Say Yes to New Hampshire. Say NO to Casinos.
3. Including casino license money to fill a state budget hole is a recipe for budget chaos.
Casino investors will require either escrow or a full refund of any license money if state and local authorization to build and operate a casino is not ultimately granted. These steps (and others) must first be completed: casino regulations written, revised, and approved; casino bid process and selection completed, criminal background checks for casino investors and management; local voter referendum; local planning, zoning, and infrastructure construction approvals; selection and testing of the state central computer system; litigation and appeals won.
These steps cannot be rushed or bypassed if a casino is to be “highly regulated,” as the Governor has required as a condition for her support. Short-circuiting these steps would result in irreversible errors seen in other states, such as selection of an unqualified casino developer or a corrupt management team.
In Massachusetts, the state to have most recently legalized casinos, it required 2 ¼ years to issue its first casino license and 5 ½ years before the first casino opens for business and generates operating tax revenue.
For the six most recent states to have opened casinos at racetracks, the fastest time to revenue was 22 months, and the average time was about 25 months.
- New York legalized slots at racetracks on October 2001. Saratoga Springs was the first racino to open in January 2004, 27 months later.
- Maine passed a law allowing slots at Bangor in November 2003. The racino opened 22 months later in November 2005 in a temporary facility with 475 slots. The final facility with 1,000 machines opened in June 2008, four and a half years after passage of the law.
- Pennsylvania passed its law authorizing 61,000 slots in June 2004. The first racino opened in November 2006, 27 months later. As of December 2008, four and a half years later, only 16,000 of the authorized slots had been installed.
- Florida voters authorized racino slots via a constitutional amendment in November 2004. The first racino at Gulfstream Park opened in November 2006, 24 months later.
- Kansas passed a law authorizing four publicly owned casinos in March 2007. The first, a 584 machine slots barn, opened in December 2009, 31 months later. Three of the firms that initially won bids to build those casinos dropped their plans.
- Maryland authorized 5 casinos in November 2008. The first casino opened in September, 2010, 22 months later. In one case, a license was granted to a developer unable to obtain financing.
Consultant WhiteSand Gaming’s October 2013 report to the NH Gaming Regulatory Oversight Authority on legislative proposals (page 18) notes, “It is common practice for operators to enter the market with a smaller footprint and to grow a facility as demand increases. If the desired result is a single high end commercial casino of a size and magnitude commensurate with the number of machines and gaming positions cited it will be critical that short term revenue projections do not anticipate the maximum level of build-out.”