Short-Sighted
by Andy Holtmann
Short-Sighted
Mississippi lawmakers’ decision to exclude gaming from state tourism tax incentives is indecorous
As the Gulf Coast’s gaming industry continues to rebuild from the ravages of Hurricane Katrina, an issue many casino operators and officials alike still need to resolve are the numerous “misconceptions” the general public has about the current state of casino operations in the Mississippi. In this issue’s cover story, those that have been active in the market’s gaming industry attest that it’s been somewhat of a challenge to convince the public en masse that the Gulf Coast is open for business. Even though the progress made in the past year-and-a-half has been immense—10 casinos are now open, creating a $1 billion market, not counting the Hard Rock slated to open this summer—many people still believe Mississippi’s Gulf Coast is nothing more than rubble and broken dreams. It’s a misconception that has made attracting new visitors from more remote locations a little harder than initially anticipated.
Yet there’s another, perhaps more dangerous misconception—that the market’s gaming industry is all fixed. That, while residents, businesses, infrastructure improvements, etc. continue to suffer, casinos are raking in the dough and profiting from communities in distress. Of course, nothing could be further from the truth. It would have been very easy to cut and run after Hurricane Katrina. There are plenty of other gaming markets in which casinos can operate in the United States. But rather than pull out, the gaming industry chose to stay, and both large casino corporations and small, privately held operations immediately started rebuilding. In the long-run, sure, these casinos will profit from that decision. But the commitment that was made shortly after the storm was to put people back to work; to give residents who had lost it all a reason to stay and help their neighbors; to give communities a fighting chance at survival; and to step up to the plate and get tax revenue streams that the state and local governments were immensely dependent on flowing again. Let’s face it; the Mississippi Gulf Coast was economically depressed before casinos in the early 1990s, and without casinos’ rebuilding efforts today, these communities would truly remain in the state of ruin that they were after the storm.
So why is gaming getting the short end of the stick? Thanks to fervor from anti-gaming forces, the Mississippi Legislature has excluded any operation associated with casino gambling from enjoying tax breaks under a new state tourism bill. House Bill 1142 provides incentives for private investment in tourism of up to 30 percent of the investment over a 10-year period at a minimum investment level at $10 million statewide. Anti-gaming pressure from the Senate, however, ultimately caused the bill to go back to the House, where it was amended to exclude gaming companies from taking part in the incentive, regardless of the project. Though some Senate and House members preferred to provide the incentives to all companies, the revised bill—sans gaming—was passed in March.
To me, that’s a slap in the face of the one industry that has done the most for economic relief and recovery for the state. Will casinos’ omission from the bill affect any of the ongoing projects or commitments from the gaming industry on the Gulf Coast? Not likely. But it speaks volumes to the disconnect that can occur between gaming and state governments. As we approach the two year anniversary of Katrina this summer, rebuilding efforts by the gaming industry will have created about 15,000 jobs and infused billions of dollars of investment in the Gulf Coast. The sooner state officials see the real value of gaming instead of thinking of casinos as “necessary evils,” the better.
HHHHH
Speaking of anniversaries, I want to congratulate Bally Technologies on 75 years of innovation and success in the gaming industry. The company has designated 2007 as the “Year of Bally,” is holding events honoring this milestone throughout the year. Ascend Media Gaming Group, in cooperation with Bally Technologies, has produced a standalone 75th anniversary commemorative publication, highlighting the vital role Bally has played in the gaming industry. The issue will be landing in your mailbox soon, so please keep an eye out for it.
