State lottery board study: Three casinos could bring nearly $1 billion by 2014

Three casinos in metro Atlanta, Savannah and Jekyll Island, equipped with 10,000 video lottery terminals, could generate nearly $1 billion a year for the state as quickly as 2014, according to a daring, 84-page report requested and received by the Georgia Lottery Corporation.

It may be the first time a state entity has, in an official paper, broached the possibility of establishing state-licensed gambling houses in Georgia.

The $91,000 study was quietly handed to Gov. Nathan Deal last week. Just returned from a trip to China, the governor has yet to review it, a spokesman said Wednesday.

Which means you can read it before the governor does by clicking here. (Journalistic compadres: You, too, can download the report. But please credit this newspaper.)

A casino industry representative browses through rows of new slot machines on display at the industry's G2E conference earlier this month in Las Vegas. AP/Julie Jacobson

A casino industry representative browses through rows of new slot machines on display at the industry's G2E conference earlier this month in Las Vegas. AP/Julie Jacobson

In metro Atlanta, the report gauged the potential productivity of six locations in downtown Atlanta, Cobb, Clayton, DeKalb counties and at Lake Lanier. Savannah and Jekyll Island were the only coastal locations examined.

“Georgia, in particular the Atlanta metropolitan area, would be viewed by the gaming industry as one of the most prized opportunities in North America, largely because it has one of the largest, most affluent, untapped markets, with excellent air and highway access,” the study said.

Declines in revenues over the last two years, plus increased demand, this year forced state lawmakers to cut the reach of lottery-funded HOPE scholarships. But don’t look for casinos to be your kid’s ticket to a free ride through college. Not anytime soon.

There is some legal debate over whether the Georgia Lottery Corporation could take the state down Casino Road on its own authority. But Jimmy Braswell of Macon, chairman of the lottery commission, said no such move is anticipated.

“Our position has always been – whether we could or couldn’t, really doesn’t matter. It’s not something the Lottery is going to step out and do on its own,” Braswell said. “We’ve always viewed this type of concept as a public policy decision. And it’s not something that a seven-member appointed board should unilaterally decide to do.”

“It would have to be something that the governor and the Legislature would have to lead on,” he said.

And that leadership isn’t likely to be immediately found at the top levels of the state Capitol. This year’s legislation to allow communities to repeal a statewide ban on the Sunday retailing of alcohol already has injected the GOP’s conservative Christian base with a heavy dose of insecurity.

Despite his immediate silence, the governor hasn’t looked favorably on an expansion of gambling in Georgia. Neither has Lt. Gov. Casey Cagle. Earlier this year, House Speaker David Ralston raised questions about current legislation to permit pari-mutuel betting in Georgia, pointing out that most horse tracks now require the presence of slot machines to guarantee profitability.

And he didn’t want slot machines.

So why do such a study? Enough talk was going around, said Braswell, that he wanted some hard facts in hand. “I wanted somebody to independently take a look at this and quantify this concept — so that I would have a comfort level, rather than hearing everything third hand,” the commission chairman said.

The report was conducted by the Spectrum Gaming Group of New Jersey, and examined 20 government agencies that oversee gaming operations, in the U.S. and abroad. Among the findings:

– Perhaps one in five Georgians would be willing to walk into a casino. The average gambler would spend between $500 and $800 a year.

– Casinos would create a “different” experience than buying a lottery ticket, and thus would attract a wealthier clientele – and more money. “Visiting a casino that offers [video lottery terminals] requires a commitment of both time and money,” the report said. “This effectively means that VLTs offer multiple revenue streams that simply do not exist with traditional lottery products.” In other words, the construction of hotels and associated entertainment venues would mean increased tax revenue that could be used for more than HOPE scholarships.

– An immediate boon to the state could come through the auctioning of a handful of licenses to private casino companies.

– The Georgia Lottery Corporation would need to evolve into an agency that actively regulated casino operations. The report suggested a firm whip hand from the outset. “This allows the state to peel away or revise regulations over time, as regulators gain confidence in the operations and the integrity of the operators,” the study recommended.

– Singapore was cited as a potential model for the rules that govern casinos. Family members can require gambling houses to bar relatives who are spending grocery money. And no ATMs are allowed within casino walls.

– The report pointedly warned that casinos could aggravate political corruption.

Braswell said he also wanted the casino study in order to measure the number of “gray machines” in Georgia – computer terminals and slot machines in convenience stores and Internet cafes across the state. The illegal operations compete with the state lottery, and are thus a drain on its revenue.

Citing law enforcement officials around the state, the report estimated that 10,000 illegal slot machines now operate in Georgia. The same number of machines that, under state-licensed casinos, could bring $933 million a year.

But this study is about more than a lottery board chairman’s curiosity. What will startle lawmakers in the state Capitol is the leap it takes, far beyond past discussions of gambling in Georgia.

Legislators went pale this spring when Dave Garrett, an Atlanta real estate developer and the lottery board’s first chairman, suggested making up a HOPE scholarship shortfall by installing video lottery terminals in convenience stores – where scratch-off tickets are now sold.

The Spectrum study doesn’t even consider the convenience store question. ”The concept that was always kicked around to me was more of the casino approach,” Braswell said.

So someone has done some kicking. More than likely, it’s someone who’s willing to bet a good deal of money that American attitudes toward gaming are changing. It’s a good bet.

Five years ago, former Christian Coalition leader Ralph Reed’s run for lieutenant governor was deep-sixed by GOP voters, in large part because of his connections to anti-gambling campaigns – paid for by casinos trying to protect their turf.

Yet for several weeks this spring, casino mogul Donald Trump found himself the darling of the Republican presidential pack. His fall from grace, which led him to decline a formal candidacy, had little to do with his gaming connections.

In Washington, House Republicans this week held a hearing on a bill to legalize Internet poker. Testimony this week estimated that American gamblers are sending between $4 billion and $6 billion offshore each year – cash that could be taxed and applied to a giant federal deficit.

Another GOP presidential candidate, U.S. Rep. Ron Paul of Texas, has endorsed the idea – as has Trump.

The measure is sponsored by U.S. Rep. Joe Barton, R-Texas. “Poker is the all-American game. I learned to play poker, believe it or not, in the Boy Scouts,” Barton testified Tuesday. “If you learned something in the Boy Scouts, it has to be a good thing.”

That’s not a line of reasoning that will satisfy a Southern Baptist preacher, but it is one that apparently appeals to a growing number of Republican voters.

- By Jim Galloway, Political Insider

For instant updates, follow me on Twitter, or connect with me on Facebook.

199 comments Add your comment

DannyX

October 26th, 2011
6:21 pm

We already have legalized gambling here in Georgia, why do you think Georgia banks keep failing.

Sonny Days Casino
Big Deal Casino
Graves Casino and Roach Motel

Coming soon

frank

October 26th, 2011
6:22 pm

Wow nice work. probably makes too much sense to ever happen. All that money… currently going of state. not to mention the effect it would have on tourism and conventions.

Centrist

October 26th, 2011
6:23 pm

Excerpts from above”

“This effectively means that VLTs offer multiple revenue streams that simply do not exist with traditional lottery products.” In other words, the construction of hotels and associated entertainment venues would mean increased tax revenue that could be used for more than HOPE scholarships.

The report pointedly warned that casinos could aggravate political corruption.

The report estimated that 10,000 illegal slot machines now operate in Georgia. The same number of machines that, under state-licensed casinos, could bring $933 million a year.
Testimony this week estimated that American gamblers are sending between $4 billion and $6 billion offshore each year – cash that could be taxed and applied to a giant federal deficit.
[End excerpts]

Now I’m no prude and don’t much care if this comes about or not. I’ve been to Las Vegas and will likely go again. But ALL of the above also would apply to legalizing/ taxing other vices like drugs and prostitution which are also going on untaxed. Maybe some smoke and cat houses should be considered, too – think of the jobs and tax revenue!

bev

October 26th, 2011
6:32 pm

Terrible idea!! If people want to go to a casino, they have other options. With casinos, come more drunk drivers on the road, prostitution, etc., etc., etc.!! No thanks to the riff raff!

John

October 26th, 2011
6:37 pm

I guess President Obama isn’t going to offer the Cherokees up in Dahlonega federal recognition in time to compete with this Georgia Lottery- Braswell dream (cheap video gaming) The big money is behind a grand Lake Lanier casino development complete with horses. Part of the Northern Arc, badly needed to bring folks in has been approved by the powers that be. It is just up to the voters to tax themselves.

republicarat

October 26th, 2011
6:38 pm

At what point are we selling our sole for anoher nickle.

Centrist

October 26th, 2011
6:39 pm

I pay my fair share of Georgia alcohol taxes. Only play the lottery once or twice a year (stocking stuffer and when it rolls over to record levels). Purposely drive slightly older cars to avoid high ad valorum taxes. I Don’t use tobacco products, so not doing my share on those taxes either.

I want to be a good citizen taxpayer – anybody know where I apply to help with the study on potential cat house revenue?

Makes too much sense

October 26th, 2011
6:39 pm

This state is so freaking stupid. Casinos are fun every once in awhile and lots of people with money do go! Oh, and God doesn’t care if you go to casino! Our only competition is casinos in Florida and the Harrah’s in the NC mountains. You can’t tell me all these so called “southern conservatives” aren’t buying plane tickets to Las Vegas or driving to Harrah’s in Cherokee, etc. What a bunch of hypocrites. Stop telling us what we can’t do with our lives and let us choose!

This would be a huge boost to our economy, create private-sector jobs (construction to build them and people have to work at the casino!) and give us another entertainment option without having to leave the state. All you religious hicks need to get over yourselves and leave the rest of us alone.

Carpetbagger

October 26th, 2011
6:40 pm

We can’t buy a six pack on Sunday. Now you want gambling?

Atlanta1987

October 26th, 2011
6:43 pm

I moved here from Tampa where we have the Hard Rock Casino. Many tourist from all over the country come to visit there. Atlanta is lacking greatly on its tourism. The casinos do not necessarily bring a horrible crowd but a mature crowd to the area. My parents go there with and they do not even gamble. It does not bring everyone there, but it is something different. As long as its in the city and not in residential areas I do not see a problem with it.

Chappy

October 26th, 2011
6:43 pm

Oh, yes, PLEASE! Let’s have more penniless people wandering the streets looking for a way to make back their rent they just gambled away by more car jacking, more robberies, more break-ins, more thefts, more pandering and pan-handling, more harassing legitiment visitors and vacationers by these fools who just spent their kid food money on government sanctioned gambling/next new mafia crapolaIDEA of robbing funds from the least who can afford it and insufficiently educated to realize its a stupid thing to do.

Darwin Award to government of the state of stupid for entertaining this destructive idea and masquerading it as intelligent. Destroy the people of the state and tell me who you intend to rule?

Honkie

October 26th, 2011
6:44 pm

Sounds like a great deal to me…If their is anyone out there actually believs that you cannot gamble today, albeit illegal, they are sadly ignorant of the way it is. It sure would be nice to have the present gambling profits go to the existing infrastucture so badly in need of repair. Put it up to a vote and let the people decide. Just watch the churches and all the other do-gooders assail any attempt at a licensed casino here.

Jackson Baer

October 26th, 2011
6:48 pm

You gotta love Ron Paul. He speaks the truth and doesn’t care what people think. Agree with him or not, you have to respect his honesty and consistency.

http://www.whatthehellbook.com/the-book/

To logical

October 26th, 2011
6:48 pm

Gaming in Georgia, and particularly para-mutual betting just makes to much sense to ever pass in Georgia. It is just a shame.

There should be a horse track in the Atlanta area and dog tracks in Atlanta and either Savannah and/or Jekyll Island. Unfortunately I don’t think the “preachers and bootleggers” will let it happen.

Centrist

October 26th, 2011
6:51 pm

The lottery and betting against the house casino is a tax on people who are poor at math.

(I like it)

whatdoiknow

October 26th, 2011
6:56 pm

Well . . . What else would it bring that might actually put a drain on government resources?

sheepdawg

October 26th, 2011
7:19 pm

overall intelligence of the GA electorate will have to increase to allow such a common sense initiative

tim

October 26th, 2011
7:22 pm

The Ga Lottery Comm is a flim flam group. They just want to put more money in their pockets. Beware of anything they spew out of their crooked mouths.

Sheila

October 26th, 2011
7:23 pm

Starting several years ago, The Georgia Lottery, started it’s propaganda for the passage of casinos. Nearly every commercial showed players inside a dark casino bar, glamorizing KENO.

The chairman of GA Lottery wants you to now believe, he was just curious whether an “independent” study would show if casinos would generate money, and where those should be located. How gullible does he really think we are? The “Deal” has been struck, and EVERYBODY knows it. It is just about who gets the biggest cuts of the action, now. And, how big the plans are. Nobody wants video gambling, so that is where the GA Lottery will set their phony political sights, so the public “cries” for bigger (less tacky) plans will have to be considered. They heard the people, and the people will be herded under their leadership. Graves, you got it all figured out?!!!

arrgy

October 26th, 2011
7:25 pm

Pennyless drunk people running around Georgia? We already have that, casinos didn’t do that. Lets see since casinos have blossomed across America in places like Mississippi, Pa., De., Ct., etc. the FBI reports that crime rates have gone DOWN. Crime rates across the country are lower now then when the only place you could gamble was in Nevada and A.C. So that argument is a bunch of crap. The questions are simple. If people are going to gamble they will gamble. DO you want their money here in Georgia or somewhere else? Second, We already have casino boats at Savannah and Jekyll…has it really effected life that much? No.

People like Bev need to get out of the 1950’s. Casinos don’t effect crime they don’t cause drunk driving or prostitution, etc. These are the same tired arguments used by folks all over the country that once opposed casinos.

Brad

October 26th, 2011
7:30 pm

The problem with VLTs is that consumers catch on to them too quickly – the average slot machine (like in Las Vegas) holds only 7 cents or so of every dollar wagered. A VLT holds 75 cents – or more. Look on the back of your next scratch ticket and see those odds – 1 in 4.2 or something like that. Consumers get tired of losing every time – I would never invest state money in a VLT parlor!

SAWB

October 26th, 2011
7:31 pm

Sound cool to me just as a long as they are located in out of the way places so I don’t have to see those gaudy places. You know all those colors and flashing lights are to attract the lower IQ crowd. So, that is just fine let the white and ghetto trash gamble just a little more and lower my taxes.

Tom

October 26th, 2011
7:31 pm

The faux red head of a chunky south Ga former dental assistant just did a full 360.

Scott Anderson

October 26th, 2011
7:32 pm

Enter your comments here

Sam the Sham

October 26th, 2011
7:35 pm

NO ONE (NOT ONE PERSON) will fly into Atlanta Georgia to play video lottery machines. You want it to work…bring in REAL casino gambling. This is an enormous joke.

Worked in Vegas

October 26th, 2011
7:36 pm

Having worked in Vegas at a major casino, I can tell you all of these people that oppose the casino’s in Georgia are going to Vegas. Clergy that are preaching the evil ways of gambling are some of the highest gamblers in Vegas, not to mention the hookers they have for company.

We just need to let this generation of Congress hurry up and get into retirement. Once the Generation X and Y’s come into control of things, you will see a different world that functions better and is less controlled by religion and is in the interest of the people.

Mike

October 26th, 2011
7:36 pm

Perhaps the state should start marketing low-priced, fortified wine to start funding Medicaid. Call it Georgia Dog.

fish

October 26th, 2011
7:48 pm

Only an ignorant fool thinks gambling is a bonus for the state.
First the gambling pot if already oversupplied.
Secondly look at every state that has it and they all
have money issues.
Third it will take away from the lottery.
Fourth it will break people who can’t afford it.
Just go to Tunica on a Friday night and stand at the cashier window
and watch the poor suckers bringing in their minimum wage checks to cash so
they can gamble it away.
Fifth, the support services that will have increased clients will be a huge burden.
Sixth, it will take away from the casino junket businesses that make a living transporting suckers to out of state casinos.
And lastly, the money will be wasted on new programs to benefit the politically connected.
Their are other reasons but that is enough to make any sane man say hell no to gambling in Georgia.

KF

October 26th, 2011
7:50 pm

I agree with Sam; if you want this to work then build a few real casinos. Vegas is over-priced (not to mention far away) and Biloxi is a dump. We already have the infratructure in place (hotels, tourist attractions, etc.) to make legalized gambling a very profitable venture for the state.

Drew

October 26th, 2011
7:50 pm

I think its a great idea. Its a great way to entertain people who can afford to throw money in a trashcan, and by entertaining them swimming in their money and watching it run away, all of us can have our education paid for, and get better infrastructure. I think its a great way to get this Republican state to finally tax the rich who dont care about money.

fish

October 26th, 2011
7:51 pm

I will add, I hang around a lot ot gamblers and almost all of them have financial troubles.
Troubles caused by…………..GAMBLING.

TomPaine

October 26th, 2011
7:52 pm

do conservative “Christians” like ANYTHING???

LC

October 26th, 2011
7:55 pm

Georgia is to back woods for anything like a casino, horse track, or other attraction.

Dr. Kenneth Noisewater

October 26th, 2011
7:56 pm

It worked up in Detroit too. I’m puzzled as to why it cost the state 91k to do the study? Underground could be revitalized, keeping everything for the most part out of sight. Savannah & Lake Lanier would be great locations as well. The state needs more revenue people!!! Get your head out of the sand!!

@fish

October 26th, 2011
7:56 pm

it is a voluntary tax..we need the infusion of $$$….duh!!!! ur gambler friends could boost Georgia’s economy…..

Drew

October 26th, 2011
7:56 pm

They should put a couple casinos right next to each other near the Aeropolis (capture all the Hartfield/International money), put one on Hutchinson Island next to the Westin, and a seasonal casino in Augusta for the Masters. The Savannah and Augusta casino’s will get a LOT of South Carolina money for the price of one. Maybe even put some smaller ones in Columbus, Dalton, and Valdosta to capture the other states.

Jack Nasty

October 26th, 2011
7:57 pm

We have the perfect place for it — Underground. Underground has never been what we need it to be, but if you put a casino there, it would be perfect.

Jon Lester

October 26th, 2011
7:59 pm

I don’t see any proposal to modify the indoor smoking ban in order to maximize the returns on casino gambling.

td

October 26th, 2011
7:59 pm

Let us see Channel two did a report about 5 or 6 months ago talking about our welfare recipients going to places like Vegas using there welfare EBT cards to gamble and now we want to bring it to there back yard? Great idea.

@td

October 26th, 2011
8:02 pm

the state of Georgia could pocket the $$….next question….

bout to be ex educator

October 26th, 2011
8:12 pm

A casino would bring hundreds of jobs to the communities. I think the positives far outweigh the negatives.

Responsible Gamer

October 26th, 2011
8:13 pm

Horse Racing alone won’t survive. They’re drying up across the country. The “Sport of Kings” just isn’t anymore. We need destination resort gaming properties with golf, spas, etc. and GA’s coast, along with the Horse Racing track proposed in South Fulton, would all be winners for GA.

HENRY

October 26th, 2011
8:18 pm

VIDEO MACHINES DOES NOT CONSTITUTE A CASINO. YOU NEED LIVE GAMES WITH REAL PEOPLE. GO TO VEGAS AND OBSERVE. I CAN PLAY A VIDEO MACHINE AT THE 7-11 BUT I CAN’T ROLL THE DICE….THAT’S WHAT I WANT.

KOOL

October 26th, 2011
8:20 pm

I am all for it as long as it not used on new spending. I don’t trust any of those idiot politicians to spend our tax revenue in a responsible and practical way. Use this money to balance our state budgets each year if enough revenue is generated from the gambling… place any budget surplus that may be generated, in an interest bearing account once all government debt has been settled.

chalkdawg4

October 26th, 2011
8:21 pm

These machines are crap. They are set to take over 40% of the money placed in them. A real casino gives the skilled bettor a chance, Something like 52-48 odds. It will kill you over the longterm but you might get lucky over the short haul. No real gambler trusts a machine. If we could open real casino gambling I would be behind it. My son is attending college this fall on the HOPE scholarship. Look at the money they have provided for education. If you bet with these games you are a sucker. Better off driving to Biloxi or Tunica and getting a fair game. Just sayin!!

BEND OVER, HERE COMES THE CHANGE

October 26th, 2011
8:24 pm

What’s the big deal. I am a southern Baptist and I say no one is forcing YOU to gamble. I am all for a casino, but it need to be Vegas style with gaming tables, black jack, roulette, etc.

ATLBorn

October 26th, 2011
8:26 pm

I love the idea of casinos in GA and I’m not a gambler. I agree with several other posters about no VLTs but full fledged casinos with real slots and table games. Drinking and driving won’t increase anymore because of casinos, drunks will find a reason to get drunk any day of the week for whatever reason. Prostitutes will come, but the clientele a real casino will have won’t go for the low rent, hanging on the corner hookers you see on Stewart Ave. I’ve seen way more hookers prowling the streets of GA than I’ve ever seen in Vegas. They go after their clientele with advertisements on flyers and pamphlets there.

Underground ATL would be a great place for a casino, so would Savannah.

Shine

October 26th, 2011
8:30 pm

The last place we need gambling is Jekyll island. Develoment nuts and crony capitalist are out to destroy this place for families. There is already a boat in Brunswick you can get on and ride to International waters and gamble to one’s heart desire. We dont want or need the crime, drugs, hookers, etc that will come with the gambling in South Ga.

speak the truth

October 26th, 2011
8:30 pm

I am amazed at the knee jerk reactions voiced here based on mis-information and unfounded fears. The citizens of our state voted in a lottery almost 20 years ago. It is run by a group of professionals that are recognized by their peers world wide to be among the most successful. No one questions when the lottery adds a new game. They are responsible to find ways to maximize revenue. VLTs are no different – just another way to play the lottery. That revenue educates our kids and in the case of a casino keeps $$ in Georgia that is going elsewhere. Do some research, as the chairman has done, before you speak. but this IS a blog, where everyone is an expert and can hide behind a screen name

Centrist

October 26th, 2011
8:31 pm

@ KOOL – You are correct in not trusting our “politicians to spend our tax revenue in a responsible and practical way”. That is why we have them ADDING taxes via SPLOSTS for parks, roads, buses, rail, education, special districts, etc. They simply refuse to use income, sales, ad valorum, and property taxes for infrastructure if they can buy votes and get rich by spending it on other things. They lie about toll road taxes being retired (GA 400), and continually look for more income streams like the changing HOV lanes to less used income HOT lanes and now casinos.

We DO balance our budgets – but on THEIR priorities.