The difference in response by state leaders was too dramatic to miss. Last week, state officials in South Carolina faced the loss of gambling revenue and said good riddance. At the same time, some Alabama state officials were falling all over themselves trying to give the state’s leading gambler a $2.5 million tax break.
Last week, the U.S. Supreme Court issued the final ruling in the demise of South Carolina’s $2.8 billion video poker industry. The state Supreme Court had invalidated the law that allowed the casino-type games. The suit before the U.S. Supreme Court sought to overturn the state court’s ruling.
Some argued video poker gambling was too important to lose. About 3,000 people work in the gambling dens. The state’s take from the gambling pool was about $60 million last year.
When the U.S. Supreme Court refused to intervene and sealed the death of video poker in South Carolina, state leaders said good riddance. Earlier they had passed a bill outlawing video poker unless the people of the state voted it in through a general referendum. The lawmakers had seen the damage gambling did to their state and wanted no part of it.
The speaker of the South Carolina House of Representatives, David Wilkins, predicted, “By this time next year, video poker will be nothing more than a memory.” There was no great cry about the loss of state revenue or about the displaced workers. Instead, state economists pointed out the growing economy in South Carolina would absorb the displaced workers without difficulty. The $60 million tax loss was put in perspective when officials pointed out the loss amounted to less than 1 percent of the state’s budget.
In other words, no big deal. Video poker gambling was not something South Carolina officials wanted in their state.
In Alabama, it was a different story. After failing to win approval for video poker gambling at the state’s four dog tracks, the gambling crowd went after a consolation prize — a $2.5 million tax break. In six days, the tax reduction legislation, H.B. 867, was introduced, passed by the House of Representatives and approved by a Senate committee. The near-record progress of the bill means, at this moment, it awaits only a final vote in the Senate.
Not surprisingly, the same legislators who supported video poker at the dog tracks greased the skids for the tax-break legislation.
Gamblers already pay one of the lowest taxes in the state — 1 percent. The legislators, in their wisdom, will not allow a mother to buy a loaf of bread or a gallon of milk and pay only a 1 percent tax. Businesses pay more than 1 percent tax on their inventory and sales.
Yet, those committed to spreading gambling in Alabama had the gall to ask for a 50 percent reduction on the betting handle taxes — down to one-half of 1 percent. More startling, 53 state representatives voted for the legislation. So did 11 of the 16 members of the Senate committee that heard the bill.
One state senator said he supported the bill to protect jobs. Such a statement sounds like a ruse. The tax bill cuts the taxes on dog racing and dog racing is a seasonal business. That means part-time jobs. Gambling on horses is done through simulcast. Gamblers place their bets on races shown on television. Again, most of the related jobs are low-skilled, minimum-wage jobs.
If South Carolina’s economy can absorb 3,000 full-time jobs lost because of the death of video poker, is it reasonable to assert Alabama’s economy cannot absorb a handful of part-time jobs? Is it reasonable to say the state must put $2.5 million back in the gambling crowd’s pockets to keep a few part-time jobs? The issue is not jobs. The issue is support for Alabama’s well-entrenched, well-connected gambling crowd.
Another legislator said “half of something is better than all of nothing.” That is not what South Carolina legislators decided. They decided their state would be better off without gambling, and they voted to close down video poker, which had a much more significant financial impact on their state than dog racing has ever had on Alabama. Pari-mutuel wagering generates about $3.8 million annually. That is less than one-hundredth of a percent of the state budget.
And that is not what the people of Alabama said when they defeated lottery gambling last October. Expanded gambling or expanded support of gambling is not something the citizens of this state desire.
What evidence is there that dog racing needs a tax break or that part-time jobs will be lost without this windfall tax bill? None. Two of the three tracks impacted by this legislation are among the top 10 tracks in the nation in terms of total wagering. The third is number 15 on the list. That does not seem to indicate a high financial need.
All the rhetoric is nothing but a bunch of officials looking for some way to defend the indefensible and needs to be recognized for what it is.
There is still time to stop this private-interest legislation. There are a lot of other bills that have been waiting a long time for consideration by the state Senate. If HR 867 is debated it will be because rules committee chairman Jim Preuitt calls the bill to the floor. If you have concerns about this bill you may contact your state senator or Sen. Preuitt by calling 334-242-7800.
Share with others: