Where’s the money?

“Where’s the money” is the question facing legislators as they enter the final stages of the 2014 legislative session.  It appears the only ideas for getting more money to balance the state budget is a tax on cigarettes or tapping into the rainy day fund.

Here some ideas that will never fly – in an already election year risk adverse Legislature – along with the strong challenge planned by Republicans to capture the House of Delegates.  But there is 2015 and someone should be looking at and researching the potential of these revenue producing opportunities as well as others.

Internet gaming could open up a world of opportunity.  Only three states (Nevada, Delaware & New Jersey) have legalized this option.  In a recent POLITICO article Keith Smith, who heads Boyd Gaming said, “… online gaming [is] an opportunity to be relevant to a new generation of customers, one that is already playing online.”  The piece noted that despite the murky legal status of online gambling, last year $6 billion of the estimated $15 billion worldwide market came from the United States.

A growing market is Advance Deposit Waging (ADW).  It is a form of betting on the outcome of horse races in which the bettor must fund their account before being allowed to place bets.  State governments receive a cut of ADW revenues.  It is not legalized in our state.

Generally, Advance Deposit Waging companies are licensed in Oregon and are known as “wagering hubs.”  These include well know names like Churchill Downs, The Racing Channel, Keeneland, TVG xpressbet.com and greyhounchannel.com.  Research would tell us how Oregon is taxing this activity.  States have long offered tax relief to attract businesses from other states.  What’s wrong with competing with Oregon for these ADW companies?

Nearby in Kentucky two tracks (Kentucky Downs and Ellis Park) have Instant Racing which are electronic pari-mutuel gaming machines, which rely on the outcome of previously run Thoroughbred races to generate winning numbers.  Kentucky Downs operates 390 machines that grossed $291.2 million in handle and averaged nearly $24.3 million per month in 2013, while Ellis Park’s 187 machines handled more than $27.7 million last year and averaged $2.3 million per month.

West Virginia already allows video lottery machines.  Maybe those thinking about the future should consider Off Track Betting.  Fans in localities where there are no race tracks could have access to simulcast racing across the country and included Instant Racing machines like in Kentucky.

Finally, let’s not forget the growing use of tablets and smartphones.  No doubt these will play an important role in future gaming experience.  These devices must be considered if state leaders decide to look at any of these concepts.

I am offering these ideas not as an advocate but with the hope those wondering “where’s  the money” will put some type of process in place to look for all opportunities – not just gaming – to avoid a certain tax increase for our citizens in 2015 if nothing is done.

Tags:

Leave a Reply