We’ve come 180 degrees in the evolution of the casino industry in the U.S. State governments once embraced them as what Dover Downs Gaming & Entertainment CEO Denis McGlynn calls a “sin-tax pot of gold.” Now they’re flailing amidst overmuch competition and the same McGlynn is looking for a Delaware bailout, declaring forlornly, “We’d accept anything at this point.” No wonder. Dover Downs and its fellows are laboring under a 43.5% tax rate (!) and a further 10% impost to subsidize the horsey set. It can’t be easy to make your nut when over half your income goes to taxes, and Maryland and Pennsylvania have crashed your party. Tax cuts aren’t on the table yet but various restructurings of Delaware’s revenue split are under discussion, as is a tiered tax structure — like Nevada’s but at a much higher rate. It may not be ideal but it’s progress.
Halfway across the country, Iowa lawmaker Rick Bertrand (R) — taking note of the state’s addiction to 
casino lucre — is proposing a cap on further casino licenses. Politically, it’s a long shot even if it has the virtue of common sense. Bertrand’s constituents include Penn National Gaming‘s Argosy Sioux City, so the have-nots will accuse him of hypocrisy, for certain. But when one considers the present economy, it’s difficult to argue with his contention that the Hawkeye State is headed down the road to “diluting the casinos to the point we have 60 half-full casinos that no one wants to go to,” as Bertrand puts it. But when the state is pumping $286 million in casino taxes into its veins, that’s a hard habit to quit.
Theatre of the Absurd is playing out in western Massachusetts. A poorly proofed Associated Press story reports that “Several towns around Springfield have passed non-binding referendums against a [casino]. The state gambling commission will take the opinions of surrounding towns into account when deciding where a casino would go.” I don’t know if the AP has noticed but there’s only one casino application pending in west Massachusetts and it’s MGM Springfield. So if the casino’s not going in Springfield, where’s it supposed to be put?
Across the state, in Taunton, an environmental-impact report on the Mashpee Wampanoag casino project kicked up quite a ruckus. I suppose that’s to be expected when “a 400,000-square-foot resort casino featuring a 15-story hotel tower, a total of 900 hotel rooms, a 132,000 gambling floor and multiple restaurants [plus] 25,000-square-foot water park” are foreseen as demanding “more than 20,000 new vehicle trips on peak days, an increase of more than 300,000 gallons per day drawn from Taunton’s water system and 225,000 additional gallons of wastewater generated each day, according to the report.”
Stat of the Day: “MGM is still burning off [Las Vegas] conventions that were booked during the recession at lower rates with newer groups booking rooms at $50-60 premia relative to the average leisure guest.” — J.P. Morgan analyst Joseph Greff.
