Regional market saturation and casino-owner pressure to reduce tax rates would make revenue less than advocates' estimates, inflated to lure in revenue-hungry legislators. Average slot casino tax rates in gambling states is 22 percent, less than half the rates in recently proposed New Hampshire casino legislation. Tribal casino tax rates average 6 percent. The most recent Massachusetts casino proposal sets taxes at 27 percent. The NH Education Funding Commission (click here: compare scenarios 3 and 4) found that if Massachusetts were to legalize slots, New Hampshire slots revenue would decline by 52 percent. Former Ways & Means gambling study committee member Mike Marsh shows in this op-edit how Millennium has overstated likely state casino revenues by three times.

A new report by the Rockefeller Institute of Government examined gambling revenues in each of the 50 states over the period 1998-2009, finding that adding new forms of gambling have not provided states with a long-term budget fix because gambling revenues “do not keep pace with traditional tax revenues and government expenditures over time … [and] may add to, rather than ease, long-term budget imbalances.” The Institute found that FY 2009 casino, race track casino, and video slots revenue declined by 6.5 percent, when revenues from new racino openings in Pennsylvania and Indiana were not included. After speaking with his counterpart in Delaware, former NH Department of Revenue Commissioner Phil Blastos testified to the Gaming Options Study Committee (10/11/2005), casino revenues would "probably ... start high and go down. That's the experience in most other states."

Because the U.S. gambling market is super-saturated and because gambling is a declining revenue source, gambling dependent states are under constant pressure to expand into new forms of gambling in more locations. Industry promises of "limited" gambling are being proven false in state after state:

n         Revenue from Illinois’ nine casinos plummeted almost 24 percent, forcing the state to permit over 45,000 additional slot machines in bars, restaurants, and social clubs throughout the state.

n         Connecticut Governor M. Jodi Rell, facing sharp revenue declines from her state’s two tribal casinos, earlier this year proposed legalizing 1,000 keno slot machines in bars throughout the state.

n         The Pennsylvania legislature is about to legalize table games at its existing casinos and racinos, though backers of that state’s 2004 authorizing legislation promised table games would never be needed.

n         In Maine, Bangor’s Hollywood Slots management recently announced its desire to add table games, even though voters were promised that this would not be necessary when racinos were legalized in 2003.

 

 

The National Gambling Impact Study Commission found that casinos double gambling addiction within a 50 mile radius (click here: p28). Casinos at the four race tracks and one North Country location would create at least 3,000 additional gambling addicts among our neighbors, 20 percent of whom would attempt suicide. Increased addiction-related social and economic costs include divorce, domestic violence, child abuse, child death by abuse, rape, assault, suicide, drug abuse, psychiatric and personality disorders, physical illness, bankruptcy, work absenteeism and lost productivity, embezzlement, insurance fraud, arson, and increased police, civil justice, social services costs. Prevalence (click here) of these problems among pathological (addicted) gamblers compared to non-gamblers increases by up to several times: past year unemployment benefits by 3.3x, past-year welfare by 2.4x, bankruptcy filing by 4.6x, arrests by 7.2x, divorce by 2.9x, suicide (click here) by 5-10x, long-term illness by 2.0x, depression by 4.2x. These are among the reasons that New Hampshire's faith community is nearly unanimous in opposing casinos.

The Nova Scotia Gaming Foundation published a comprehensive literature review on the casino-suicide link, finding (page 27) that: estimates for attempted suicide range from 17% to 24% of pathological gamblers and that pathological gamblers have a suicide rate five to ten times higher than the general population and their spouses have suicide attempt rates three times higher than the general population.
Research has also shown that the presence of slot casinos degrades "social capital" in surrounding communities. Social capital is a quality of life index measuring prevailing levels of trust, civic orientation, volunteerism, group participation, charitable giving and service, and meeting needs of family and friends within a community.

Casino advocates never account for the not-so-hidden costs of gambling-addiction: white collar and violent crime, civil justice, reduced workplace productivity, bankruptcy, embezzlement, suicide, illness, and increased social welfare costs. These costs are 2 to 3 times the gambling revenue and will drive up mandatory spending in Corrections, DHHS, and other state agencies. Local law enforcement, highway, and school budgets usually rise after casino openings.

New Hampshire casino proposals often provide opportunity for host communities to vote on casino acceptance.  This approach leaves no say for communities that will bear most impact.  This Boston Globe article illustrates the huge cost impacts on schools and towns in the region surrounding the Connecticut tribal casinos.  Contrary to industry claims, most casino workers are paid low wages, necessitating increased budgets for subsidized housing and increased schools budgets for services such as English as a Second Language and subsidized meals. 

Gambling social and economic costs (click here) would be 2 to 3 times revenue for the typically-proposed four-track plus north country casino bill. The best published study to date estimates total national costs of gambling addiction at over $54 billion annually (click here), half the societal cost of drug abuse. As measured by these social and economic burdens, gambling taxes are the most costly form of revenue available to lawmakers. This is why our leading anti-tax organizations oppose casinos.

Gambling interests are proposing convenience (local customer) casinos, because the New Hampshire market is too small to justify the $1 billion plus investment required for Foxwoods-type destination-resort casinos. Because most casino patrons would live nearby (click here),, casinos would drain consumer spending away from existing New Hampshire businesses, such as restaurants, hospitality, entertainment and retailers.

Patrons do not leave casinos to visit nearby visitor amenities. Casinos maximize profit using subsidized rooms, meals and alcohol to hold patrons on site until they have lost as much money as possible. Here is a convenience casino owned by the Las Vegas company that is lobbying to bring race track casinos to New Hampshire. Casinos like this would sully New Hampshire's healthy, family-friendly and valuable brand image, crucial to our second largest industry, tourism. Says Ledyard, Connecticut's Mayor (click here), "There has been no economic development spin-off from the [Foxwoods] casino ... Gamblers have one thing in mid: get to the casino, win or lose their money, get in their cars, and go home." This is why members of the New Hampshire Lodging and Restaurant Association overwhelmingly oppose casinos.

At the recently proposed 48 percent tax rate, casino taxes would be the highest rate on any activity in our state, cannibalizing lower-taxed economic activity such as dining, retail, and entertainment ... in essence a massive, thinly concealed tax hike on the New Hampshire consumer and business economies. Slot casino taxes are also extraordinarily regressive. Problem and pathological gambling prevalence is ten times higher in low as in high income communities (Welte, p418). Gambling addiction is twice as high and effective casino tax rates are at least 2-4 times higher among lower income groups (sources).

There is no means to confine the impact of legalized gambling to adults. A Rutgers University study found that teens are twice as likely to be heavy gamblers if their parents gamble (Table 2.14). Teens are one-third more likely become pathological level 3 gamblers if their parents gamble (Table 3.5).

A University of Delaware study found that almost one-third of 8th and 11th graders in that casino state had gambled in the past year. Those Delaware teens gambling over the past month were two to three times more likely than non-gambling peers to smoke, binge drink, steal, or use illegal drugs. Student test scores drop. High school drop out rates increase. Slots are, literally, anti-education. The injury to children alone makes video slot casinos indefensible. Gambling addiction and, thereby, nearby casinos are linked to substantial increases in divorce (NORC p49), family violence, child physical abuse, childhood attempted suicide, and childhood depression. At least 10 percent of children of gambling addicts suffer physical abuse at the hands of the addict (NRC p159). These are among the reasons that the Children's Alliance and the state teachers union (NEA-NH) oppose casinos.

New Hampshire is ranked the safest state in the nation, Nevada the least. Here is the best peer-reviewed study using nationwide data showing the unambiguous link between casinos and increases in aggravated assault, rape, robbery, larceny, burglary and auto theft. Extrapolating the impact of four race track and one North Country casinos, New Hampshire would suffer an additional 5,800 robberies and thefts, 460 aggravated assaults, and 45 rapes. A federal Department of Justice study found that problem and pathological gamblers are 3-5 times as likely to be arrested. An independent study performed for New York State confirms the serious gambling-crime link. Here are some real-life examples of gambling-related crimes. For these reasons, our Attorney General, the Police Chiefs and the Sheriffs Association all strongly oppose legalized casinos.

Gambling promoters say that casino taxes are voluntary. The best research on the subject shows that about 60 percent (table 17) of casino revenue comes from problem and pathological gamblers who cannot stop themselves. Because they require no skill and are played rapidly, repetitively and in isolation, video slot machines are the most addictive form of gambling yet invented and provide 70-80 percent of the gross profits at most casinos. The Australian Government (Vol 1, Summary, page 21), in a comprehensive study of that nation’s extensive gambling industry, found that problem and addicted gamblers lose 19 times more per year than non-problem gamblers. 

Gambling addiction onset is over 3 times faster with slot machines compared with table games (Breen, table 1). This Breen and Zimmerman study (page 5) reports that 70 percent of Delaware gambling addicts seeking treatment identify slot machines as their primary gamblnig problem. This news story explains the science in lay terms about why slot machines are so addictive. Rather than a failure of self-will, gambling addiction is a legislative failure to balance costs and benefits. Locating casinos near where people live turns susceptible individuals into addicted gamblers.

Dr. Robert Breen, director of the Rhode Island Gambling Treatment Program, explains the greater addictiveness of slot machines on the basis of their play speed and repetitiveness: "Frequently, patients reported that they developed [problem gambling] rapidly and severely after beginning involvement with machines. This was true despite that, in many cases, they had gambled regularly on other forms of gambling for many years without problems … However, the addictive qualities of video gambling transcend mere speed and continuity. The use of virtual reel mapping in the design of such devices creates an illusion of near misses and misrepresents the true odds of winning."

While New Hampshire should increase treatment services for gambling addicts, even when available, such treatment services are used by only a small fraction of addicts are therefore not a substitute for preventing the problem by keeping predatory slot casinos out of our communities. This American Journal of Psychiatry study (page 299) found that -- even when such services are available -- only 7 percent of lifetime pathological gamblers sought or received treatment. In a literature review, Petry et al found that "only 8 percent of [Gamblers Anonymous] attendees achieve a year of abstinence." An analysis of a U.S. National Epidemiological Survey found that only 9.1 percent of gambling addicts used either GA or other treatment programs.

If casinos were legalized, gambling interests would soon dominate the legislature, as in most other casino states. A state-sanctioned gambling monopoly would give hundreds of millions of dollars to a handful of companies which would be dependent upon the legislature for tax rates, allowed number and location of machines and potential competitors. As in most other states, the gambling industry would quickly become the state's most powerful special interest. This is the primary reason why former Speaker of the House, Donna Sytek, opposes casinos. The state auditor found that the Pari-Mutuel Commission, which regulates most gambling, is stained by a multi-year pattern of self-dealing, evasion of legislative budget authority and sloppy recordkeeping (audit summary, full report). Pennsylvania is the current horror story of gambling industry influence. Common Cause found that the gambling industry spent over $17 million in campaign contributions and lobbying over the 7 years ending 2008, 3 state Supreme Court judges being top money recipients, and most industry money not being reported. Concerns include dead-of-night, no hearing passage of the law legalizing casinos, and three highly controvserial Supreme Court rulings for the industry and against citizens. 

Under federal law, legalization of even one slot machine would require the state to allow unregulated casinos owned by recognized tribes on historic tribal lands or on land subsequently purchased by the tribe. While there is as yet no recognized tribe in New Hampshire, over 200 tribes in other states have applications pending before the federal Bureau of Indian Affairs. These applications are often backed by gambling interests and clouded by charges of massive political corruption. Gambling interests fund tribal recognition once slots are legalized. There is no legal means to limit gambling to race tracks or state-owned casinos.

This new study shows that most electronic slot machines worldwide purposefully use 1/20th second, mid-play flashes of winning combinations, virtually-mapped and unbalanced reels to generate frequent near-misses, tricking gamblers into thinking that win odds are far higher than reality. These techniques and use of sound, lights and play speed are carefully manipulated to maximize addiction and revenue. Many slot machines stop mid-play for 1/20th of a second on a win, too short for conscious perception, long enough to subliminally trick the customers into thinking they are winners. Here is a video tutorial showing how slot machines use over-weighted of near misses to trick gamblers into thinking their odds are better than they are. Here is a video and written testimony of MIT's Dr. Natasha Schull before the Massachusets legislature on video machine design. Here is a report on a Canadian study showing that slots are designed to deceive players into thinking they are winning 2 to 5 times more than in reality. Here is a 2009 study published in the journal, Neuron, showing the brain science explaining how near-misses promote addiction.