Gov. Andrew M. Cuomo sees additional casinos bringing upstate New York a more prosperous future, with thousands of new jobs and a share of gambling profits for state and local governments.
However, critics see a much different future for New York with additional casinos, saying that it will result in more bankruptcies, embezzlements and desperate gambling addicts. They and others believe that the poor would be especially vulnerable.
Voters get to weigh in Nov. 5 on which of those two visions they agree with.
Proposal 1, a statewide referendum, would amend the State Constitution by allowing up to seven Las Vegas-style casinos.
Western New York would be exempt from a new casino because of the exclusivity agreement that the Seneca Nation of Indians has with the state.
For two years, Cuomo has been pushing for additional casinos as a way to boost the upstate economy and produce more revenues for not only the state as a whole, but for local governments, which would share in the gambling profits.
“It’s not about casinos or not casinos,” the governor told reporters this week. “We have 29,000 gaming machines, so it’s not whether we should go there or not – we’re there. The question is, should we regulate them better, maximize the resources and create jobs in upstate New York by attracting the market of 50 million tourists in New York City.”
But Sam Magavern, co-director of a local think tank that serves more than 100 local nonprofit organizations, has studied what has gone on in Western New York, where there are three Seneca casinos, and reached a different conclusion.
“We think people need to take a much closer and harder look at what the costs and benefits of casino gambling are in New York State,” Magavern said.
“A lot of times, people see some short-term benefits, like construction jobs and a new source of revenue for government, but when you look at the whole balance sheet, that is not real economic development. They impose more costs than the benefits created for taxpayers and society as a whole.”
For instance, there already have been:
• A Niagara County postal carrier who stole $400,000 from an elderly man to pay for a gambling habit.
• A Niagara Falls roofer who defrauded an elderly man out of $600,000 to feed a gambling need.
• An Arcade woman who took $1.3 million from her employer to finance her gambling addiction.
• An Orleans County nun who stole more than $100,000 from two churches because of her gambling problem.
In addition, there even was a mother who gambled away $15,000 of her son’s cancer benefit money.
“It’s terrible for the individual victims, but it’s really just the tip of the iceberg in terms of the actual cost being imposed on the community due to problem gambling,” said Magavern, co-director of the Partnership for the Public Good.
These are hidden costs that taxpayers wind up paying for, he said.
“It’s the taxpayers who end up footing the bill when crimes have to be investigated and prosecuted, when people are incarcerated or they need public assistance after they’ve gambled themselves into poverty,” Magavern said.
Marlene A. Schillinger, president of Jewish Family Service of Buffalo & Erie County, notes that while state government is promoting gambling, it does little to address gambling addictions.
“Funding for treatment, education and prevention in New York State is at the point where it is almost nonexistent. We have experienced a decrease in funding over the last eight years,” Schillinger said.
Saturation of casinos in the state all but ensure that most of the visitors will be local people – many with marginal incomes hard-pressed to shore up their losses, Magavern said.
A new Partnership for the Public Good policy brief on casinos says that “people with low incomes often turn to gambling as a ‘Hail Mary’ attempt to get out of poverty.”
“Unfortunately, those with the least resources are the most prone to become problem gamblers,” the report says. “The National Gambling Impact Study Commission found that ‘of people with incomes under $24,000, over their lifetimes, 7.3 percent are at-risk gamblers, 1.6 percent are problem gamblers, and 1.7 percent are pathological gamblers.”
“They won’t be flying in from Switzerland to gamble in upstate New York,” Magavern said.
“It’s just going to be local people spending money that would be better spent on their rent, mortgage or, if its really discretionary money, local arts, entertainment, sports and restaurants.”
While these critics question the wisdom of increasing the number of casinos in New York State, a new ad campaign has begun downstate, urging voters to approve the referendum.
Stu Loeser, a spokesman for NY Jobs Now, an ad hoc group formed by the Business Council of New York with support from business, labor and gambling interests, disagrees with the critics. People are going to gamble, anyway, he said, so taxpayers may as well be the beneficiaries.
The group has launched a $1 million television ad campaign, with an estimated $1 million more to spend with 11 days to go before the vote. Opponents of casino expansion have no such war chest.
“New Yorkers spend $1.2 billion a year at destination gaming resorts across our state line in Canada, Connecticut, Pennsylvania, New Jersey and now Massachusetts,” Loeser added. “That doesn’t count Las Vegas. That means we, as New Yorkers, are generally driving far distances to subsidize tax revenue that creates jobs and supports schools in other states than New York.”
NY Jobs Now estimates that 10,000 jobs would be created in upstate New York just at hotels and resorts, without counting the community benefits from visits to outside attractions and restaurants.
In addition, it says that all of the tax revenue would go to towns, villages, cities and school districts across the state, with none entering the state’s general fund.
That could result, annually, in $430 million across the state, with $22 million going to Erie County and $7.5 million annually going into the City of Buffalo’s coffers, according to the State Division of the Budget.
But critics say that those claims are overstated, and they point to Niagara Falls as Exhibit A. There has been little of the promised economic spin-off that was to have materialized from the Seneca casino that opened 10 years ago.