New Casino Bill on the way: What Georgia legislators and voters can learn from Massachusetts

January 23,2017

January 20, 2017 – An 180-page report commissioned by the Central Atlanta Progress (CAP) group and the Atlanta Downtown Improvement District (ADID) association entitled “Casino Gaming in Georgia,” is now available.

Georgia is one of the few remaining states without casino gambling, and “Georgia and its Metro Atlanta counties are becoming increasingly attractive to gaming interests wanting to gain a foothold into these untapped markets,” the report states. Neither of the two organizations have taken positions for or against casinos, according to A.J. Robinson, CAP/ADID President.

In last year’s session, a bill was filed that would have permitted four casinos in Georgia, in two areas of the state, including the Savannah-metro area. The bill would have put the question on the ballot to first change the Georgia Constitution to allow the licensing, and included language that the voters in the proposed counties where the casinos would be sited would also have to assent.

It’s a big issue, with enormous dollars on the line, both short-term in jobs, payroll taxes and licensing fees, and in the long-term in annual tax revenues and local property taxes, and a new bill is expected to be filed shortly by Rep. Ron Stephens.

The CAP/ADID Georgia casino impact research was conducted by Horwath HTL and HLT Advisory, Inc; Dr. Bruce Seaman, PHD, Georgia State University; Douglas M. Walker, PHD, Casinonomics Consulting, LLC; and Bleakly Advisory Group and Key Advisors.

The Atlanta business organization report states that the research conducted has six “Key Takeaways” which are:

Casino gaming could generate an additional source of state revenue, but it has its drawbacks
Casino revenue is primarily generated from locals, not tourists
Substitution effects likely exist at multiple levels but are complex and difficult to predict
Local communities will incur costs, so funding mechanisms must be in place to mitigate such impacts
Social impacts need to be mitigated for communities closest to casinos
Local communities must set and negotiate specific objectives before allowing a casino development

And, the SBJ has confirmed this week that the Winn casino and hotel company is now actively looking at Georgia, in addition to the MGM hotel/casino company, with discussions about a possible 1,000 room convention hotel to go next to a casino in downtown Atlanta. That’s a concern to many metro Atlanta hotel owners, according to tourism sources.

It has been estimated that Georgia’s statewide casino spending could be between $2.1 and $2.5 billion annually, based on the introduction of gaming in other states, but there is no other truly analogous casino to be researched due to the size of the Atlanta metro market versus where many other casinos are located. The Winn hotel and casino now underway in Everett, MA, near the Boston downtown, could have a similar impact to an Atlanta downtown casino, but it is not slated for completion until 2019.

At a 20% proposed tax rate (the rate in last year’s bill sponsored by Rep. Ron Stephens), Georgia could earn between $320 mil to $400 mil in gaming tax, according to supporters.

That tax rate, interestingly, is low compared to what other states who have recently approved new casinos, are receiving. Massachusetts is taxing what are termed the category 2 slots-parlor at 49% of gross gaming revenue (their new Plainville, MA slots casino), and will tax the new Winn Casino in Everett, MA. at a 25% tax rate. That facility is a full-service casino versus a slots-only casino.

Read the complete article at the link above.