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New Hampshire Ponders Video Gambling

February 10, 2008

Supporters say it could generate hundreds of millions of dollars annually to the state and $2 million to the town of Belmont.

But opponents counter that a bill to expand gambling by permitting video slot machines at New Hampshire's four race tracks including The Lodge at Belmont — would only increase a host of social problems while siphoning money out of local economies.

The diametrically-opposed sides come together on Feb. 19 when the NH Senate's Ways and Means Committee considers Senate Bill 330.

Sponsored by Sen. Lou D'Allesandro, D-Manchester, SB330 would allow The Lodge at Belmont, Hinsdale Greyhound Park, Seabrook Greyhound Park and a "grand hotel" in the North Country to each have 1,000 slot machines while Rockingham Park would have 3,000.

Each of those 7,000 machines was estimated to bring in $296 a day, which, times 365 days, would result in a gross revenue of $756,280,000 per year.

Less $109,662,000 in operational costs, the total net machine income would be $646,618,000 of which the General Fund would receive 42 percent or, $271,579,560. The Department of Resources & Economic Development would get 2 percent of the net for tourism promotion and the Pari-Mutuel Commission would get 4 percent, three percent of which would go to the counties in which the race tracks are located.

The track's home towns would each get 2 percent of the net slot machine income, which for Belmont would translate to $2,160,800. Currently, Belmont receives between $300-$400 for each day that The Lodge at Belmont is open for wagering on live greyhound racing or simulcasts from other tracks, in addition to a property tax that it collects from the owner, Torguson Gaming Group of Biloxi, MS.

Gov. John Lynch has said he does not support expanded gambling in 2008 — although Rick Newman, the lobbyist for The Lodge at Belmont notes that Lynch wasn't unequivocal, nor did the governor say anything about 2009 — and the Granite State Coalition Against Expanded Gambling, according to Executive Committee Chair Jim Rubens, will again bring testimony and a group of like-minded, bipartisan supporters that include the Senate Majority Whip Martha Fuller Clark, D-Portsmouth.

The vice chairman of the Ways and Means Committee, D'Allesandro on Thursday said SB330 is "an economic package first" which would create jobs and produce "a significant revenue stream without an additional tax."

When asked, the senator said he was "very familiar with all the arguments against expanded gambling," but maintained that what he proposed was based on the state of Delaware's "racino" model that combined a live-racing track with a casino.
In New Hampshire, "we have four tracks and they would be good venues to place the video lottery machines and we can do it in a safe and secure environment."

Also, the timing is right, he said, noting that Massachusetts Gov. Deval Patrick is looking to expand gambling in the Bay State.

"You have to keep thinking outside of the box all the time," said D'Allesandro. "People are crying out for more revenue and don't want to be taxed," he said.

D'Allesandro acknowledged that the anti-gambling forces have been "very vocal" in the past when expanded gambling was considered by the Legislature but he thinks the discussion this time will be different because of what is happening in Massachusetts and at casinos in Maine and Rhode Island which are also growing.

Rubens doesn't think slot machines will save New Hampshire.

"Putting a slot casino in Belmont would degrade the quality of life in the region, not just in the host community but in the 15 to 50 miles around the track. Most of the people who will gamble will be people who live in the area so the social and economic costs of gambling addiction" will be borne locally, said Rubens.

Those costs said, Rubens added, include an increase in crime and the resultant need to spend more money on policing, prosecution and incarceration.

Even with slot machines, The Lodge at Belmont would at best be a "convenience casino" that served a very local clientele, said Rubens, in contrast to a "destination casino" like those in Las Vegas that by offering world-class food and entertainment, on top of the gaming, is truly able to attract a large number and broad range of patrons.

With a mega-hotel and proximity to an international airport, a "destination casino" costs between $1 billion and $2 billion to build and no one is currently proposing such a facility for New Hampshire, said Rubens, even though a potential buyer has said they would invest $500 million into Rockingham Park.

With a "convenience casino," "you'll be taking funds from existing consumer disposable income and throwing it down the throat of a slot machine and to a greater extent than a chain restaurant or theater, the money will get sucked out of the area," said Rubens.

December revenues at casinos in Atlantic City and Connecticut were down about 10 percent, said Rubens, "and that's just not the economy. It's primarily caused by market saturation. If you build budgets around slot machine revenue, you build budgets around a saturated market. There is now one slot machine per 390 Americans. That's a lot of slot machines and the more you put in the more you're carving up the market."