“Casinogate” – the biggest lie and deception behind Proposition A’s “30%” funding estimates

In an article published by the Joplin Independent, State Rep. Ray Salva outlined the deception and lies behind the main statistic used to determine the amount of money Proposition A would generate.  The Missouri Gaming Commission claimed that 30% of Missouri gamblers leave the state due to the $500 loss limit.  They reason, then, that removal of the loss limit would bring those gamblers back to Missouri and increase the money generated by casinos.  The problem, however, is that conclusion is not supported nor endorsed by the authors of the study.  Rep. Salva supplied the personal email from the researchers behind the Missouri Gaming Commission’s Market Survey conducted by the University of Missouri St Louis:

The study did not address the impact on gaming revenues associated with the elimination of loss limits.

While the study did not estimate the fiscal impacts in Missouri of loss limit repeal, it is possible, that some person(s) (other than the University of Missouri and/or its employees) created estimates of fiscal impact on their own accord drawing inferences from information disclosed in the study. If so, such estimates were generated and reported without the participation of the study’s authors or the University of Missouri. The fiscal impact estimates currently set forth in the fiscal note accompanying Proposition A were generated without the participation of the study’s authors.

So why is this important.  If 30% leave the state to gamble outside of Missouri because of the loss limit, then why would it matter if the conclusions were drawn by the original researchers or the Missouri Gaming Commission and the Casinos who purport how much money Proposition A would generate?  The reason it’s important is because the Market Study DID NOT CONCLUDE THAT 30% OF MISSOURI GAMBLERS LEFT THE STATE AS A RESULT OF THE LOSS LIMIT.  The authors would have never come to that conclusion because they understood what questions they were asking and what answers were generated as a result of the questions.

This false statistic is generated from page 57 of the Market Survey where respondents were asked:

“During the past five years, have you played the slot machines or table games at a facility in Las Vegas or other parts of Nevada, Atlantic City, New Orleans, Iowa, Tunica, Mississippi Gulf Shore, or at a Kansas Indian Tribe facility, or any other gaming locale located outside Missouri and Illinois?”

30% of respondents had, at least once, taken a trip to go gamble.  This question does not address those gamblers leaving Missouri to gamble in Illinois because of a loss limit, the loss limit was not even mentioned as a possible cause for such a trip.  The question clearly excludes gambling in Illinois, the only real competitor for Missouri casinos, and the question is clearly addressing leaving the Missouri/Illinois area for a gambling trip to some place like Vegas, Atlantic City or Tunica.  They even indicate on page 56 that the nature of this question lends itself to asking about destination gambling, not a local gambler who might care about loss limits.

HOWEVER, the study did clearly ask a very direct question which would address whether or not loss limits effect gamblers decisions:

“If the $500 loss limit for Missouri’s gaming facilities was eliminated, would you be more likely or less likely to visit casinos in Missouri or would it not make much difference either way? (page  40 of the study)

84% of respondents said that removal off the loss limit would not influence their decision to gamble in a Missouri Casino and only 7%, NOT 30%, indicated they would be more likely to gamble here, but the remaining 7% said they would stop going to Missouri casinos resulting in a net wash.  The study also indicated that loss limits were the least likely factor in determining which location they go to in order to gamble, indicating that proximity, number of slots, and quality of the facilities were the factors which influenced gambler’s decisions.

The bottom line is that the casinos and the Missouri Gaming Commission have twisted a statistic, in the worst way, to build a fiscal argument, with the intent of showing greater numbers, in an effort to frame this debate around how much money is being lost, thereby creating a need to remove the loss limit.

I have no doubt that the casinos will benefit greatly as a result of this proposition; they wouldn’t spend $16 million if they didn’t believe that to be the case.  The source of that revenue might very well come from the 13,000 addicted gamblers who have placed themselves on the self-ban list that would be able to walk right back into the casino and lose everything should Proposition A pass.  The source of this new revenue is debatable, but to say that 30% are leaving the state because of the loss limit is a lie, and to that degree, their promise for $100 million in new tax revenue is sophistry.

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