Positive or not?

A casino would bring jobs and revenue to Lansing, but how much and at what price to other operations in Michigan?

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Lansing Mayor Virg Bernero said a casino in Lansing would have a “tremendous positive impact," but some experts disagree.

On Friday, following reports that hisadministration is negotiating for a casino, Bernero issued a writtenstatement saying his “administration strongly supports the concept of acasino in Lansing because it would have a tremendous positive impact onour local economy.” 

But Matthew Fletcher, MSU professor oflaw and director of the indigenous law and policy center said buildinga casino in Lansing would siphon wealth from other communities ratherthan create new wealth.

“Michigan Indian gaming is what I wouldcall zero-sum, it’s grown as much as it can,” Fletcher said. “If acasino generates let’s say $100 million, almost all of that is going tocome from other communities.”

Fletcher said the Indian gaming industryleveled off about 10 years ago at the $10 billion mark. Even the threenon-Indian casinos in Detroit started siphoning money from the Indiancasinos.

“There certainly will be positiveeconomic impacts (for Lansing), there will be some growth,” Fletchersaid. “The significance of it isn’t going to be a whole lot.”

Bernero did not give any numbers. Bob Trezise, president/CEO of the Lansing Economic Development Corp., did not return calls.

Ted O’Dell of the Lansing Jobs Coalitiondisagrees with Fletcher. He sees a Lansing casino as a massive jobcreator that would bring 1,500 new permanent jobs as well as 300construction jobs.

These jobs could range in salary from$9,169 plus tips for dealers to $169,047 for the casino’s generalmanager, he said, citing his own research. 

The Lansing Jobs Coalition, headed byO’Dell, has been researching the possibility of bringing a casino herefor months in order to create more jobs. Earlier this year, O’Dellcirculated a petition for a ballot issue to ask if Lansing residentswanted a casino. O’Dell said he also introduced tribal leaders to cityofficials in February, hoping to move the project forward.

“For us it’s not about the gaming,” O’Dell said. “It’s about job creation.”

But a study prepared for the NationalGambling Impact Study Commission by Adam Rose and Associates inPennsylvania in 1998 found that most casino jobs are “low-skill,low-paying service opportunities” that rely on tips.

James Nye, a spokesman for theSaginaw-Chippewa Indian Tribe, owner of Soaring Eagle Casino &Resort in Mt. Pleasant, and the Nottawaseppi Huron Band of Potawatomi,owner Firekeepers Casino in Battle Creek, said the tribes’ casinosprovide a wide-range of jobs at the casino as well as the tribalgovernment itself. Some jobs may be minimum wage, but others wouldoffer higher salaries, he said.

Another potential downside to casinos isthat they can drain a municipality’s resources in terms of fire, policeand emergency personnel protection when the casino first opens, thePennsylvania study said. However, the study concluded that the casino’srevenue would more than pay for sustained public service commitmentsover time.

According to Michigan law, 2 percent ofslot machine revenue goes to the local government, O’Dell said. Thecity would also receive revenue from the city income tax that casinoemployees would pay.

A 2006 study of state revenue from gaming in New Englandfound that New England states receive between 2 percent and 7 percentof their state revenues from gaming. However, contrary to O’Dell’sbeliefs, the study found that permanent casinos divert tourists awayfrom local businesses, making the main form of revenue the casinoitself. The study was conducted by the New England Public Policy Centerat the Federal Reserve Bank of Boston.

Despite the negatives, the Pennsylvania study found that casinos help diversify a region, which can help attract more tourists.

“It adds another dimension of things todo and entertainment,” said Lee Hladki, president and CEO of theGreater Lansing Convention and Visitors Bureau. “The more choice youhave as a visitor, the more attractive that destination is.”

Michael O’Callaghan, executive vicepresident and chief operating officer for the Detroit Metro Conventionand Visitors Bureau, said the three casinos in Detroit “have been apositive aspect for the city.”

“They have certainly attractedout-of-state visitors to the region,” he said. But O’Callaghan alsobelieves that visitors don’t come for casinos alone. He cited the HenryFord Museum, the Detroit Institute of Arts and the success of theDetroit Tigers as examples of other attractions that have broughtvisitors to the city.

O’Callaghan agreed with Fletcher that over-saturating the market with casinos would make each individual casino less profitable.

“There are only so many people in a region who have an interest in gaming,” he said.

Another concern is that the Sault Ste. Marie Chippewatribe — the tribe that is reportedly interested in Lansing — wentthrough banktruptcy at its first metropolitan casino, the GreektownCasino in Detroit. The tribe lost ownership of the casino in 2010 afterit entered bankruptcy in May 2008 with over $755 million in debt, butthe tribe still owns the land. Fletcher said problems with the tribe’sother investors, which were supposed to contribute 50 percent of thecosts, forced the tribe to come up with all the funds itself.

“They started way in debt before theyeven got going,” Fletcher said, but there’s no way to tell if the samesituation could happen in Lansing.

While Fletcher would not comment onwhether a casino should come to Lansing, he said that the positiveimpacts generally outweigh the negative impacts of casinos.

“Michigan needs more economic growth, it needs job growth, and this could be a job creator,” Fletcher said.


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