Final gaming report offers new numbers, same conclusions
The final version of the Spectrum Gaming report is out and, while the numbers have been revised and the explanations made clearer, the conclusion remains the same: Florida's economy is so big that the expansion into casinos would have a little overall impact on the state.
The report, produced by the New Jersey-based company, analyzed 12 gaming scenarios provided by the Florida Legislature in anticipation of an attempt by lawmakers to rewrite the existing law. The Florida Senate Gaming Committee, for example, will conduct the second of four hearings on the issue, in Lakeland tomorrow afternoon.
It offers many insights for policymakers, including Gov. Rick Scott, who will be in charge of renegotiating the gaming compact with the Seminole Tribe of Florida, if he choses to start the talks next year, before the portion of the company regulating table games expires in 2015.
Spectrum notes, for example, that allowing the tribe to continue to have exclusive operation of table games in Florida "could widen the revenue gap between the Seminole casinos and the pari-mutuel casinos, creating deterioration of operating performance for the pari-mutuels."
Here are some of the report's other conclusions:
* Legislators own this problem: "Intentionally or not, the policies established by lawmakers – or the lack thereof – play a critical role in the evolution and expansion of gaming....The industry rarely shrinks, and quite often, expands as a result of expansion."
* Gaming will continue to expand: "The combination of consumer acceptance, technological advances and government desire for revenue will continue to cause further gaming expansion...Expansion comes at a cost, both internally to the industry and externally to society. Expansion runs the risk of cannibalizing certain types of gambling – notably the pari-mutuel industry, which has long been in decline both nationally and in Florida – and it will sharpen the debate about how much is too much."
* Internet gambling poses huge threats to the status quo: "The expanding global industry generates an estimated $34 billion in revenues last year." If Congress legalizes Internet gambling, Florida would become the third largest market with $786 million in activity.
* Casinos will increase competition: "While it is difficult to determine with any level of precision which businesses will win and which will lose in such competitive battles, there is one over-arching certainty with respect to substitution, and that holds true for tourism in general, as well as for gaming: The dollar-for-dollar substitution with local businesses will be less pronounced and less impactful if new businesses – be they casinos or other attractions – help attract visitors and dollars from outside Florida."
* Casinos are no different than expanding any other business: "Based on our evaluation of the data and our projections, our conclusion is that casinos play the same role that other businesses do in a local economy. Since they rely on mutually beneficial voluntary transactions with consumers, both parties to the transaction benefit (i.e., the casino makes a profit, and casino patrons enjoy casino entertainment), and this activity is the foundation to economic development. In this sense, casinos can play as important role in the development of a local economy as any other firm. To their advantage, of course, is their ability to attract tourists who might not otherwise visit a region. Of course, there are also potential negative consequences to expanding legalized gambling in Florida..."