Casino Gambling Legalization Introduced; Projections Suggest $250M For HOPE

Charlie Harper

Thursday, March 26th, 2015

Georgia legislators have toyed around with the idea of allowing horse racing at a new small scale race track. We’ve seen ideas floated to revive Underground Atlanta (since sold to a SC developer) to be a “casino” with video games of chance operated by the Georgia Lottery Corporation. Yesterday, a bi-partisan group of lawmakers has dropped bills  that would pave the way for Georgia to aim higher and assert itself into the major leagues of casino gambling. Supporters of HR 807 and HB 677 tout a potential payoff of 10,000 construction jobs, 10,000 permanent jobs, and – perhaps most importantly – $250 Million dollars added to HOPE’s dwindling coffers every year.

The initial plan would divide the state into five zones, offering up to six licenses that would be awarded by competitive bid. The Atlanta casino (Zone 1) would require a minimum of $1 Billion investment in facilities. Backers make it clear it would be a world class destination facility, pointing to a similar casino/hotel/entertainment complex under construction adjacent to the National Harbor convention center in Maryland, just outside Washington DC, as the model.

There’s a bit more than a wink and a nod to the site where the Georgia Dome currently sits. The GWCC has noted recently that they would like to see a large hotel on that parcel with as many as 800-1200 rooms. It’s clear a Destination Casino on site would give the State owned convention center a leg up on national competitors, as well as fully anchor the Dome/Phillips/Centennial Park area as Downtown Atlanta’s entertainment district.

A secondary casino would be allowed in zone one (which includes not only most of metro Atlanta but all of North Georgia, but the secondary casino would be limited in size to no more than 2,000 total gaming positions

The other four zones would require casinos with a minimum of $200M in facility investment. At the top of likely locations in Zone 2, which includes Chatham and 15 neighboring counties, is Savannah’s Hutcheson Island. Savannah has recently been conducting feasibility studies noting that additional hotel capacity is needed to lure larger conventions, as the downtown/River Street area hotels are generally able to remain at or near capacity with a strong year round tourist draw.

Zone 3 includes 16 counties in central Georgia, with possible suitable locations in Millegeville/Baldwin County (Lake Sinclair), Putnam (Lake Oconee – though Green County is in Atlanta’s Zone 1), or along I-75 from Monroe to Dodge Counties.

Zone 4 is anchored by Columbus (whitewater rafting and blackjack, anyone?) and extends northward to Pike County, and deep into Southwest Georgia.

Zone 5 includes the southeast Georgia coast (St. Simons, Jeckyl, St. Marys), with much of Deep South Georgia included in the land mass.

By statute, the Georgia Lottery Corporation would be changed to the Georgia Lottery and Casino Gaming Commission. Thus, the Georgia Lottery Corp would have its mission expanded to award the licenses and then regulate the privately run casinos.

A study study committee that will vet the draft legislation through the summer and fall and propose bills for a constitutional amendment and enabling legislation for the 2016 session of the Georgia General Assembly will be proposed tomorrow in differing legislation. Presuming the measures pass (requiring 2/3 vote of both chambers for the amendment), the question would appear on the 2016 November Presidential/General Election ballot.

The question as drafted to put to voters is the following:

Shall the Constitution of Georgia be amended to preserve the long-term financial stability of the HOPE scholarship program and to support other educational programs through net tax and licensing revenues generated by permitting a limited number of counties and municipalities to approve by referendum the establishment of licensed resort facilities within their localities where casino gaming is permitted?

Sponsors of the bill include Chairman of the House Economic Development Committee Ron Stephens (R-Savannah), Stacey Evans (D-Smyrna) – a noted advocate for full funding of HOPE, Ben Harbin (R-Evans) and Carl Rogers (R-Gainesville).

Chairman Stephens said of the opportunity “To have a Cadillac tourism destination that creates 10,000 jobs and adds $250 Million annually to HOPE and Pre-K, without asking for one dime in taxpayer money for incentives, that’s something we can’t pass up”.

Presuming approval statewide, local governing bodies – city or county – would then be able to hold local referendums asking voters if they wised to allow a casino in their locality, similar to Georgia’s current processes to authorize liquor by the drink or Sunday alcohol sales. Thus, the earliest any applications to license a casino should be expected would be sometime in 2017…about the same time the Georgia Dome would begin the process of being torn down.

The casinos would pay a “fixed gaming revenue rate” to bolster the HOPE scholarships, but Georgia’s and local tax rolls would likely see boosts elsewhere. 10,000 new jobs means income and sales taxes from employees. 1,000 new hotel rooms downtown means more hotel motel taxes, as well as the additional revenues that come from increased convention business. It’s estimated as many as 10,000 additional secondary jobs would be created via suppliers, employee spending, increased tourism and convention traffic, etc.

The question will likely cause an initial stir among voters who have long voiced opposition to casino gambling, not unlike when Governor Zell Miller first proposed the lottery. Many still choose not to play the lottery, but the HOPE Scholarship remains revered as one of the state’s most popular programs. The question that will be put before voters is whether or not they wish to keep dollars currently going to casinos out of state home, and with it, offer a significant new entertainment anchor for the state’s convention and tourism business.

Charlie Harper lives in Atlanta and edits the Peach Pundit political blog.

About Charlie Harper

Charlie Harper is a Marietta Georgia based conservative-leaning policy and political strategist.