New study outlines economic impact of casino gambling in Arkansas
by October 5, 2018 9:21 am 1,671 views
In May, the U.S. Supreme Court overturned a federal law banning sports betting in most states. Theruling allows states to create their own legislation allowing sports betting in different forms. Arkansas statute forbids sports betting, although Arkansas legislators are now able to propose legislation to change that. (photo courtesy Wikimedia Commons/Baishampayah Ghose)
A new study from the University of Arkansas at Little Rock’s Arkansas Economic Development Institute (AEDI) says the impact of casino gambling in Arkansas would be dramatic.
The study found that the state could add more than 6,000 new jobs if Issue 4, a proposed constitutional amendment that would allow casino gambling, is passed next month. About 3,000 would be directly created in the gaming industry and another 3,000 would be created in sectors tied to the industry. It could mean $5.8 billion in GDP growth during the next 10 years, the study concluded.
The report, which you can view here, was commissioned by Driving Arkansas Forward, a pro-gaming organization. The proposed constitutional amendment authorizes one casino in Jefferson County, one in Pope County and grants full casino licenses to Oaklawn Racing & Gaming in Hot Springs and Southland Park Gaming & Racing in West Memphis.
“Voting ‘yes’ on Issue 4 means Arkansas can keep its money, its jobs and its tax revenue in Arkansas rather than sending money to surrounding states, and it means Arkansas’s economy will reap benefits even more far-reaching than many of the industrial super-projects we recruit to the state with public money,” said Nate Steel, counsel for Driving Arkansas Forward. “These privately financed casino resorts will employ Arkansas residents, pay Arkansas taxes and generate billions of dollars of economic growth for Arkansas.”
Tax revenues generated by the casinos would be distributed to the state’s general revenue fund, to cities and counties in which the casinos are located, and to the Arkansas Racing Commission for purses for horse and dog races.
The measure spells out how tax revenue will be collected and distributed. 55% of net casino gaming receipts will be paid to the Arkansas General Revenue Fund, 17.5% to the Arkansas Racing Commission for horse and greyhound racing purses, 8% to the county where a casino is located and 19.5% to the city or town where a casino is located.
The study contemplated two scenarios, one in which casino revenues remained somewhat static and neither Oaklawn or Southland expanded gaming beyond electronic games of skill. The more likely, but still conservative, scenario forecasted that Oaklawn and Southland would expand to offer full casino gaming and gaming receipts would increase based on historical trends.
“What this study represents is a thorough investigation of the likely impact of Issue 4 on the state’s economy,” AEDI chief economist Michael Pakko said. “We applied a dynamic regional economic model to projections of casino revenues, growth and construction activity to investigate both the direct and indirect effects of expanding the gaming sector in Arkansas. Not surprisingly, when you have an economic activity that is prohibited within the state but is available in nearby states, bringing that activity home has the effect of raising total income, spending and employment within Arkansas.”
Issue 4 establishes a selection process for casinos in Jefferson and Pope counties, and it recognizes the historical benefit and impact of iconic Arkansas attractions Oaklawn and Southland. Arkansans flock to other states for gaming purposes, according to the study. The Mississippi Gaming Commission reported 1.149 million visits from Arkansas residents last year alone.
Early voting starts Oct. 22. Election Day is Nov. 6.