate underway in Rhode Island about putting a referendum on the November ballot to allow full-scale casinos at Twin River in Lincoln and Newport Grand in Newport.

With the state expected to take in $292 million from the two sites this year, some legislators worry that plans taking shape in Massachusetts to license two casinos and perhaps slot parlors at dog tracks will siphon off gambling dollars, creating new holes in the state budget. The announcement of the Mashpee Wampanoags' plans in Fall River has raised the stakes, they say, because the tribe's casino would be just across the border and attract gambling dollars once headed for Rhode Island.

The danger is that the gambling debate, fueled by lobbyists for big-name companies, will grab the legislators' attention, change their focus and overwhelm all other issues at the State House. Real economic development will be pushed to the back burner.

The latest push for a full-scale casino in Rhode Island accelerated after Fall River Mayor Will Flanagan announced two weeks ago that he supported the Mashpee Wampanoags' plan to build a $500-million casino with three hotels, a water park and a shopping center on the site.

"As the mayor of Fall River, I have a responsibility to the people who elected me to put them back to work," Flanagan said.

Last week, the Fall River Redevelopment Authority voted tentatively to sell the land to the tribe for $21 million.

But it's far from a done deal. The tribe, which once planned a similar casino in Middleboro, Mass., has many hurdles to clear.

For example, the land was once part of Freetown State Forest. The transfer of the property from the state to the city includes a restriction that the site could not be used for a casino. That provision would have to be repealed by the legislature.

Also, casino gambling is illegal in Massachusetts. The governor and legislature would first have to legalize gambling. Then, the Mashpee Wampanoags would have to beat out many other competitors to win one of the licenses awarded by the state.

In addition to all that, Fall River residents would have to approve the casino.

If this effort fails, the tribe could still try to go the federal route to build a casino outside of the control of state regulators. That would require placing the land in a special trust, with the approval of federal regulators.

But land trust requests for some tribes were essentially frozen by a recent Supreme Court ruling. The Mashpee Wampanoags were one of them.

That's because the tribe was not formally recognized until 2007, and currently only tribes recognized before 1934 could use the land-into-trust process. Congress would have to give permission to tribes recognized after 1934 for them to place land in trust, which would allow them to build a casino.

Still, the tribe, which says it has financial backing from Arkana Ltd., the firm that invested in Foxwoods Resort Casino, in Connecticut, thinks it took a big step by acquiring the option for the land in Fall River.

"This proposal will bring economic opportunity for the tribe and its people, while also directly and indirectly creating thousands of jobs in Fall River during construction and subsequent operation," said Cedric Cromwell, chairman of the Mashpee Wampanoags.

One thing's clear. The proposal attracted plenty of attention, and not all positive.

In making the deal for the land, city officials reversed course on plans, years in the making, to create a SouthCoast BioPark on the 300 acres. Massachusetts previously earmarked $17 million for the University of Massachusetts-Dartmouth to build a biomanufacturing plant and access road on the site.

The state also committed $35 million, partially funded with federal stimulus money, to build a connector to the biotechnology park from Route 24.

Now, University of Massachusetts officials say they are considering other sites. And administrators for Massachusetts Governor Patrick say the state will demand repayment for any money used for access roads if the site is designated for a casino.

After some public backlash arose over the casino project, Mayor Flanagan came up with an alternative.

He said he wants to acquire 150 privately owned acres in Freetown, near the casino site, for the technology development.

He said both a casino and a biopark can be created side by side.

Right.

Which one do you think will get the most attention?

There is no question that gambling, and the money it generates for states, is here to stay. It's built into state budgets already under stress, and there's no easy way to replace it.

But gambling and casinos are not true economic development.

They do not create the base for solid, long-term jobs on which a thriving economy is built.

Real economic development takes years of hard work. It takes energy and commitment.

And it has to be led by public officials.

When they lose focus, and gamble only on flashy, short-term returns, nobody ends up a winner.

John Kostrzewa is assistant managing editor/commerce & consumer issues. Reach him at 277-7330 or at jkostrze@projo.com