Tuesday, April 16, 2013

In Minnesota the Reliance on Gambling Revenues to Fund a Football Stadium Is a Disaster

So Maybe the State Will Cut Education, Transportation or Aid to the Needy to Make Up the Difference

This Forum likes to pick on Minnesota, not because the people there aren’t nice and friendly, they are, but because they seem idiotic in their fiscal policy (and they keep sending Michele Bachmann to Congress, but that’s for another time.)  Minnesota Republicans shut down the state government briefly in 2011 rather than raise taxes to fund needed programs.  Then the state decided it had hundreds of millions to give to the NFL Vikings for a new stadium.  That hasn’t worked out well.

The state decided it could painlessly raise the money by approving new gambling devices and games.  The money raised would be $35 million a year, or maybe not.

Those estimates became the foundation for the state Department of Revenue’s projection that the new games would rake in $35 million for stadium funding by the end of this year.
In November, that figure was sliced to $17 million. In February, it was slashed to $1.7 million.

So what was the source of ‘those estimates’?  Oh, the industry that makes the devices, the industry that would benefit from the program, they provided the estimates.

The botched projections showing that electronic pulltab sales would explode in Minnesota and immediately start paying for a new Minnesota Vikings stadium were based largely on estimates made by gambling businesses with a vested interest in the new but untested form of charitable gaming, the Star Tribune has found.

Sales estimates were based on different kinds of gambling devices played in other states, made by national gambling equipment managers and vendors, according to e-mails obtained by the Star Tribune. Express Games MN, the first e-game vendor approved by the Minnesota Gambling Control Board, reviewed and analyzed the sales estimates that were part of the final stadium legislation.

Charities selling the games had little input into the projections, according to e-mails and interviews with key players in the stadium debate. The e-mails also reveal the fine line walked by the board between being a regulator and an advocate for the new games, despite no track record with consumers.

Now how did all this happen?  Well the Governor, a wealthy Democrat wanted a new stadium.  Republicans wanted no increase in taxes.  The solution, just increase gambling, increase social problems of those who ruin their live gambling and use the money for a football stadium with seats so expensive the local population cannot afford to attend.  But like all corrupt analysis, reality ultimately sets in.

So what’s Plan B?  How does the state replace the lost revenue?  Well there cannot be any tax increase, so how about all that money that is wasted on education, roads and public safety. Or, turn things over to the Republicans who will just shut down state government.  That will save a ton of money that can then be used to build a football stadium.

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