Every state government, it seems these days, wants to legalize or expand gaming. If they don’t already have gaming, they want it. Kentucky horseracing interests want slots to save their industry. Massachusetts is seeking a combination of resort casinos and racinos. New Hampshire wants racetrack slots and a couple of smaller casinos up north. Voters in Maryland and Ohio finally crossed the Rubicon, though gaming in each of those states has yet to commence operations.
And if they already have gaming, they want more of it. Not content with adding sports betting to its three racinos, Delaware is in the process of implementing live table games and is considering additional casino locations. Florida keeps wrestling with omnibus legislation to satisfy both the tribal and pari-mutuel gaming interests. Iowa, not content with 17 casinos, is assessing the feasibility of adding four more. Even Pennsylvania legalized live table games barely three years after opening its first “slots-only” casinos.
And some states that do not yet have gaming already want more of it. Maryland is considering the addition of live table games to its slots-only casinos, none of which have opened. Ohio is looking to revive the idea of video lottery terminals at racetracks even before the first of its four full-service casinos opens.
Obviously, the pace of expansion is not sustainable; eventually, certain markets or jurisdictions will reach the saturation point.
The overarching theme in this budget-bridging-driven gaming-expansion frenzy is revenue generation. Thus, the key question from legislators seems to be some variation of “How fast can we turn on the slot machines?” Indeed, it is a critical question as budget analysts try to forecast the coming fiscal years.
I submit, however, that the more pressing question should be, “How well can we regulate gaming?”
Rapid implementation of gaming operations and quality regulation are not mutually exclusive, especially with the wealth of templates available for guidance - if not outright duplication - from other states with proven track records of solid regulation. Further, there are hundreds of experienced, talented regulators across the country who are willing to relocate for higher-paying positions.
Still, states want to do it their way - whether to comply with their own laws (Kansas is the notable example; the state must be the owner of the casinos) or because they truly believe they can do it better - or because, in the words of Larry the Cable Guy, they just want to “git ’er done”.
In many states, the legalization of gaming is a question of when, not if. One particular state recognized this and began its regulatory preparation efforts well in advance, and for that I applaud the Commonwealth of Massachusetts. Attorney General Martha Coakley, recognizing the inevitable, and without taking a position on the pending gaming legislation, has told state lawmakers that more stringent rules are needed to combat money laundering and organized crime before they legalize gaming. Coakley made it clear that stronger laws were needed in any event, but that the specter of gaming makes legislative action all the more necessary - and more urgent.
“Based on historical experience in other states, it would be irresponsible to bring gaming facilities to Massachusetts unless we have the proper regulatory framework and law enforcement structures and tools already in place, even before some of the debate takes place,” she testified before the Massachusetts Senate last July. “We are all familiar with the extensive history of criminal prosecutions in other states - at the municipal, state and federal level - of gaming facility operators, employees and public officials alike.”
Coakley testified again this February, arguing that the state needed stronger laws in preparation for gaming, notably to combat money laundering and organized crime. “It is critical that we update our laws so that we can effectively address the types of financial crimes and corruption that are often associated with gaming,” she said.
We can disagree with her characterization of “often associated,” but the point is that Coakley is being pro-active.
It is this type of forward-thinking that can allow gaming to be legalized both expeditiously and with the utmost integrity.