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Georgia casinos are under consideration, but new study raises concerns

February 22,2017

Source: Eden Getachew, The Signal

For the second year in a row, Georgia legislators are introducing a bill to legalize casino gaming in Georgia, but a recent study raises concerns about its potential effects.

The bill would allow for the construction of two casinos, one in Atlanta and a second in another Georgia city, with a required $2 billion investment for an Atlanta casino. The measure would also enact a twenty percent state tax on the casino’s earnings. Fifty percent of that revenue would be allocated for the HOPE scholarship, 30 percent would fund a needs-based scholarship and, in a recent change, 20 percent would help fund the state’s rural healthcare needs.

Casino gaming is currently illegal in Georgia, but legalizing it as a source of funding for the state’s college scholarships has been under discussion for nearly two years. Casino legislation failed to gain support in the General Assembly last year, and this year’s bill faced similar opposition during a Senate Regulated Industries committee on Feb. 9.

Sen. Brandon Beach, a supporter of the legislation, said the bill would create thousands of jobs and won’t use public funds.

“This is definitely a job creating bill,” Beach told the committee, according to 11 Alive. “The other thing is there will be no public money, no tax incentives. This is all private dollars.”

Central Atlanta Progress (CAP) released a study last month titled Casino Gaming in Georgia which compared Atlanta to similar U.S. cities with casinos – Pittsburgh, Detroit and New Orleans – to estimate the impact of casino gaming at the state and local levels. The independent, year-long study found that although casinos can serve as an additional source of state revenue, there are a few drawbacks.

Adding a casino to the metro area is not likely to increase tourism, as most of casino revenue is generated from locals, not tourists. Although the money Georgia residents spend at casinos would contribute to state funds, other areas where they would have spent their money prior to the existence of a casino, lose revenue. This effect is likely to take place at various levels.

The study recommended that funding mechanisms be put in place to mitigate the costs social impacts, including increased crime, drug use, problem gambling and sex trafficking, that local communities may incur. It also recommends that those communities set specific objectives before allowing a developer to build a casino in the area.

At a town hall meeting last month, CAP Project Manager of Economic Development said the city must consider their “compelling reason” for opening a casino in the area and determine whether or not it’s worth the pros and cons listed in the study.

CAP President A.J. Robinson said the organization is officially neutral on the casino bill and that based on their study, CAP has “concerns that the size and scope of a two billion dollar casino would be problematic for downtown.

“First off, we don’t have an ideal location,” Robinson said. “Second, the additional elements planned, a 1,000 room hotel and 3,500 entertainment facility, could adversely affect other venues in Downtown Atlanta.”

Robinson also mentioned that because the city in which the casinos would be located would not receive any of the tax money the casino brings in, the city will have no means to combat arising social issues.

Read the complete article at the link above.