Tuesday, October 18, 2011
Casino Effects on Business, Charities, Job Seekers & Host Towns
Hospitality & Charity Revenues Whalloped; No Net New Jobs
The House Ways & Means Committee will vote on HB593, the two casino monopoly bill, on October 26. Please contact committee members and ask them to vote NO.
Here is how the bill would affect New Hampshire hospitality businesses, charities, casino host communities, and job seekers:
Hospitality: $100 Million Revenue Lost -- $65 Million in Comps
Revenue breakdown data (sources, assumptions) reported by local market casinos (like those proposed for Salem and Hudson) shows what existing New Hampshire restaurants, lodging, and entertainment establishments will face:
$100 million per year in consumer spending diverted to casinos, with heaviest revenue and job losses by New Hampshire hospitality businesses - if even one of the two casinos permitted under HB593 is built. This loss would increase by 30% or more if the two permitted casinos are built.
The typical convenience casino gives away (comps) rooms, meals, beverages, and entertainment to boost gambling revenue. A single New Hampshire casino as proposed in HB593 and operated in a typical manner would give away $65 million annually in comps.
Charity Revenue Wipeout
In FY 2010, charitable gambling (table games, bingo, Lucky 7, etc.) contributed $11 million dollars to over 300 New Hampshire charities. BusinessNH Magazine's October feature story reports that casinos with slot machines would "decimate" charitable gambling. The slot casino lobbyists for Millennium Gaming who wrote HB593 know this and therefore amended the bill with a promise to level fund these charities. Here are the problems with this promise:
No legislature can bind the budgets of any future legislative session. Next time the state faces a budget crunch or when casinos come crying about declining revenues in the soon-to-be saturated New England gambling market, bye-bye charities.
If you don't think that this funding promise for charities is easy to break, look at the budget history for LCHIP (Land and Community Heritage Investment Program): zeroed out this year.
The provision allows for no change in the changing needs of charities, by capping both funding levels and freezing distributions only to current charity beneficiaries.
Run the Numbers: No Net Permanent Jobs
The U.S. Department of Commerce estimates that, for every $1 million diverted from household spending in New Hampshire, the state loses nine existing jobs. The New Hampshire Gaming Study Commission (page 19) projects that a $500 million Salem or Hudson casino would produce 2,215 permanent direct and indirect new jobs. But because up to half of casino revenue will be displaced from current consumer spending, nearly 2,500 existing jobs will be lost. Apart from temporary casino construction jobs, there are no net job gains.
Note that the median pay including tips at US casinos is $11.25 per hour.
Broken Promises To Local Business & Host Communities
Take it from Kenneth Ivins, Finance Commissioner for casino host city Saratoga Springs, New York. The casino has driven up the city's costs for police, water, sewer, roads, and schools. But, facing a budget crunch, the state just zeroed out the $3.9 million in state aid the city once received to cover the increased costs.
And there are no economic gains for local merchants. "People who come to the area to gamble rarely shop," said Ivins. "The money is not going to the local merchants or the sales tax base. It's really not supporting our economy."
No Teeth in the Destination Casino Promise
Salem and Hudson will not get the promised $500 million destination casinos because investment bankers know full well that the New England gambling market will soon be saturated and that the best casino locations are in Massachusetts, not New Hampshire. The Massachusetts legislature wants destination casinos and therefore wrote into its casino bill a requirement that a developer invest no less than $500 million in each of the three allowed casinos. Salem and Hudson will get phase I slots barns - and no more. The evidence? The gambling lobbyists who wrote HB593 included no minimum casino investment requirement.
Ask House Ways & Means to Kill HB593
Email all members: ~HouseWaysandMeansCommittee@leg.state.nh.us
Call members individually: Don't depend on someone else to make these calls:
Bill Butynski
d-Hinsdale
336-7498
williambutynski@aol.com
Chris Hamm
d-Hopkinton
746-4919
hammchristine@gmail.com
John McDonnell
r-Chichester
494-4521
johnmcdonnellnh@aol.com
Wyman Shuler
r-East Kingston
347-2011
wes.shuler@leg.state.nh.us
Laurie Sanborn
r-Loudon
682-1557
laurie4nh@gmail.com
Gary Azarian
r-Salem
890-8669
gazarian@comcast.net
Duffy Daugherty
r-Colebrook
728-8635
duffy.daugherty@leg.state.nh.us
Mary Griffin
r-Windham
432-0959
Russ Ober
r-Hudson
883-9654
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