Officials discuss growing dependence on gambling

Michael Mell

Thursday, Sept. 4, 2003 | 9:21 a.m.

PROVIDENCE, R.I. -- For Rhode Island and many other states, there's no turning back from legalized gambling.

In states that have so far resisted gambling's lure, worsening budget woes only increase the debate.

Legislators, regulators and gaming interests from around the country will meet in Newport this weekend to discuss the myriad issues surrounding legalized gambling. They include tribal-state relations, the growth of video-lottery terminals, casino legislation and federal efforts to minimize the spread of Internet gambling.

"The state of gambling three years ago and today are just not that close," said Florida state Sen. Steve Geller, president of the National Council of Legislators from Gaming States. "Budget crises have dramatically altered what in many cases have been long-standing relationships" between gambling interests and states.

Rhode Island could serve as a case study for the eight-year-old council, which has members from 12 states.

In 1992 gambling money made up just 1.4 percent of Rhode Island's general budget and was the 13th largest source of revenue. This fiscal year, the budget counts on $302 million in gaming revenue -- nearly 11 percent of general revenue.

The state this year responded to declining tax collections by increasing its share of the profits from its two video-lottery-terminal operators. Lawmakers, meanwhile, wrestled with legislation that would ask voters whether they want to allow a casino in Rhode Island.

In Maine, voters on Nov. 4 will decide whether to allow Indians to operate a gambling casino.

Gambling revenue has helped Rhode Island avert deep cuts in government services, though some worry the state may be too reliant on gambling.

"Gambling is the third largest revenue source and can be significantly affected by actions in other states," said Gary Sasse, executive director of the Rhode Island Public Expenditure Council. "But it's difficult to conceive of a state budget in the future without gambling revenues."

Rhode Island state Sen. Stephen Alves, chairman of the Senate Finance Committee, expects the next General Assembly to approve a measure that would ask voters whether they want a casino in the state. The bill, a version of which passed the House this year, would also set up a state gaming board.

Alves, a West Warwick Democrat who supports a casino in his community, will attend the conference. He'll hear from speakers for and against legalized gambling.

Tom Grey, executive director of the Illinois-based National Coalition Against Legalized Gambling, will argue "the bloom is off the rose" on gaming.

Seventeen of 19 states that this year considered adding slot or video lottery machines at race tracks opposed the proposals or took no action, he said. Alson with Maine, Colorado will put the question to voters later this year.

Proponents say so much interest shows states are increasingly turning to gambling.

But Grey argued gambling interests are encountering more resistance.

"They have been faced with having to defend their product, which makes it not as easy to push," he said.

Council members expect to vote on a list of things lawmakers should consider when negotiating gaming compacts with Indian tribes. There are 217 tribes running 342 gaming operations in 28 states, according to the council.

Geller, a Democrat, said other topics for the three-day conference, which begins Friday, include concern over increasing state taxes on gaming operations.

Lotteries will also be discussed, including state efforts to cut advertising costs.

"The lottery is a business," Geller said. "When you stop advertising, sales go down."