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Focusing on the Issues – Issue 4

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We’re another week closer to Election Day, and the campaigns for and against the five proposed measures likely to appear on your November ballot are still are making their cases as clear as mud.

And that’s where I come in. Here, once again, to cut through the crap in a feeble attempt to make you more informed come this November, with just a sprinkle of bias and a light dusting of sarcasm. This week, we’ll tackle what’s probably the second most controversial ballot measure in our Bible belt state:  Issue 4, the dreaded casino amendment.

Issue 4

As the second most controversial measure on the ballot, Issue 4 is also the second most misrepresented. (Issue 1 takes the cake on both accounts, obviously)

How’d we get here? Well, organizations that have long supported the expansion of casinos in Arkansas collected more than 138,800 signatures to have the measure certified for the ballot. Of those, nearly 100,000 were found to be valid. They only needed 84,859.

Issue 4, if approved by a majority of voters, would amend the Arkansas Constitution to issue four casino licenses in Crittenden, Garland, Pope and Jefferson counties.

The measure would not create four new casinos. Not exactly. Two of the four licenses would go to Southland Racing in West Memphis and Oaklawn Jockey Club in Hot Springs, both of which already operate gaming facilities. Their licenses would be automatic. The other two gaming facilities in or around Russelville and Pine Bluff would require applications to be submitted, fees to be paid and experience in the industry to be demonstrated.

As we’ve learned with medical marijuana, there will be plenty of people stand in the way of its implementation even if Issue 4 is passed by an overwhelming number of voters.
And as with any issue, there are valid points to be made by those on both ends of the spectrum.

Those who would like to see this measure passed will argue that legalized casino gambling brings jobs to Arkansas. People will spend money in those casinos. Those casinos will, then, use that money to hire employees. Nationwide, there are nearly 2 million casino-related jobs.

They’ll also tell you that casinos attract tourists. And that’s true, too. If you don’t believe me, go and observe all the grandmas loading onto the Grey House bus to head across the Mississippi River to give their money to a Mississippi casino. The same can be said for everyone heading west to Oklahoma casinos. For what little gambling we do have in Arkansas, more than $455 million was collected in revenue in 2016, alone.

To the east and west, north and south, there are gambling states bordering Arkansas. And more than a quarter of Arkansans polled say they travel to these states to partake to the tune of tens of millions of dollars. According to those advocating for Issue 4, legalized casino gambling in Arkansas would keep Arkansas dollars in Arkansas.

And then there’s the matter of tax revenue. If our state government needs anything, (besides a legislative overhaul) it’s a revenue stream that doesn’t involve me paying more in taxes at the cash register, in my online shopping cart or on the 1stand 15th. Casinos, supporters argue, could be our next payday.

And they’re right.

But some of the supporters for Issue 4 have claimed that tax revenue generated from hypothetical Arkansas casinos would be used for the construction and maintenance of Arkansas highways. And boy is that needed. The state is severely lacking when it comes to good ideas for highway funding, and anyone who says they know how we’re going to get there, short of a legitimate tax increase, is lying.

Well, that was the plan… originally. And supporters of the measure have even run ads saying as much. But the measure that’s on the ballot in November allocates no tax dollars for highways.

Under the measure, for each fiscal year, casinos would be subject to a tax rate of 13 percent on the first $150 million in net casino gaming receipts and a rate of 20 percent on net casino gaming receipts exceeding $150,000,001. Net casino gaming receipts are defined in the measure as “casino gaming receipts less amounts paid out or reserved as winnings to casino patrons.”

Per the measure, no other taxes could be imposed on casinos. And that revenue would be distributed to the state’s general revenue fund (55 percent), the city the casino is in (19.5 percent), the county the casino is in (8 percent) and the Arkansas Racing Commission (17.5 percent) – an amount that must be deposited into the purse and awards fund which can only be used for purses in live horse and greyhound racing.

But that’s not to say the state couldn’t use some of their portion for highways. But let’s be real. It’s more likely to be used to recoup revenue that came in under projection.

We’d be remiss if we didn’t discuss the topic of gambling without also mentioning to problems gambling can create. According to the National Council on Problem Gambling, an estimated 50,226 Arkansans were believed to manifest a gambling problem. That’s approximately 2.2 percent of Arkansas adults.

When the state lottery was established in 2009, law makers set aside $200,000 annually for a gambling hotline, treatment services and education programs. In 2015, Sen. Alan Clark saw to it that every cent of that money for gambling problem treatment was eliminated. He said it was a waste. Legislating morality, apparently, is cheaper and more effective.

(It’s not.)

Those who drafted the casino measure considered this, though. They added into the prepossessed amendment a mandatory $200,000 for gambling treatment services. Take the, Sen. Clark.

The biggest organizations fighting for the passage of Issue 4 are Driving Arkansas Forward, Arkansas Jobs Coalition and It’s Our Turn. To date, Driving Arkansas Forward has raised more than $2.2 million, almost exclusively from casinos-related organizations in Oklahoma, like Downstream and Cherokee Nation Businesses. The committee has spent nearly all it has raised, primarily on advertising and petition canvassing.

Arkansas Jobs Coalition has not reported any monetary contributions. They have, however, reported hundreds of thousands of dollars-worth of nonmonetary contributions from Downstream and Driving Arkansas Forward. The contributions were earmarked “canvassing.”

It’s Our Turn filed their statement of organization with the Arkansas Ethics Commission just last week.

The organization leading the fight against Issue 4 is the Family Council, which has not yet reported any contributions.


In Cash & Candor, Arkansas Money & Politics / AY Magazine Editor Caleb Talley aims to shoot it straight when it comes to business and politics in and around the Natural State. Talley comes to AMP by way of the Arkansas Delta, where he called balls and strikes at the Forrest City Times-Herald. He can be contacted by email at ctalley@aymag.com. Read more Cash & Candor here

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