Issue Position: Expanded Gaming in New Hampshire

Issue Position

There are solid fiscal and public policy reasons to oppose expanded gaming.

Speech opposing expanded gaming prepared by Dennis Malloy for NH House May 2014.

My wife and I moved here 14 years ago from Iowa where we saw firsthand how quickly expanded gaming affected the management of Iowa's budgeting, governing and legislative process. Expanded gaming in Iowa was vigorously debated and once approved, 18 casinos were built over the next several years.

Gaming consultants describe two types of casinos: The tourist model employed by Las Vegas and the convenience model found in states like Iowa. They also write that the convenience model cannibalizes the native population because revenue benefits come at the expense of covering social costs, and businesses within a 50 mile radius of the convenience casino take a revenue hit. Many of these convenience casinos are sitting alone on the outskirts of town, with their flashing lights surrounded by vast, empty parking lots and little to no new business development nearby.

Gaming dollars have been used to fund new or expanded state programs, but in past economic downturns Iowa turned to gambling tax revenue to just balance its budget. When gaming revenue falls short of projections, states add more games and more locations to keep programs going and a February report to Iowa gaming officials said that new casinos will only "cannibalize" the existing gaming business. Every state that has opened the door to gaming has experienced this cycle and some Iowa casinos are now asking for tax breaks because they aren't as profitable as originally planned.

It's now reported that gamers are making fewer trips to the area's casinos, but spending a somewhat larger amount on a per trip basis. Over the last couple of years Iowa's adult population increased but casino "admissions" as they call it, were down. Revenue did grow in 2013 after falling due to the recent recession, stress on personal incomes and high gas prices.

Over half of a local casino's revenue comes from problem and pathological gamblers, As well many casinos, including many in Iowa shifted their marketing focus toward their higher level, most profitable customers with less focus on the casual player. Now the most vulnerable and addicted gamblers are footing the bill and this addiction will become even more important as the pressure for increased revenue grows. This is an important point because experts say that video slot machines are the most addictive form of gambling yet devised and we are debating placing thousands of them here. To extract even more money from regular patrons one of the Iowa casinos offered discounts on prescription drugs.

Expanded gaming has changed the character of the election process and the support of candidates. This decision will affect us today and live on with us for decades and no will to suspend this as gaming interests seep deeper into our political and governmental processes. Iowa found that adding gaming revenue to the state budget put extraordinary pressure on state government officials and the processes involved in making decisions about the state, including how to manage the growth of state government.

From a jobs standpoint, there is a short term benefit for those fortunate enough to land a job during the initial construction phase, but after that, the remaining jobs are primarily in food services and janitorial duties, especially if the location in question is a slot machine or convenience casino. The bulk of the jobs will be mostly low-wage, or tip-dependent and therefore below the minimum wage.

I've been concerned about proliferation ever since these bills found their way to us, and I rose today primarily because of what I consider this to be the most onerous change of all. A month ago we were talking about one high-end destination casino. The proliferation has started and we've not even begun.

In my view, there will be a few more dollars available for us to spend as a state, but other personal and business wealth will be sent out of state, government will expand, more addicted gamblers will be created and local business will take a hit.

These are a few of the reasons why I'm so concerned about approving this irrevocable step, and others have made similar arguments. I believe that expanded gaming would change New Hampshire at many levels, and would not be a sustainable or New Hampshire friendly solution. I urge you to support the Ways and Means Committee and the motion of Inexpedient to Legislate by pushing the GREEN button.

Representative Dennis Malloy

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