Updated 2/4/16 at 5:06 p.m. to clarify statistics from the Georgia Lottery Corporation.
Photo by Jason Luong | The Signal
Another posse of Georgia State Reps. has rolled into town to try its hand at legalizing casino gambling in Georgia this legislative session.
If passed, Georgia House Bill 677 (HB 677) would allow casino gambling in Georgia under the oversight of the Georgia Lottery Corporation (GLC), according to the Georgia General Assembly.
The primary sponsor, State Rep. Ron Stephens, R-Savannah, said the minimal requirements to build these casinos may be up to $2 billion dollars and create over 10,000 jobs, “a huge economic impact for Georgia.”
“We’re hoping to recapture the lost revenue leaving Georgia going to Alabama, North Carolina and Florida,” he said.
The bill would also authorize six casino resort licenses across five Georgia areas — Atlanta, Savannah, Macon, Columbus and South Georgia, according to the Atlanta Journal-Constitution.
Chip Lake, political consultant and member of the Committee to Preserve HOPE Scholarships, said if HB 677 is passed and approved by the voters, more than $30 million per year would be channeled into higher education.
“We are supporting this piece of legislation in order to allow so many more people to take advantage of the HOPE,” he said. “And also, we want to preserve the HOPE Scholarship for future generations.”
One of the bill’s sponsors, State Rep. Stacey Evans, D-Smyrna, said revenue from casino gambling could yield more than $30 million to HOPE Scholarship funding.
“It depends on how much money is generated from casino gambling and what tax rate is charged to the casinos,” she said. “It will be higher than the 12 percent in the original bill draft.”
Lake also said these resorts, dubbed “destination casinos,” will be spread about the state to avoid oversaturating the region with gambling businesses.
“Destination casinos will be so limited in nature that each of the regions in the state [of Georgia] will only be allowed one, except Atlanta,” he said. “It’s the inverse of Las Vegas.”
HOPE Lost
Stephens said a way to “plug the hole” in the HOPE Scholarship will come in the form of parimutuel betting, or horse racing, which will generate over $15 million in funding.
“We were using our reserves to the point that funding for HOPE was zero,” he said.
In 1995, The Georgia Lottery raised over $500 million for education, and by 2015, the corporation had seen a 96 percent increase, transferring over $900 million into education, according to Kimberly Starks, Media Relations Manager for the Georgia Lottery Corporation.
However, the GLC has also seen nearly an 11 percent decrease in profit margins from about 36 percent in 1995, to less than 25 percent in 2015 due to the rise in popularity of ‘scratcher’ games over “draw” games like PowerBall, according to the House Study Committee on
the Preservation of the HOPE Scholarship Program Final Report.
According to HB 677, the bill would create a Casino Gambling Education Account used to fund the HOPE Scholarship, Georgia Pre-K programs and the Problem Gambling Fund to be held in the State Treasury.
Despite not being a HOPE scholar himself. Dan Nguyen, Georgia State pre-law major, said he thinks Georgia needs more scholarship funding to help more students receive an education,
“I do see the benefits of HOPE,” he said, “especially for those who are not in stable financial situations.”
The Georgia Lottery, by 2014, had generated over $940 million for the Lottery for Education account, according to GLC’s financial highlights.
But the HOPE Scholarship, which raised its grade qualifications in 2015, has not been entirely innocuous for all affected. Stephens said the HOPE was in danger of going broke, especially during the 2008 recession.
“We changed the HOPE plan about three years ago,” Stephens said. “But it wasn’t going up enough. Our best and brightest were staying home, our schools were full, and the demands were stripping our supply.”
Rob Lawry, Georgia State psychology major, benefits from the HOPE Scholarship. He said maintaining HOPE eligibility is “a tough process.”
“I had to withdraw from school for medical reasons, and I still have to prove I was meeting Satisfactory Academic Progress (SAP) when I had a 3.3,” he said. “I’m still on probation with them, trying to prove I’m still a good student.”
Stephens also said if the HOPE is fully funded again, the eligibility requirements will go back to students needing only a 3.0 GPA.
Roll of the Dice
Since the 1990s, 23 states have welcomed commercial casinos, according to the Institute of American Values (IAV) 2013 report.
HB 677, if passed, would also rename the Georgia Lottery Corporation (GLC) as the Georgia Lottery and Gaming Commission, which would manage all casino operations, and make recommendations to the Governor to treat problem gamblers, according to Georgia Legislation.
Stephens said 2 percent of gambling profits would go to organizations like Gambler’s Anonymous. He also said he thinks casino resorts would be placed near airports or interstates.
“93 million people come through the airport a year, and after they vote for it, ordinances would have to created on the local level,” he said.
Lawry is for casino gambling, but thinks downtown Atlanta would not be improved with the addition of a casino. In fact, he thinks criminal activity could actually increase. He said he thinks nearer to Atlanta’s I-285 perimeter would be a better place for it.
“We got enough wild shit happening in Downtown,” he said. “Put it in Buckhead with the yuppies and the people who have money.”
A 2004 study published in the Journal of Gambling Studies found, of 300 metro areas studied, the presence of casinos can lead to a lack of civic involvement and family stability nearby, according to the IAV report.
Lake said the closest example of a destination casino that might come to Georgia is currently in construction in Prince George’s County, MD. This gambling complex costs over $900 million to build, according to The Washington Post.
Snake Eyes
A 1996 study from the Journal of Law and Commerce claimed that 35 to 50 percent of casino revenue is derived from problem and pathological gamblers, according to the IAV report.
A Gambler’s Anonymous member, only identified as Steve, said having a casino in an area populated by compulsive gamblers is similar to having “a crack dealer on the corner next to addicts.”
“The temptation will be there, and if that person is not in recovery, they got no chance,” he said. “If that person is a compulsive gambler, it’s gonna take everything away from them.”
Sainabou Jallow, Georgia State biology major, is not an advocate of gambling, although she is glad the money is being used for education. But she thinks there could be other options to fund the HOPE, other than gambling or taxpayer money.
“People are going to complain if it comes out of taxpayer money, because not everyone wants to donate to education,” she said.
Georgia House Resolution 807 is a constitutional amendment that would authorize, operate, and regulate the possible casino resort license areas of operation in Georgia, and only six of these licenses can be active at any time in the state, according to the Georgia Legislation website.
Nguyen is for funding education with gambling profits and treating gambling addiction, yet he can see a problem with a casino in the heart of Atlanta.
“You can’t stop people from gambling, so we might as well fund college tuition [with it],” he said. “[A casino] Being in close proximity could prove a little detrimental to students receiving an education.”
Stephens is optimistic about the bill’s chances.
“If you’re for the HOPE Scholarship, you have to be for gambling,” he said. “They’re inextricably linked.”
Today’s article on the possible introduction of casino resorts, has some misleading information. Casino gambling does create problems for compulsive gamblers, but with only 6 casinos in the State, it will have a minimal impact compared to the State Lottery, with thousands of sales outlets, that disproportionately tax lower income residents.
It is outrageous to say that 35% to 50% of casino revenues come from problem gamblers. In fact casinos disproportionately attract higher income customers, unlike Lotteries.
To imply that 6 Georgia casinos would only provide $30 million in revenues for the HOPE Scholarships, means that a very small portion of the potential tax revenues is scheduled to go toward college tuition. My belief is that by limiting the number of casinos, and placing them around the State, the potential tax could easily be north of $500 million annually. In greater Baltimore, the largest of two casinos, Maryland Live, paid nearly $300 million in taxes to various State programs. And metro Atlanta has twice the population of metro Baltimore.
And when Representative Stephens mentions Georgian’s gambling in Alabama, Florida and North Carolina, he could also add Biloxi and Las Vegas. Atlanta’s Hartsfield has 40 flights a day just to Las Vegas, around 2 million available seats annually, from half a dozen carriers.
Plus the concerns about crime increasing, refer to any attraction that brings millions of new visitors, like Disney World brought to Orlando. And even though the FBI Crime stats may increase, they will primarily be in the non violent categories, and when visitors are averaged in, a residents chance of being a victim, will actually decline, as it did in Atlantic City.