Alabama could raise about $400 million in new revenue with a lottery and casinos at the state's four greyhound tracks, according to a report released today by Senate President Pro Tem Del Marsh.
State lawmakers will consider the report as they decide whether it's time to propose gaming as a way to help fund services in Alabama.
"At a time when we are talking about either massive budget cuts or higher taxes, this is something we certainly need to look at and consider," Marsh said in a news release.
The president pro-tem's office commissioned the study by the Auburn University at Montgomery Institute for Accountability and Government Efficiency.
The study found that a state lottery would generate $332 million in revenue after prizes and expenses are paid.
It found that adding slot machines and table games at dog tracks in Birmingham, Mobile, Macon County and Greene County would raise $64 million to $74 million, depending on whether the state imposed a tax of 13 percent or 15 percent.
Marsh said he commissioned the study to get an independent set of numbers about what gambling could mean for state revenue.
The state faces a projected shortfall of $200 million or more in the General Fund in 2016.
A lottery would not come in time to fix that problem because it would require voter approval in a constitutional amendment and months to set up.
Casino games would also require a constitutional amendment but could potentially produce revenue next year if a special election was called rather than waiting until scheduled elections in 2016.
The earliest special election would be three months after the session in which the proposed constitutional amendment is passed.
But the General Fund problems are not confined to 2016. The Legislature has relied on transfers and one-time sources to cover the gaps in the budget for years.
Rachel Adams, spokeswoman for House Speaker Mike Hubbard, issued a statement about the AUM report:
"Speaker Hubbard is reviewing the study and formulating an opinion, but even if a referendum were
held, it would take place well into the next fiscal year," Adams said. "This proposal does not solve our 2016 budget problem and an immediate solution is still required."
Gov. Robert Bentley has proposed raising taxes on cars and tobacco and eliminating some credits and exemptions to raise $541 million in revenue to cover the 2016 shortfall and stabilize the General Fund in future years.
Legislators have not voted on any of the eight bills in Bentley's package 16 days into the 30-day session.
Marsh said the gambling revenues can be an alternative.
He plans to meet with the Senate Republican caucus on Tuesday to discuss the report. The senator said he sent it to all 34 other senators on Friday.
Marsh, an advocate for downsizing state government, said the state has about 5,500 fewer employees than in 2010 and said it could reduce the state workforce by probably another 3,000 through attrition.
But he said that would not resolve the long-term concerns of funding Medicaid, mental health, prisons and services for senior citizens.
The report estimated that casinos at the four greyhound tracks would create about 11,000 jobs.
Suman Majumdar, a senior consultant for AUM Outreach, said that would include jobs at the casinos and one adjoining hotel at each site.
The economic impact of the casinos was estimated at $800 million annually.
Updated at 5:34 p.m. to say casino games might provide revenue in 2016 if they are approved in a special election.