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Anticipating gambling push, API report argues expansion comes with ‘perils and exaggerations’

MONTGOMERY, Ala. – The Alabama Policy Institute this week published a new, lengthy report detailing its position on why expanding gambling is problematic for the state and its future.

Dubbed, “State of Alabama: Report on Gambling,” the 17-page study comes less than two months before the Alabama Legislature convenes for its 2024 Regular Session, when a significant push to legalize, expand and regulate forms of gambling is expected. The stated goal of the report is to “set the record straight on the perils and exaggerations associated with bringing more gambling to our state” so that state lawmakers are aware of “the realities of expanding gambling opportunities to generate supposedly ‘free money.’”

The Alabama Policy Institute is a Birmingham-based non-profit think tank advocating for conservative principles through research and public awareness efforts.  The report, which is available online, was authored by Dr. John Hill, an API fellow and resident scholar, as well as a professor of statistics and communication at Amridge University.

With Alabama now surrounded by neighbors with state-sponsored lotteries, Hill starts there, arguing that, despite their popularity, lotteries are not reliable revenue streams and create a regressive tax for the poor.

Since 2011, the percentage of each dollar devoted to state initiatives has fallen from 34% to 29%, while the percentage of money devoted to prizes has increased from 62% to 67%. Put another way, lotteries must give away more funds as prizes to keep gamblers interested in their games at the growing expense of revenues for states counting on them to balance their budgets, Hill writes.

The report also includes data showing online sports betting, the nation’s fastest-growing form of gambling, is the most addictive and pervasive among young people. Hill quotes The Atlantic’s Stephen Marche’s quip saying “Once there was Las Vegas; now there’s a Las Vegas on every phone.”

Arguing that greater access to legal gambling leads to more addicted gamblers, API’s report estimates that expansion would lead to a drastic increase in problem gamblers: 33% more for casinos, 37% more for a lottery and 37% for sports betting.

API President Stephanie Smith said her organization hopes lawmakers considering a gambling bill will see the report and understand the drawbacks.

“API’s comprehensive report outlines that states that have legalized gambling experience higher rates of gambling addiction, crime, corruption, addiction, and mental health disorders,” Smith said. “Gambling is a bad bet for Alabama families.”

Looking back, looking forward

There have long been pushes to change Alabama’s anti-gambling laws, almost always unsuccessful. Most recently in 2021, a comprehensive bill legalizing a lottery, casinos and sports betting passed the Senate, but got bogged down in the House, where lawmakers couldn’t agree on the final details. That proposed constitutional amendment, as with any gambling plan, would have needed to be approved by Alabama voters in a referendum to take effect.

Alabama Daily News reported that during this last session, new House Speaker Nathaniel Ledbetter asked House members to not bring up gambling legislation given the crowded nature of the session, and instead go study the issue and work on possible legislation in the future.

State Reps. Andy Whitt, R-Harvest, and Chris Blackshear, R-Phenix City, have been among those involved in that study process, visiting dozens of illegal gambling locations across the state. Earlier this year, the two House members told ADN’s Mary Sell that the rampant illegal activity needs regulation.

“We don’t need to expand gambling, it’s already here,” Blackshear said about illegal sites around the state.  “It’s unregulated, the state is getting no revenue from it and if we don’t get a handle on it now, we never will.”

“What does a comprehensive gaming bill look like? I think it’s like school choice — it could mean something different to anyone,” Whitt said. “We want this legislation to be drafted by lawmakers, not special interests,”

Earlier this month, Inside Alabama Politics reported that conversations between lawmakers are ongoing about what should be included in a draft bill. They are also eager to meet with Gov. Kay Ivey and her staff about potential legislation.

The 2024 legislative session convenes on Tuesday, Feb. 4.

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