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Gambling Expansion in New Hampshire
David Lumbert
Boyd Lever
Andrew Newcomb
Is it a Gamble?
Rockefeller Center at Dartmouth College
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The Center for Public Policy and the Social Sciences
• New Hampshire Gaming Study Commission
– Cannibalization of Lottery Revenue
– Gambling and Crime
– Social Impacts
Rockefeller Center at Dartmouth College
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The Fiscal Impacts of Casino Legalization
Cannibalization of State Lottery
Revenue?
VS.
Rockefeller Center at Dartmouth College
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The United States: A Nation of Lotteries
- 43 States with Lotteries
- Contributing $70 to
$2500 Million to State
Budgets
Rockefeller Center at Dartmouth College
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The Center for Public Policy and the Social Sciences
What About Introducing Casinos ?
NEED TO EDIT HERE
In Theory:
- “Significant Cannibalization” of Lottery Revenue
- Fink, Rork… what did he say
- Navin… what did he say
But models are specific; Not universally applicable.
Empirical Evidence from the 10 states with both
Rockefeller Center at Dartmouth College
Policy Research Shop
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States with Casinos and Lotteries
- 10 States with
Lotteries & Casinos
- The Research Targets to
Determine the Degree of
Cannibalization of Lottery
Revenues
Rockefeller Center at Dartmouth College
Policy Research Shop
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On Average, No Decrease in Lottery Revenue post-Casino
State
Years
Δ Revenue
Percent Increase
Colorado
2001-8
44.8 Million
44.3 %
Illinois
2002-8
490 Million
31.0 %
Indiana
2001-8
275 Million
50.1 %
Iowa
2001-8
74.1 Million
42.4 %
Louisiana
2001-8
89.3 Million
31.4 %
Missouri
2001-9
460 Million
90.0 %
New Jersey
2001-8
500 Million
25.0 %
Pennsylvania
2000-8
1.4 Billion
87.5 %
South Dakota
2001-8
118 Million
20.0 %
Rockefeller Center at Dartmouth College
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Casinos and Employment Trends:
Counties
Warren,
MS
Tunica,
MS
Massac,
IL
Lee,
IA
St. Clair,
IL
(URBAN)
St. Louis, MO
(URBAN)
Casino
Employment
2,443
12,689
883
367
1,184
2,050
# Casinos
4
9
1
1
1
1
County
Employment
25,030
5,636
7665
16,708
108,270
540,981
County Population
49,343
9,635
15081
33,313
256,599
1,015,417
Unemployment,
pre-casino
8.8%
10.7%
9.5%
3.7%
9.4%
3.1%
Unemployment,
post-casino
4.2%
7.1%
4.4%
3.3%
5.9%
3.9%
State
Unemployment,
pre-casino
8.2%
8.2%
7.5%
3.7%
7.5%
4.2%
State
Unemployment,
post-casino
5.5%
5.5%
5.4%
3.3%
5.4%
4.7%
Rockefeller Center at Dartmouth College
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The Center for Public Policy and the Social Sciences
Findings and Future Directions:
- Fear of Lethal Cannibalization Not Generally Realistic
- Tax Rate on Commercial Casino ?
-- Compare Revenues in 10 States immediately pre- & post- Casino
- Tease out the magnitude of cannibalization
- Quantify Fiscal Impacts of Changes in Casino-related Employment
- Money is Not Everything: What are the other Impacts of Gambling
Expansion ?
Rockefeller Center at Dartmouth College
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The Center for Public Policy and the Social Sciences
Gambling and Crime
Will expanding gambling in New Hampshire
lead to an increase in crime?
Rockefeller Center at Dartmouth College
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The Center for Public Policy and the Social Sciences
2008 Crime Rates in NH and United States
3500
D
3000
B
2500
E
2000
1500
Property Crime Rate
Violent Crime Rate
1000
NH is safest
state in
country
500
C
A
0
Rockefeller Center at Dartmouth College
Policy Research Shop
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Tourism-Crime Connection
As population density increases,
crime rate increases
Tourists particularly vulnerable
Nongambling resort complex
constructed in Kohala, Hawaii and
saw crime rise 300 percent in five
years
 No specific link between gambling
and street crime (Miller and Schwartz,
1998)
Rockefeller Center at Dartmouth College
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Casino-Crime Connection
Current Top Three Tourist
Activities in NH
 Casino patrons are
different from patrons to
other tourist destinations
Areas that legalize
gambling will almost
certainly see increases in
crime
Percentage Reporting
More incentives to commit
crimes around casinos
70.0
60.0
50.0
Sightseeing
40.0
Shopping
Scenic Drives
30.0
20.0
10.0
0.0
Sightseeing
Shopping
Scenic
Drives
Rockefeller Center at Dartmouth College
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Casinos Cause Crime
8% of crime in casino counties would not
be there if the casinos were not there
 Crime in casinos remains stable for three
years following establishment, but
increases after three years
First ten years of casinos operating in
Atlantic City crime rose 258%
Casinos are associated with an increase
of crime in Wisconsin, 6.7% of major
crimes caused by casinos
Rockefeller Center at Dartmouth College
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The Center for Public Policy and the Social Sciences
Casinos Don’t Cause Crime
 Some riverboat casinos in Indiana did
not see crime raise
Crime in the community does not
increase, only crime in the hotels and
casinos increases(Curran and
Scarpitti,1991)
Casino patrons carry large amounts of
cash and drink free alcohol, but actual
casinos do not cause crime (Walker, 2008)
2003 Study: Half of cities with casinos
saw crime increase, half saw crime
decrease
Rockefeller Center at Dartmouth College
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Findings on Crime
No clear consensus exists on
whether or not casinos actually cause
crime, but very likely that property
crimes in and around the casino will
increase
If tourism increases, New
Hampshire must be prepared to
allocate adequate resources to fighting
the crime associated with gambling
Avoid
Further
“boomtown”
research isphenomenon
needed in
(Peak,
determining
1993) where
actualbringing
costs of a casino
to
crime,
a rural
effect
areagambling
causes shock
has on
to law
enforcement
tourism, and evaluating current
crime rates
Rockefeller Center at Dartmouth College
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What are the other social impacts
of gambling?
Rockefeller Center at Dartmouth College
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Who are
Problem and Pathological Gamblers?
•Comprise 2-5% of total adult population
•Contribute 25-50% of all casino revenues
• Cost $10,000 per pathological gambler in costs annually
Rockefeller Center at Dartmouth College
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Annual Social Cost per Pathological Gambler
Business and Employment Costs
Loss Productivity on Job
Loss Productivity on Job
Lost Time and Unemployment
Bankruptcy
$1,082.00
$2,913.00
Lost Time and
Unemployment
$316.00
Bankruptcy
Suicide
N/A
Illness
Illness
Social Service Costs
Therapy/Treatment Costs
Unemployent and Other Soc. Svc.
Family Costs
Divorce, Separation
$700.00
Therapy/Treatment
Costs
$189.00
$442.00
Unemployent and Other
Soc. Svc. (incl. welfare
and food stamps)
Divorce, Seperation
$111.00
Abused Dollars
Abused Dollars
$3,834.00
Total
$9,587.00
Rockefeller Center at Dartmouth College
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Links to Problem Gambling?
Proximity
Type of Gambling
Age
Rockefeller Center at Dartmouth College
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Gambling and Loss of Social Capital?
Social Capital is
Already Declining…
So?
Casino Gambling
Expedites the Loss
Rockefeller Center at Dartmouth College
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Economic Transformation
Rockefeller Center at Dartmouth College
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Findings and Future Directions
Rockefeller Center at Dartmouth College
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