Category Archives: gambling

A Museum is Dying—And We Should Be Ashamed

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Something more important than Kansas City sports stadiums has come up so I’ll wait to encourage some thinking about that issue until later.   An announcement late last week takes precedence—the planned closing of the Steamboat Arabia museum in Kansas City.

Some readers of these entries know that for almost eight years I have been trying to convince the Missouri General Assembly to keep this irreplaceable historical resource from closing and probably leaving our state.

We have tried to convince the legislature to meet its responsibilities to the people of Missouri by updating an important part of our gambling laws—the casino admission fee. One part of that proposal would have that industry finance a new home for the Steamboat Arabia Museum in Kanas City—or in some other city as long as it stays in Missouri.

But the legislature has refused to end the multi-million dollar scam gave them more than $60 million in unearned profits in the most recent fiscal year, weakened the financial ability of the Missouri Gaming Commission to regulate it and, even worse, has brought our system of seven state-operated veterans homes to the verge of closing one of those homes.

Last Thursday, the Arabia Museum announced that it would be closing a year from now. Many of you know what an incredible experience the museum provides in telling the story of life in Missouri and on the frontier five years before the Civil War.  There is nothing like this museum anywhere.

For those unfamiliar with the story, here it is.

The Steamboat Arabia, bound upstream to deliver winter supplies to sixteen then-small communities and outposts struck a submerged log above Kansas City and sank withing half an hour, taking 200 tons of cargo with it. The boat sank into the soft river mud so quickly that the cargo would not be recovered—-until the winter of 1988-89 when five men located it in a Kansas farm field a half mile away from the present river channel.  They went far in the hole financially and realistically, finding the wreckage fifty feet down and recovering the entire cargo that had been perfectly protected from the deteriorating effects of light and air.

They decided their discovery was too important to be sold and three years later opened the museum that has never take a dime of government funding but has given hundreds of thousands of visitors an unequalled window into the mid-19th century and how our ancestors lived.

I invite you to look at a video at 1856.com to get a taste of what is and what can be—if the state steps in and for once does not allow itself to be influenced or intimidates by a predatory industry untruthfully claiming to be a good corporate citizen.

Our plan has been to increase casino admission fee, set at two dollars per person in 1993, to contemporary dollar values with part of that money going to finance a new building for this incredible historical resource.

Why the casinos?  Because the very existence of casinos in Missouri is based on our riverboat heritage. The industry never promoted “casino gambling” in winning voter approval for it in 1992.  Instead, it promoted “riverboat gambling,” avoiding the red-flag word that might have incited increased opposition.  We still see the results of that campaign in our laws and in our Constitution where casinos are called “excursion gambling boats.”

Thirty years of inflation have greatly increased the contemporary equivalent of two dollars in 1993 money to $4.56 as of September, 2025.  So it is that the state and host cities still split the two dollars for each admission but the casinos keep $2.56. However, inflation works both ways by lowering the buying power of the two dollars they do receive. Two 1993 dollars have the buying power now of 90-cents.

The admission fee is equally split between the gaming commission with its worthy causes that include veterans nursing homes, and the casinos’ host cities.

These calculations mean that the host cities of our casinos are getting 45 cents in today’s valued money while the casino on the riverfront of those cities is making $2.56.  That is not how the legislature thirty-some years ago planned for the situation to be.

These are the five men who spent a cold, wet, muddy and miserable four months digging down to the Arabia and recovering history as it really was lived in 1856 on the frontier.  Two of them have died—Bob Hawley and the older of his two sons, Greg, (the left of the two men in or near the cab). The other three are (L-R)_ Jerry Mackey, Dave Hawley, and David Luttrell.

These five men decided their findings were too important to be sold. They have protected the museum and its teachings and dreamed of expanding it to include, among other things, an entire boat that might have escaped extensive damage in its sinking.

The dream is fading and the museum will disappear if private philanthropists or philanthropic organizations do now act quickly to raise money and if the legislature continues to let the casino industry dictate what state policy will be for that industry.

I have compiled almost 200 pages of charts, tables, and other information showing how this industry, not the legislature nor the gaming commission, is serving the general public as it should.

One of the sad facts accompanying the situation is that the Missouri Gaming Commission has let all of this happen without public comment even as it has watched its own financial resources decline because of decreasing admissions and the decreasing value of the funds the casinos have agree to let it have.  It publishes an annual report but never has put the industry-supplied numbers in any context that would tell the public how the industry has annually mugged the state.

In the most recent fiscal year, the casino industry kept $64.1 million in unearned income that would have stayed with the state and the host cities if the admission fee had been adjusted for contemporary values.  Because inflation also has diminished the purchasing power of the money the casinos DID pay, the state and the cities lost another $30 million.  The lost revenue/unearned profits are on track to be a nine-figure amount this year.

Maybe, now that the museum has announced its planned closure, enough members of the legislature will recognize the seriousness and the urgency of this issue and will find the courage to meet their responsibilities more to the people at home than to the casino people in the Capitol hallways, and will provide funding to keep that museum open and in Missouri.

Leavenworth, Kansas has made a strong offer and the state of Kansas is supporting it.

This is make or break time for Missouri. Frankly, I am pessimistic. I do not believe our legislators have the will to act in the people’s interests rather than the gambling industry’s interests.

All of the numbers I have cited here, and much more, are from a lengthy study, year by year, of how the industry has exploited a flaw in the original admission fee law and now refuses to let the legislature fix it.

Do not misunderstand me. The Missouri General Assembly seems incapable of exercising its policy-making authority on this issue.

The situation is more desperate than ever. The clock is ticking at an increasing rate. The people must act, whether it is in pressuring their elected officials or seeking out those with philanthropic sympathies.

We cannot lose this museum.  We will lose a major part of ourselves and of our history if we do not act now.  As we view the situation at this hour, though, Leavenworth and Kansas will not so much gain the museum as Missouri and Jefferson City will shamefully abandon it.

If you can help or if you know someone who can offer major help, we will be giving ourselves history—and saving history is a reward in itself and a legacy of this generation to generations we will never know.

There’s another video I hope you will watch— One Last Chapter: The Arabia Steamboat Museum.

You know what’s worse than personal disappointment?  The feeling that Missouri will have let down the dreams of the five men who gave us this incredible gift recovered during those cold, wet, muddy months in the winer of 1988 and ’89 because it puts the will of the powerful few above the benefit of the common many.

I’m not sure how much I can believe in the state motto very much:

“Let the welfare of the people be the supreme law.”

Pimples

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Back in the Twentieth Century, when your correspondent enrolled at the University of Missouri, male freshmen and sophomores were required to enroll in what we called “rot-see,” more properly, ROTC—the Reserve Officers Training Corps.  Two years of military education designed to encourage students to join the Army, Navy, or Air Force after two more years of military education.

I decided to focus my energies on becoming a journalist.

One of our instructors in Crowder Hall, a Sergeant whose name I might be able to recall in the middle of the night, once referred to Fort Leonard Wood as “a pimple on the ass of humanity.”

I think of him almost every time I walk into a convenience store and see a line or two or more of machines that are or are not slot machines (according to their owners) but are instead Video Lottery Terminals.

Owners of the machines say they’re legal because there aren’t slot machines that are state-regulated. The casinos, which want a monopoly on all things gambling (except the state lottery that they can’t lay their hands on, so far) say they are slot machines and state law allows only casinos to have legal slot machines.

The question of their legality tied up the Missouri Senate so badly that for three years in a row that almost no legislation was passed except for a state budget. Most of the instigators of that deplorable era have moved on or moved out, allowing the legislature to actually accomplish several things for good or for ill in the most recent regular session.

The legacy of those deadlocks is Amendment 2, the sports wagering proposal barely grafted onto our state constitution last November that will have almost no benefit to the citizens but will greatly fatten the pocked of casinos and our sports teams.  Backers of legalized convenience store slot machines refused to let sports wagering legislation, or almost any other legislation, go anywhere unless those bills also legalized the slot machines.

The backers of the VLTs, therefore, are largely to blame for Missouri now having a constitutional amendment rather than a law.  Laws are easier to correct or to make more fair for the people of the state than amendment is.

The casino industry also is largely to blame because it refused any kind of a compromise. The legislature refused to be the adult in the rooms (the House and the Senate) and put it collective foot down and resolve the issue in a way that protected the state’s interests.

The stage is now set to decide in the court system if those “gray market” machines are or are not legal.   A few days ago, a St. Louis federal jury ruled that the biggest supplier of those slot machines has been engaging in unfair competition and has misled players and stores about how the games operated.

The jury had no trouble deciding—in only two hours after a five-day trial. The owner of traditional bar games had sued Torch Electronics and won a half-million dollars, four times what was sought.

The jury’s finding could clear the way for Federal District Judge John Ross to rule whether these machines are legal. He has indicated a reluctance to wade into the “politically fraught” waters involving this issue but indicated he would rule after the Torch case was decided.

Gambling generates a lot of Money in Missouri and it’s important that those in the biz make sure those who make decisions on laws and regulations are friendly.

Tthose who make that money have not been shy about buying high-level political friendships with it, thanks in large parts to the financially-persuasive involvement of former House Speaker Steven Tilley, now an influential lobbyist who has endeared himself to key figures such as Governor Kehoe, whose political action committee account was fattened by a quarter-million dollars last year, and former Attorney General Andrew Bailey, who kept Torch money and who backed away from defending the Highway Patrol—which had been sued by Torch to keep it from seizing machines.

Bailey’s predecessor, now-U.S. Senator Eric Schmitt, returned $5,800 in campaign donations from Torch’s owners after questions were raised about possible conflicts of interest. State Treasurer Vivek Malek, after a Tilley-arranged meeting with Torch’s owner, put stickers on the VLTs advertising the state’s unclaimed property program, which had nothing to do with those machines but drew criticism from those who thought they indicated the state had licensed them.

The St. Louis Post-Dispatch reported that the plaintiff’s attorney in the case told the jury that 101 of Torch’s 6,000 machines throughout Missouri took in $32 million in seven years and generated $11million in profits to Torch, a payout rate of about 65% while regulated casino slots pay out more than 90%. No law requires operators of those machines to share their wealth with state programs and services.

There has been a general reluctance by city and county prosecutors to declare the machines beyond the law. One county and one city have taken that step but a ruling by Ross of illegality could give others the backbone to challenge the machines’ presence.

Regardless of how Judge Ross rules, the conflict about whether they are or whether they aren’t slot machines has left Missouri with an unfortunate result.  Sports wagering is now in the Missouri Constitution rather than in the Missouri Revised Statutes.  Putting something in the Constitution doesn’t make it immune from change but the opportunity for constitutional change is much harder than it is to change a law.

Regardless of how Judge Ross rules, Missourians are losers because the people we elected to represent us in the Capitol didn’t do their jobs in voting video lottery machines legal or illegal and failed to pass a sports gambling law that serves the people.

You might ask them why they lacked the backbone to put the state in control of the gambling industry rather than the other way around. Check their campaign contribution reports on file at the Missouri Ethics Commission and you might find some answers.

Your Vote Won’t Mean a Thing OR it Might Mean Everything

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—if the legislature passes a crazy initiative petition reform proposal suggested by Governor Kehoe.

Gerrymandering our congressional districts to eliminate one of our Democrat members of congress—because President Trump wants no congressional limits on his power—is not the only threat to our republican (small “r”) form of government on legislators’ desks in the special session.

It is widely recognized that the petition process by which citizens can demand a new law be passed (because the legislature won’t pass it) has its problems and it has its perils that arise from mass expenditures of money to, in effect, buy part of our Missouri Constitution or part of our state statutes.

But a proposal that means 7/8 of Missouri’s voters’ ballots will have no meaning whatsoever is simply absurd.

The governor wants a law passed that says any proposal put on the ballot by citizen petition not only must achieve a majority to pass, it must get a majority in every one of our eight congressional districts.

One of the problems with the current process is that votes in our heavily-Democratic metropolitan areas have been enough at times to pass a proposal opposed throughout the rest of the state.

Governor Kehoe did not address that issue in announcing his recommendation in issuing the call for the special session. He said, “For far too long, Missouri’s Constitution has been the victim of out-of-state special interests who deceive voters to pass out-of-touch policies.  It’s time we give voters a chance to protect our Constitution.”

The answer to this problem is NOT, however, in killing a sacred part of this country—majority rule.

If Governor Kehoe’s idea had been in effect last year, we would not have sports wagering coming to Missouri regardless of how many millions of dollars the gambling interests spent. You’ll recall that the industry spent more than $40 million to get its petition issue passed by 3,000 votes. The industry fits like a glove the governor’s description of “out-of-state special interests who deceive voters.”

The proposal lost in three counties that have casinos—Lewis, Cooper, and Cape Girardeau. It carried in the metro areas that have casinos by tens of thousands of votes. Only one outstate county with a casino—Pemiscot—approved, but by only about 340 votes. It failed not in just one congressional district but probably in five (we haven’t seen a breakout according to district but the county-by-county plus St. Louis and Kansas City totals are available).

This is a ridiculously BAD idea.  Under this idea, a petition-proposed law or amendment could pass in seven of our congressional districts but fail by a single vote in the eighth. That single vote would negate every other vote in every other part of the state.

The proposal deals with a problem that is largely of the legislature’s own doing. By refusing to pass bills that have significant public support, our lawmakers are clearing the way for citizen petition campaigns. Sports gambling is the biggest and most recent such failure. The refusal to pass a law has led the gambling to put sports wagering in the Constitution and therefore make in extremely hard to deal with the problems this new form of gambling cause by changing a law. If it’s in the constitution, correction is manifoldly more difficult.

Here’s something else that’s kind of tragic—

This proposed law does not require a public vote.  You and I will have no right to vote on whether the state should be able to take away our votes, even if we are in the majority, at least not as the proposal is now written.

Law by petition has its problems.

Such laws do not go through the rigorous examination and refining process of legislative procedure. That can be frustrating for those hoping for a change in something. But writing a law that says specifically what it is meant to say, no more and no less,  is a finely-developed talent. Once it is written, it goes through committee hearings where shortcomings can be highlighted and corrected. Then in each chamber of the legislature, it goes through a “perfecting” process that again can be a rigorous review before it is finally passed.

But that doesn’t mean the right of petition given us by our ancestors more than a century ago should be rendered meaningless by this proposal.

The system does need some careful tweaks, but not surgery by meat cleaver. One tweak is a requirement that entities wanting to put a petition issue on the ballot should file only one version of the proposal with the Secretary of State whose elections staff spends time reviewing for correctness.

The Secretary of State’s web page has numbers that dramatically point to the problem. Last year, 174 petitions were filed. Nine were rejected, 24 were withdrawn, and 139 were approved for circulation. Only four were submitted with signatures and put on the ballot. Four out of 174. Large numbers were slightly different versions of the same matter. But each required review by the Secretary of State staff.

A law saying a group gets one shot would be helpful. If there are problems, then the group can submit a better proposal. But the shotgun approach needs to stop.

Secretary of State Denny Hoskins has some ideas about improving the process:

Limit abuse of process, by instituting modest filing fees and banning duplicate or near-duplicate submissions.

Ensure broad geographic support, strengthening the constitutional “district distribution” requirement so that petitions reflect statewide, not concentrated, backing.

Ban foreign or out-of-state fundraising, and stiffen penalties for fraudulent signatures or circulator misrepresentations.

Increase transparency, with public comment periods and clear, plain-language explanations available before signature gathering begins.

Generally, these aren’t bad ideas although the funding ban might be a little shaky because of  First Amendment speech problems and whether limits on raising the money to do the speaking infringes on the right to petition by groups who say they can’t enjoy that right unless they can raise money from whatever source.

The secretary’s idea, however, of allowing one congressional district to be, in effect, a killing entity that makes votes in all of  the other districts meaningless is simply undemocratic.

These are statewide issues and the votes from throughout the state mean something today. But they won’t tomorrow if this proposal passes. “Broad geographic support” sounds good. But it’s shorthand for “forget majority rule.”

Missourians already have given up their right to vote. Twice. First, it was term limits that means we have no right to vote for a lawmaker who has served us well and that we would like to represent us for more than eight years. Second is the adopted initiative petition proposal requiring votes every five years in Kansas City and St. Louis on whether to continue their earnings taxes. One provision of that issue says none of our other cities can ever ask voters to approve a similar tax for their city. Proposals might not pass, but we have a law—again, submitted by initiative petition—that says we can’t even vote on it.

Now we are being asked to approve an idea that says a statewide majority is useless if one-eighth of the state, by as little as one vote, can wipe out the votes of everybody else.

The governor’s plan doesn’t take onerous amounts of money out of the process. Doing so has to be through a way around First Amendment protections of free speech and right to petition. Nobody has figured out how to do that in a way that the court system will buy.

A undemocratic proposal that says votes from 7/8 of our state can be rendered meaningless by the barest of majorities opposed in one district is just plain wrong.

Suppose we applied the idea to legislative races saying no one can be elected to the House or the Senate if one precinct in their district fails to give them a majority. That’s “broad geographic support” brought home to roost.

If they’re not willing to put themselves in that predicament, they shouldn’t put everybody else in the state in it.

 

What’s Next: Part Two—The Looming Threat

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Greg Olson is a terrific historian from Columbia who has a deep interest in the 12,000-year history of the people who were here long before the Europeans showed up for commercial, more than religious, purposes to exploit, conquer, and subjugate them.  His newest book is a voluminous report on Indigenous Missourians; Ancient Societies to the Present. He presented part of his research in the July, 2021 issue of the Missouri Historical Review, the quarterly publication of the State Historical Society of Missouri.

He points out something few of us realize. When what is now Missouri became American Territory with the Louisiana Purchase Treaty, the United States did not really get very much. He wrote, “When Missouri was admitted into the Union in 1821, only three Indigenous nations, the Sacs, Foxes, and Osages, had ceded rights to any property inside the state. In all, it would take thirty-four years of negotiating twenty-two treaties with thirteen different Native nations before the United States finally established clear title to all the land inside Missouri in 1837.”

Remember that figure: thirteen different Native nations.

That’s where a possible threat to our thirteen commercial casinos could lie.

In October, 2021, the Osage Nation announced plans for a $60 million casino/hotel complex on 28 acres of land at the Lake of the Ozarks on land it claimed as ancestral lands, part of the territory covered by the Treaty of Fort Clark. An application was sent to the U. S. Department of the Interior for approval under the U. S. Indian Gaming Regulatory Act. The Osage Nation asked to transfer the land into a federal trust with tribal sovereignty rights granted, clearing the way for a casino that will be exempt from Missouri laws and regulations.

The defeat of Amendment 5 has no impact on the proposed Osage casino except that it eliminated competition from a commercial casino.

Editor Shannon Shaw Duty wrote in Osage Nation newspaper in September, 2021 that Principal Chief Geoffrey Standing Bear already was looking for a second, similar piece of land to buy for construction of another Osage Nation tribal casinos. “Tell the people of the United States that this is our homeland, this is our legally recognized homeland. There are treaties in place that we did not fully agree with that drove us out of there and we want to claim those properties,” he said.

The American Gaming Association says the United States has 352 land-based casinos, 266 tribal  casinos, 66 boats and 50 racinos. Fourteen states have only tribal casinos. The states with the most tribal casinos are Oklahoma (140), Arizona (85), Minnesota (40), and Washington (35).

Although tribal casinos are not regulated by the states, they cannot operate without an agreement, or compact, with each state. Oklahoma has compacts with 35 tribes. Its model compact is at Microsoft Word – Model Compact.doc (ok.gov).

A summary of Arizona’s 24 compacts can be found at KNXV-TV, Phoenix’s website: https://www.ok.gov/OGC/documents/Model%20Compact.pdf

Minnesota’s compacts are at: Gambling – Tribal State Gaming Compacts (mn.gov) Washington’s compacts are at: Tribal gaming compacts and amendments | Washington State Gambling Commission.

Missouri’s commercial casino industry and other tribes likely are all paying attention to the fate of the Osage Casino at the Lake of the Ozarks. Given Missouri’s history of First Peoples occupation and the lengthy period of treaty-making with thirteen nations, it would not be surprising that success at the Lake of the Ozarks could trigger a push by other Native American Nations to build tribal casinos throughout Missouri in areas not tied to the Missouri and the Mississippi Rivers, a constitutional limit on the commercial casino industry.

Such developments, of course, would provide unwelcome competition to the existing casinos and could provoke significant developments in lesser-populated areas or other parts of Missouri untouched by commercial casino gambling. The situation is fertile for speculation.

Tribal casinos in the vicinities of Highways 36 and 61 would threaten the state’s smallest casino at Lagrange. A tribal casino at 36 and 63 would serve a large, unserved, part of north Missouri and would draw some business away from LaGrange and Boonville—which already might have lost southern constituents to the casino at the Lake of the Ozarks—and one at 36 and I35 would threaten the casino at St. Joseph. A casino at Highways 60 and I55 would threaten casinos at Cape Girardeau and at Caruthersville.

Only Kentucky and Tennessee of our surrounding states do not have Indian casinos. Iowa has four; Nebraska five; Kansas seven; Arkansas 2. Oklahoma has 143 Indian casinos operated by 33 tribes. The casino industry is considered the second-largest industry in the state. Revenues generated at Oklahoma Indian casinos is second only the revenues generated by Indian casinos in California.

How Native American Tribal casino gambling would mesh with cultural/religious concerns and regional economic needs could become a long-term storyline.

All that we have written in these two entries is entirely speculation.  But casino gambling is changing in numerous ways and the people of Missouri and those we send to the general assembly need to be aware that they will be asked to take actions of some kind—and those in the decision-making roles should understand where their responsibilities lie.

Amendment 2 might be just the start.

The Ones Most Interested  

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—and the places most damaged.

We’ve had three weeks or so to digest the results of the November 5 election.  We are going to offer some insights in the next few entries.

One of the amendments we voted this month proposed something that we’ve seen before—a statewide vote to force a city or an area to allow something the people there did not want.

That was Amendment 5, which would have forced the people living and working at the Lake of the Ozarks to accept a commercial casino in their midst.  Two areas of Missouri were involved: the area where a casino is proposed and an area fearful that it would be the next place forced to accept one.

We’re talking about the Lake of the Ozarks and Branson.

It might be instructive to see their thoughts about the sports wagering amendment and the casino-placement amendment. We looked at the votes in five lake counties and in five Branson-area counties.

Both groups wanted nothing to do with either proposal, sports wagering or a casino.

The five lake counties were 57% against sports wagering, Amendment 2, that barely passed statewide with only 50.074% of the votes (as of last night), a margin so small a recount can be justified if the losers want to pay for it.  The five Branson-area counties opposed it to the tune of 60%.

Amendment 5 was the issue that was most stark in its possibilities for these two areas and the message sent by these ten counties was more than no. It pretty much amounted to a “Hell, No.” Camden County rejected the proposal 10,621-14,375. Taney County swamped it 9,875-16,071.  Sixty percent of the voters in the five lake counties rejected the casino. In the Branson area, the rejection was even greater, 61.4%.

End result: People in those ten counties don’t like sports wagering but their people can do it if they want, but they’re sure don’t want them ever to do it in a local casino.

Both of these counties have promoted their areas as family-friendly tourism destinations.  Branson was worried that a Lake of the Ozarks casino would be the precedent-setter for a casino campaign in Branson. Amendment 5 would have forced one area to accept something the voters clearly did not want, and exposed the other area to a similarly unwelcome intrusion later.

Branson had a taste of this issue twenty years ago when voters defeated a proposal to put a casino next to the White River at Rockaway Beach.

How about counties that have casinos?  Amendment 3 failed in three of them—Cape Girardeau (46.4%), Lewis (Mark Twain Casino in LaGrange—46/7%), and Cooper (Boonville 48.5%).

This time, the casino industry spent ten-million dollars on a petition effort and an election campaign for Amendment 5.  Their efforts netted them less than 48% of the statewide vote.

In St. Charles County, the home of Missouri’s most lucrative casino, Amendment 3 got only 53.4%.

The spending on the Lake of the Ozarks proposal was pocket change compared to the huge amount invested in the sports wagering amendment. It took $41 million from the two biggest internet bookies to overcome the $14 million dollar opposition campaign financed by another bookie. The victory margin was only (as of last night) 4,360 votes out of almost three million votes cast.  The certified final results will be posted after the Missouri Board of Canvassers meets on December 10.  Presidential electors meet a week later. Congress is to certify the federal results on January 6.

The casinos will get their money back pretty fast.  The host cities of the casinos will lose millions because of the support their voters game to Amendment Two.

How much will they lose?  There are two factors.  The state tax rate on gambling (table games and slot machines is 21%.  Host cities get ten percent of that amount. In the last fiscal year, ten percent of the state gaming taxes collected provided $39,711,780 to the host cities.

But sports wagering will provide ZERO money from the state gaming tax, which will be only ten percent to begin with.  The State Auditor estimates casino revenues in the first five years will be $1,044,684,612.  The states ten percent will amount to $104,467,878, all of it earmarked for higher and lower education. None of it goes to the home cities. None.

If Amendment 2 followed current law, the casinos’ own home dock cities would split an additional $10,446,788.

But it’s worse than that.  If the tax rate on sports wagering were the same as it is on other forms of gambling—and the industry has never given a consistent answer why is should not be—the home dock cities would have split an additional $21,938,377 in those first five years.

The casino industry will recover more than one-half of the money it spent on the campaign by giving their own host cities the shaft. Permanently.

I can show you the math; the casinos wouldn’t.

The manifest shortcomings in taxes can only be remedied by adoption of another amendment. A campaign that focuses on those shortcomings and either corrects or overturns Amendment 2 might be considered, given the paper-thin margin of victory for sports wagering. It would be interesting to know the reactions of city councils in the thirteen host cities if they are ever shown these numbers. I doubt the industry, its leaders, or its supporting organizations have ever given these figures to the cities

The casino industry has never been put on the defensive at the Capitol or at the ballot box.

And maybe it should be, as we will discuss in our next commentary because what could be coming will be only worse.

What Next? 

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The casino industry spent a record $41 million dollars to convince few more Missourians to vote in favor of sports wagering than voted against it—very few—out of about three million votes cast.

It will be a mistake to think the industry is satisfied with the sweetheart arrangement voters approved. The casino industry is changing rapidly, and the legislature and the voters need to be preparing for the next change in law that will benefit casinos and disadvantage the state, our schools, and their own host cities.

We don’t profess to be an expert or some kind of Casino Nostradamus, but we have been studying this industry and its proposals for several years now. It is not hard to find industry and scholarly articles pointing to a much different industry materializing in the next ten years or less. The casino industry is being altered by demographic changes. But rapidly changing technology will let the industry respond to those demographic changes.

Amendment 2 was just the first step. The policy set by Amendment 2 is likely to be the template for state policy as casinos move increasingly to remote betting on ALL gambling offerings.

We know from experience that technology often moves faster than the development of reasonable and fair regulation of it, making this a time for correction of shortcomings of the past coupled with anticipation of problems in the future. The state will be well-served by a adopting a policy of correction and anticipation, although there is considerable doubt that such a policy will be enacted a Missouri Legislature that is heavily influenced by industry pressure and largesse. Whether voters who can be wooed by absurd amounts of money spent on advertising that is low on the honesty scale would approve a policy unfriendly to the casinos is problematic.

A couple of years ago, Joey Richardson wrote for Gamblingsites.org, “(Casinos) are going to need to change what they offer and how they offer it if they want to continue to attract new customers.”

Millennials who have grown up on video games and who learned during the pandemic how to live their lives without leaving their homes already are having a major impact on the future of businesses of all kinds. Past discussions of internet sales taxes as a meager protection for brick and mortar businesses were one of the beginnings of this trend that gained momentum in the pandemic era when working from home became viable.

Hoosier Park Racing & Casino in Indiana became one of the first casinos to have a Pac-Man video slot machine, in September of 2017. Blackjack revenue for casinos is about half what it was in 1985 when it was responsible for 85% of table game revenues. Richardson noted in his article that casinos already had brought in new games to fill the gap—Caribbean stud, Three Card Poker, and Casino Holdem among them. All can be played remotely—if laws are changed to allow it.

Although Richardson doubts brick and mortar casinos will die out, Mehul Boricha, at Techrival.com has suggested virtual reality casinos could be on the way. He wrote, “Rules and regulations will always continue to influence future casinos. Various regulatory bodies come up with new and stricter policies that online casinos and games have to adopt without losing their grip on their innovation and creativity.” The new world of casino gambling that is being born in front of us will be a challenge not only to tomorrow’s legislature but to the gaming and lottery commissions that will have to regulate it. The gambling industry prefers not to make or be forced to make an investment that will allow regulatory bodies to prepare for the changes they must make to balance public responsibility with private profit.

Marketing Manager Emily Rodgers with driveresearch.com reported on August 2, 2023 that the growing preference for online or mobile app betting among three-quarters of sports bettors indicates a significant shift in the gambling industry towards digital platforms, offering convenience, accessibility, and potentially contributing to the overall increase in sports betting activity worldwide. She says convenience (78%) and easy deposits (75%) are the top reasons people prefer online/mobile sports betting. She argues that these top factors highlight the importance of user-friendly and seamless platforms in the gambling industry, factors that not only attract more bettors but also contribute to increased customer retention and engagement. She says digital channels are in the future for casino gambling, beginning with sports wagering..

Online sports betting revenue is expected to grow at a compounded annual rate (CAGR) of 10% during the next 5 years.

The introduction of AI (artificial intelligence) in sports betting will undoubtedly have a profound impact on the industry. One example is the way systems record information in digitized ledgers  known as blockchain, which is being adopted globally. Blockchain applications will help automate real-time data, expedite payments and wagers, and provide in-the-moment security and monitoring – including cryptocurrency transactions that are not allowed in Missouri, yet.

The sports betting marketplace grew ten-fold from 2019 to 2021 while netting nearly  $7B in revenue from $83B in total bets placed on sports in 2022.

Another report by marketdecipher.com revealed similar findings. In fact, its estimated $85B in bets placed in 2023 is forecast to balloon to $288B total by the end of 2032.

Virtual reality sports betting took a step forward with the launch of the VR22 sports betting  platform last October. The service allows users to take in a 360-degree live gaming experience as if they were there in person. Users can interact with the game or match in real time including the ability to place wagers down to a specific play – and even purchase merchandise or NFTs.

Missouri already has remote betting although it has been on a small scale.  In the past several years, a few of our casinos have had what they call “hybrid” wagering.  If a table is too crowded to allow additional players, gamblers are referred to a computer terminal that lets them place bets at the table as if they were physically there. It has been done on a small scale and has generated generally small profits. But it’s an experiment and it works.  Whether the terminal is fifty feet from the table or 50 miles and at someone else’s table, it is still sports wagering. And it is part of gambling’s future.

Another reason present casinos need to reach the public where it is, instead of waiting for the public to come back, is the threat of widespread competition. It is a very real threat and the first part of it could be in business in a few years.  We’ll talk about that in our next edition.

Winning for Missouri: More Like the Mugging of Missouri 

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One last shot at Amendment 2 before next Tuesday’s vote on it. And a warning that this amendment might have far-reaching results that have gone unnoticed.

Unfortunately, these considerations are being offered to late to be circulated enough to make a difference. But let’s put the issues on the record. Or at least, this person’s perspective.  Disagreements are welcome in the box at the end of this entry. We’ll talk about the casino industry’s efforts and we’ll discuss some sports teams questionable claims late in this post.

A key part of the proposed amendment is the sports wagering tax rate—10% —a back door tax cut of about 25% for all forms of gambling.

And here we must note that later we will discuss a clause in the proposed amendment that can lead to later mischief that will further disadvantage the state and its people.

The industry-supported legislation has never defined sports wagering as a special category.is listed as just another kind of game of skill.  In the lengthy list of those allowable games, it has been inserted after “Double down stud” or “any video representation of such games.”

It is that last clause that nobody has talked about.  But it’s important for future developments in the casino industry.  Here’s why.

People are not going to casinos as they once did.  The generation that has spent hours at the slot machines and the tables is dying off. Admissions are almost half what they were a dozen years ago or so.  As this trend continues, the casino industry must find ways to get customers to play these games. If they won’t go to the casinos, the casinos must—in effect—take the games to the consumers. This amendment is a template for later proposals to expand remote wagering to other forms of gambling.

This amendment legalizes remote betting in our casinos for the first time. Some of our casinos already have tested a version of remote gaming within the casinos, calling it “hybrid gaming.” In those casinos, customers who can’t find room at their favorite gaming table have gone to a nearby computer terminal, have set up their account, and have placed bets at the table as if they were there.

The tests haven’t generated much revenue. But the system has been tested.  No matter what the industry calls it, whether it’s fifty feet from the table or fifty miles from the sportsbook, it’s remote wagering. Don’t be surprised if casinos become more involved with it.  And that phrase is going into the constitution if voters approve Amendment Two.

We are not sure if that phrase in the amendment will mean casinos can offer remote betting on table games and slot machines without more legislative action. But it would not be in the proposal if the industry did not have a reason for it being there.

The Casino industry cleverly set the parameters for the discussion of sports wagering early:

—We can’t do sports wagering at 21% (the rate the state established more than three decades ago for table games and slot machines (incidentally, about 85% of casino revenues come from the slots).

—Sports wagering is different from other forms of gambling and needs special treatment.

Neither statement is true.

The industry has consistently claimed sports wagering is unique and requires its own special betting area and its own special tax rate, the latter reason justified differently year-to-year in bills introduced in the legislature.  The first bills proposed a tax rate of 6.25% (the lowest in the nation), 6.75% (the present low), 8%, and 10%.  The industry has seemed to have trouble sticking to its story when advocating a tax rate of less than 21%.

A couple of years ago the Senate tried to make the rate 12% and there was talk that the casinos would compromise on 15% because it was the average of the states around us.  We’ll get to that in a little bit.

The truth is that sports wagering is just another item on the gambling menu and its presence on that list supports that point. But the casinos have tried to get the legislature to believe it is special. And they want voters in a few days to believe it, too, so they can get a cut in overall tax rates (by our calculation) of about 25%.

The industry has never produced any independent studies in any legislative hearing we have attended, to justify the claim that sports wagering is a fragile flower needing lots of TLC, including the low tax. None of the pro-amendment advertising has offered any justification for it either.  And the voters, who understandably don’t closely follow the policy-making, or lack of it, by the legislature are left to make decisions based on thirty-second television commercials of questionable verity.

One industry argument has been that casinos will spend a lot of money establishing a unique area where the sports wagering can take place, an argument that falls apart because all forms of gambling have THEIR unique betting areas.  It’s why you can’t roll dice at a blackjack table. You can’t play poker at the roulette wheel table. You can’t play craps at the poker table and you can’t bet on where the ball will land on the big wheel at the Texas Hold ‘Em table.

There is nothing inherently unique in sports betting, regardless of industry claims. It operates the same way as other forms of wagering.  The consumer has money; the casinos have a system that will take all of it through time. The player at the poker table places a bet. So does a bettor in the sports betting area. The casino processes the bets, paying the winners and keeping the losers’ money. At the end of the day, the casino proceeds go into the same bank account with the proceeds from table games and slot machines.

Every year, the industry seems to have changed its justification for a sweetheart tax rate, raising a simple question that should been asked but never was: “How can the industry’s claims be trusted if it cannot stick to its own story?

In 2019, the industry demanded a 6.75% rate because “that’s what they charge in Las Vegas.”  A quick review of the Nevada gaming laws showed something the industry avoided telling our lawmakers: that 6.75% ALL forms of gambling in Nevada.  The industry also neglected to tell the legislators that the Nevada gaming law allows no deductions and no carryovers of casino losses from one month to the next, as is proposed in Amendment 2.  It was pointed out that the Nevada template would mean that Missouri would have two choices: either lower its present tax rate to 6.75 so all forms of gambling would be treated uniformly or to charge sports wagering a 21% tax.

Here are other reasons offered for a low tax rate:

—The casinos need to keep the extra money to properly promote and advertise this unique form of gambling. A representative of Penn National Gaming told a House committee in 2022 that a higher tax would hinder Missouri’s ability to compete with illegal gaming sites. He said, “When you are able to spend more in marketing, you are able to drive more in volume and revenues.”

The position of the industry that money should be taken away from the education fund and from home dock cities to subsidize promotions and advertising was questionable when the industry was generating revenues of about $1.7 billion at the time. Wouldn’t you think the industry should pay for its own promotions and advertising?

A critic argued that there is no reason the state should subsidize advertising for an industry of that size by reducing funding for the school systems and home dock cities (ten percent of the gaming tax goes to the thirteen host cities of Missouri’s casinos).  Additionally, major betting companies already were advertising on professional sports broadcasts and have stepped up their advertising since.

The proposal for using money traditionally earmarked for the education fund to publicize and promote sports wagering included no accountability language that would have required casinos to show the money actually had been used as proposed instead of just pocketed.

They also claimed the money not given the state in taxes was needed to convince Missourians to quit using illegal betting sites.  We’ll touch on that a little bit later.

—The casinos originally claimed the house advantage in sports wagering is “only” four percent (in 2023 the industry testified it was five percent).  But a study done for the UNLV Center for Gaming Research indicates that four percent is higher than most popular table games, sometimes double or more, and the industry has never asked for a favorable tax rate for table games.

In truth, the house advantage for sports wagering is more than four or even five percent, as the casino industry has claimed in some later legislative committee hearings. The website legalsportsreport.com charts statistics month-by-month in every state from the first month sports wagers were made in that state. As of last Sunday night, the webpage calculated $408-Billion dollars had been wagered in states allowing casino gambling on sports. The casino advantage worked out to 8.6%, more than double what the industry told legislators, and adding up to $35.1 Billion dollars.

Delaware, which has the highest tax on casino revenues, had the highest house advantage—25.1 to 46.5.  Delaware taxes casinos at a 50% and we’ve not heard any organized opposition to it.

Another excuse has been that Missouri needs a low tax rate to compete with surrounding states. Kansas is at 10. Iowa’s rate on casino earnings is 6.75, and according to an industry spokesperson. Missouri needs to have a low tax to keep Missourians from going to another state to place their sports bets.

The industry has presented no independent studies indicating casino customers care about the amount of taxes the casinos pay. In reality, the so-called competition rests on a simple question: Does Missouri have legal sports wagering? If Missouri legalizes it, Missourians presumably will place bets here because they don’t have go to some other state.

The industry also claimed it needs to have a much lower tax so it can pay for building sportsbook facilities within the casinos. If ninety percent or more of sports wagering will be done remotely, there’s not much reason for an elaborate sportsbook.  And, besides, building a sports betting facility in a casino should be considered a normal business expense with its own tax implications at the end of the business year.

This amendment has been called a “compromise between the stakeholders”—the six professional sports teams, the casino industry, and the remote betting industry” by St. Louis Cardinals president Bill DeWitt III.

But there are far more stakeholders than that. None of their representatives were invited to work on this “compromise.” Where were representatives of public education, host cities, veterans, the Access Missouri Scholarship Program, the National Guard program that provides veterans’ funeral escorts, people who develop gambling problems (we have seen several studies indicating those problems will triple with sports wagering), or even the Missouri Gaming Commission?

Here’s an answer: They were not invited because they were not considered participants in drafting gambling policy. Instead, they are industry targets whose only usefulness is based on how much money the industry can take from them or keep from programs benefitting them.

There’s one more stakeholder. The legislature, hired by the citizens to protect their interests. But the legislature has been MIA in protecting its constituents. The “compromise” is not a compromise at all.  It was, instead, an agreement to have the legislature give each of the stakeholders what they want. When the legislature fumbled several chances to satisfy the teams and the casinos, Amendment 2 was created.

It’s important as we reach the conclusion of these discussions to ask, “How did we reach this point?”

One reason this issue is on the ballot is that the legislature refused to resolve a competing issue—the legality of the gambling machines in many of our convenience stores, Video Lottery Terminals.

Supporters of video lottery terminals, while professing that they are legal, want the legislature to make them legal. The casinos see them as competing for their slot machine revenues and have not allowed an up-or-down vote on the VLT bills.  Supporters of the VLTs have filibustered the sports wagering legislation, demanding VLT legalization legislation be part of any sports wagering measure. The stalemate, especially in the Senate, has been a key factor in the pretty disgraceful deadlocks there that have resulted in historically-low levels of bill passage during the last three sessions.

The legislature lacked the courage in the face of extensive and aggressive lobbying by the casino industry to establish policies protecting the state’s interests and year after year considered the industry proposals without question. Only once that I recall did I hear a legislative committee member seriously press the chief industry lobbyist on some of these issues—Senator Denny Hoskins who was the leader in the unsuccessful efforts to legalize VLTs—was told he was out of time before he had finished his questioning. The replies he had received were vague at best.

A couple of years ago, I talked to the sponsor of a bill raising the tax rate to ten percent. A year earlier he had sponsored the industry’s bill that set the rate at eight percent. “What’s magical about ten percent?” I asked. “Last year it was only eight.”

He responded, “I figured that if ten was good enough for Jesus it was good enough for me.”

I was stunned for a second or two, and when I recovered my composure, I asked, “Jesus had twelve disciples not ten.  Can I get you up to 12?”

All I got in response was a smirk.

I found his responses to my questions arrogant, disrespectful, and dismissive. While I would not use the same phrases to characterize those who have advocated for this legislation, I think it is accurate to say there has been a certain confidence on their part that no outside opinions would be tolerated in the annual legalization efforts.

The legislature’s refusal to challenge industry-backed bills year after year is an indication of who has been in charge of things in the Capitol on this issue. Its inability to deliver what the industry—and in the last few years, the pro sports teams—wanted means the issue is likely to be put into the Missouri Constitution next week and the legislature will not be able to change things to protect the interests of the people of Missouri very easily.

I expect the mugging of Missouri and its people to succeed next Tuesday.  And we can thank a few generations of the people we think represent us at the Capitol for aiding and abetting it through their inaction.

 

 

Sports: Mizzou Miracle Doesn’t Impress Pollsters; Chiefs Roll to 6-0; Logano is Out, Then In, and Then REALLY In. 

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(Before we get started, we invite our readers to check on our series about Amendment 2, the sports wagering proposal on the November ballot, in which we address why the amendment is a bad idea for our teachers, our veterans, and even the host cities of our casinos.  We are not telling you how to vote, but we hope you’ll get a more honest understanding of what you will be voting on when  you read those three (so far) entries.)

(MIZ)—It might have been a legendary game but it was just a ho-hum event for the people who compile college football rankings.

Brady Cook’s dramatic return to the field after missing most of the first three quarters with an injury and engineering a 21-17 win against Auburn capped with a clock-beating 95-yard drive for the winning touchdown undoubtedly will show up on “greatest games” lists in the future.

But both major polls took Missouri down, perhaps noting that the Tigers again barely beat an opponent it was expected to beat.

The Tigers lost a spot in the coaches’ poll, falling to 17th.  The Associated Press took them down two spots, to 21st.

Auburn led 17-3 at the half, seven of those coming on a muffed punt reception that was recovered by Auburn in the Missouri end zone.  The Tiger Defense was stout all day while the offense was mediocre after Cook left early in the first quarter. His return put life back into the offense and that last methodical 95-yard drive was electric for the crowd.

The loss was a historic one for Auburn, which had been 150-1 in games in which they led by 14 in the second half.

ESPN’s Gamecast tells a crushing story for the other Tigers.  ESPN at one time said Auburn had a 94.3% chance to win the game.  And with 1:44 left, they were still at 88%.  But it all turned to ashes when Jamal Roberts scored a touchdown with 46 seconds left and no time outs remaining for Auburn.  Auburn drops to 2-5 with their third one-score loss of the year.

Missouri is 6-1 and is bowl eligible.  The significance of the bowl they’ll play in will be determined by the way they finish the seasons, beginning next week against Alabama.  The Crimson Tide dropped eight slots in the ratings after losing to Tennessee 24-17. The Tide will go into Saturday’s game ranked 15th.

(CHIEFS)—The Kansas City Chiefs are the NFL’s only undefeated team after beating the San Francisco 49ers 28-18 in the Golden Gate City Sunday. That’s a season high in points for the Chiefs. Patrick Mahomes had one of his lowest-rated games of his career with his second-lowest passing yardage totals.  But his personal-best 33-yard scramble kept a drive going that generated points. The backfield otherwise ground out time-consuming yardage and the defense didn’t let 49ers quarterback Brock Purdy have much breathing room.

The defense kept San Francisco out of the end zone until the third quarter, stopping for 49ers by forcing four punts, intercepting a pass, and surrendering only two field goals before a touchdown.

The Chiefs added JuJu Smith-Schuster to its list of walking (or limping) wounded. He went down with a hamstring injury he had been nursing all week in practice.

With Mahomes struggling in the passing department, the offensive line created opportunities for running backs. The Chiefs gained 186 yards on 37 rushes that led to four touchdowns.

The Chiefs take on the Raiders next weekend.

(SEC BASKETBALL)—The Southeastern Conference has held its pre-season basketball media days last week. Both the men’s team and the women’s team from Missouri haven’t gotten much love from media pollsters, with both teams forecast to be in the bottom half of the conference.

Missouri was winless in conference play last year. The Tigers lost five rotational players for 111 combined games last year, leaving men’s coach Dennis Gates “your hands are tied behind your back.”

Men’s coach Dennis Gates hopes his top ten portal class will and his high school recruit class that is rated number three nationally will produce a blend of “unbelievable talent.”

“I’m excited about our guys, meaning the first-year guys that’s in our program. I see how they’ve been able to adapt to our institution, to our community, and our entire community has accepted those guys with open arms, and these guys are comfortable…The portal guys that we did sign, we made sure that they’ve come from some great respectable coaches, and that’s where I wanted to kind of identify earlier to make sure that that took place also,” he told the media.

The spotlight recruit is Annor Boateng, a two-time Arkansas player of the year, “a 4.0 student, oung man who played in the band, plays the saxophone. His talents off the court is tremendous….As a basketball player, he’s a tremendous young man, multitalented, straight line driver, strong, physical…I look for him to make an impact.”

But there are several returnees Gates thinks deserve attention—Caleb Grill, who missed most of last year with a wrist injury, Trent Pierce, Ant Robinson, Aiden Shaw, and Tamar Bates. “They don’t shy away from confrontation [who] receive information like a sponge,” Gates said.

Missouri was an NCAA tournament team in his first year, a loser of every SEC game last year.
“Life happens in seasons,” aid Gates. “In real life you can’t start back at zero. That’s the unique part about basketball or college sports. We’re 0-0, just like everyone else.

Also hoping for a big turnaround in women’s coach Robin Pingeton who will be coaching her 15th year at Mizzou. Some observers are thinking her career at Missouri is on the line in the season ahead. Her team won two more games in the SEC last year than the men’s team.  But the Lady Tigers haven’t been to an NCAA tournament since 2018.

But Pingeton thinks bad times can lay the groundwork for better times. She told the media, “We all want the end result, which is a championship; we all want a deep run in the NCAA Tournament. That scoreboard is really, really important. But I also don’t want to shy away from the fact that sometimes when you go through hard times, those are where you really grow the most.”

The team has more height than it has last year with Tionna Herron, who is 6-4, joining Angelique Ngalakulondi, a 6-2 forward who was sidelined after eight games with an injury.

Pingeton is looking for an offensive boost with the addition of Nyah Wilson, who averaged 15.5 points a game for New Mexico last year along with 4.5 rebounds, two assists and 1.3 seals a game.

(BASEBALL)—The end of the World Series will end the baseball news blackout on coaching and managerial changes and player deals.

The Post-Dispatch has reported one of the first items to come from the St. Louis Cardinals will be the return of center fielder John Jay, who has been a coach with the Florida Marlins this year after a 12-year career that got him a Cardinals World Series ring in 2011. (the Marlins were managed this year by former Redbird Skip Schumaker, who has left the team because of “philosophical differences.”

Assistant coach Willie McGee is moving on to become a “special advisor.”

Speeding along—

(NASCAR)—-A week earlier, Joey Logano thought he had missed the NASCAR Championship semi-final round of races.  Sunday, he became the first driver guaranteed to run for the NASCAR Cup.

Logano stretched his fuel while leading the last 72 laps of the first race in the semi-final playoff round, and got the win that makes him one of the four drivers who will compete in the last race of the year for the Cup.

He ran just fast enough to beat pole-sitter Christopher Bell to the finish line by two-thirds of a second.

Logano is in the running only because Alex Bowman’s car was found to violate car weight rules a week earlier at Charlotte, forcing Bowman out of the playoffs and elevating Logano into the championship picture.

Some of the championship contenders had a rugged day in the desert.  Tyler Reddick rolled his car when he got together with Chase Elliott and Ryan Blaney on lap 90.  Reddick drove his bent car to the pits but it was too badly damaged to continue.

(FORMULA 1)—Formula 1 returned to the United States to run t the Circuit of the Americas, near Austin, Texas.  Charles Leclerc in a Ferrari led teammate Carlos Sainz across the finish line to give Ferrari its first 1-2 finish in the United States in eighteen years.  Lando Norris fought off series points leader Max Verstappen to finish third.

Formula 1 has one more race in this country—on the street circuit in downtown Las Vegas on November 23.

(photo credits: Cook, Missouri Athletics; Gates, Power Mizzou; Pingeton, Fulton Sun; Jay, MLB; Logano, Bob Priddy)

“Winning for Education” Turns Casino Host Cities Into Bigger Losers

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So this is what they get for three decades of being the hosts of Missouri’s casinos—a financial knife in the ribs.

For three decades, ten percent of the casino gambling taxes have gone to the home dock cities and half of the admission fees, too, to pay for the police and fire protection, the infrastructure the cities provide so people can go to and from their casinos, use their bathrooms, and drink city water instead of some of the river water under the ‘excursion boat” where they gamble.

The cities have used some of that money for other improvements—parks, for example.

But not with Amendment 2, the sports wagering proposal on the November ballot.

They’re cut out of it. Completely.

None of the sports gambling taxes will go to the home dock cities.

There will still be an admission fee charged for those who go into the casinos to place their sports bets. But Winning for Missouri, the committee that is, shall we say, gloriously overstating the public benefits of sports wagering, has an economic study saying that, eventually, more than 98% of the bets will be placed online.  There will be no admission fee paid by the casinos for almost all of the sports bets.  And there is no fee in lieu of the admission fee.  They’re going to keep it all.

None of the sports gaming revenue will go to the cities, as it does for present casino table games and slot machines. Admission fees going to host cities will be minimal.

Once again, everybody loses except the casinos and the sports teams—including the host cities (the formal name is Home Dock Cities, harkening back to the days when the industry convinced voters there would be real boats traveling on our big rivers, before they became boats in moats—which is a good thing; we might tell that story in a later entry).

The host cities have been getting the short end of the stick for all of these three decades. For more than a decade, fewer and fewer people have been going to the casinos. At their peak, casinos counted about 54-million admissions.  In the last fiscal year, the admissions continued their decline toward 27 million.

Adding insult to injury is the industry’s refusal to let the legislature increase the admission fees so those home communities admission payments could keep up with inflation. The equivalent of two-dollar admission fee established in 1993 was $4.31 when we checked the Bureau of Labor Statistics calculator Saturday night.

Yes, we mean “let the legislature increase the admission fees.”  Your faithful correspondent has suggested increases to legislators for six years. One of the more frequent responses is, “The casino industry would never buy that.”

The suspicion in the hallways for some time that the industry is, in one way or another, buying something.  It has several political action committees with bottomless checking accounts.  And legislators have to run for re-election for an unfortunately limited number of times.

The influence of the casinos is so ingrained in the legislative process that their representatives don’t even try to justify their statutory or constitutional demands. They just make brief statements about how great sports wagering will be and then sit down.

Not making any accusations, mind you.  We’re just sayin,’ as the colloquial phrase goes.

Anyway—the $4.31 equivalency means the state is getting two 1993 dollars while the casinos keep $2.31 of 2024 money.

The casinos are making more off the admission fee than the state and the home dock cities are making. But the situation is even worse than what we’ve just shown.

Inflation has reduced the purchasing power of those two dollars to about 95 cents.  So, while the home dock cities and the gaming commission are starving for funding with two dollars that are worth 95 cents in contemporary money, the casinos are making $2.31, and the gap between what the casinos keep and what the state and the home dock cities receive widens each year.

Our extensive research and hours with the calculator indicate the home dock cities and the State of Missouri, since the first casinos opened in 1994, have lost almost $1.9 billion ($1,880,392,926) in outright cash payments and in purchasing power combined because the casinos have pressured the legislature into making no change.

Extensive research has calculated how much each of our thirteen cities has lost in the last eight years or so. The individual tables are available but we don’t want to spend the space here to print them. Perhaps that can be done at another time.

Has anyone told our thirteen cities they’re being taken for a ride by their “excursion gambling boats?” The cities are part of the Home Dock Cities Association that one might think would be working to keep the losses from continuing and increasing.  But we have seen representatives for the association spouting the casino line every time they’ve testified before legislative committees.  It’s okay with the association, apparently, that the people they represent keep losing funding and will see no improvement from sports wagering.

The association says it favors the casino position because casinos are economic drivers for the region.  Really?   Can they show any studies that prove it? They haven’t, and the industry’s own statistics reported to the Missouri Gaming Commission show a different story.

We started compiling comprehensive statistics three years ago with a five-year lookback and we have updated figures from the Gaming Commission’s annual and monthly reports. In the now-eight years of statistics, these are the combined losses in cash admissions payments and lost value of those payments for each of our casinos:

  1. Ameristar St. Charles  $46,399,739
  2. River City, Lemay $43,956,210
  3. Hollywood, Maryland Heights $42,069,051
  4. Horseshoe (form Lumiere Place), St. Louis $31,287,455
  5. Ameristar Kansas City $36,290,466
  6. Harrah’s NKC $29,250,328
  7. Argosy Riverside $27,274,214
  8. Bally’s KC $21,852,498
  9. IOC Boonville $13,568,851
  10. Century Cape Girardeau $12,712,770
  11. Century Caruthersville $7,200,880
  12. Jo Frontier $8,357,439
  13. Mark Twain, LaGrange $5,718,114

Amendment 2 will only increase those numbers.

Sports wagering backers say sports wagering will generate hundreds of millions of dollars that will make a big difference for the pay of our classroom teacher.

That isn’t true.  As mentioned earlier, if voters approved Amendment 2, only a few million will be added to the $10-Billion dollar annual budgets of the elementary and secondary schools and the additional multi-million dollar budgets of our colleges and universities.

The industry has testified that increasing the admission fee to benefit our veterans would be a hardship on the industry, especially the smaller casinos. Bunk. It wasn’t but a few years ago when they paid $100 million a year, or more, for a decade and were not whining about the payments being an economic threat.

The industry has offered no statistical evidence to support its contentions.  It has shown no independent studies proving any of the claims made in their advertising leading up to the vote in a few days on Amendment 2.

The industry can’t or won’t supply that information to support its promises and claims.  But everything written in his series of posts is backed up by lengthy research.

Not only have the casinos fought efforts to maintain the value of the admission fee for their host cities, they have laid off about 5,500 of their employees since the number peaked at 11,658 in 2008.  In the most recent fiscal year, the total was down to 6,079.

Will sports wagering bring back those jobs? Not with 98% of wagers made remotely.  We can see a few more people serving drinks in the modest, at best, sportsbooks that will be created in our casinos to handle the few walk-ins. There might be a few runners taking bets to the I-T people—who might represent the biggest employee boost. But the jobs needle won’t move very much.

Let’s look at how much of an economic driver the casinos have caused in our five non-metropolitan areas, where one might suspect significant economic impact would produce community growth. Here are the population numbers for those communities, the census of 1990 first and the 2020 census next:

LaGrange  1,990-825

Caruthersville  7,389-5,562

Cape Girardeau  34,435-39,540

Boonville  7,095-7,969

St. Joseph  71,852-72,473

Five thousand jobs are gone. Limited population growth in some places or losses in others do not indicate casinos are causing their host cities to flourish. Admission Fees are dropping by the thousands, cutting funding for their host cities in half.

We mentioned in an earlier the industry’s claim that casinos “give back generously. Here’s the truth:

Casino “donations” or “contributions” to local causes are pennies on the dollar. Charitable giving during the last six fiscal years has averaged 0.000391% of their adjusted gross revenues. Their adjusted gross receipts have totaled almost $10.5 Billion in those years and their total charitable giving has been just $4.1 million. That’s less than pocket change.  And most of those who read these entries give far more than four-ten thousandth of our personal revenues to charities each year.

Again, we have charted the “giving generously” figures for each casino for the last six fiscal years. But we don’t have room for the charts in this post.  They are available, though.

A few years ago, casinos started reporting how much their customers left behind for charitable donations.  We have spotted six times when the customers provided more than the casinos did.

And that’s just fine with the industry, which fights every effort to restore funding to the towns that welcomed the casinos as great economic boosts for the area. Maybe for a while they were— thirty years ago.  But now?

The casinos also do not mention fees in Amendment 2, and for millions of reasons. The host cities have been getting the short end of the stick every year and it’s been getting worse for a long time. It is going to get even worse for host cities if sports wagering is approved next month.

I often wonder if the thirteen host cities ever get reports from their association or consider Missouri Gaming Commission annual reports that track how their fee income has fallen off a cliff and sports wagering will not save it.

Do not look for sports wagering to lead to reopened closed restaurants in our casinos. Not if only two percent of the sports bettors walk through the turnstiles. At one time, local restaurants feared the casinos would take away their business.  Today there’s far less competition from the casinos for the restaurant business in many of our towns.

One final thing before we go today:

The sports wagering proposal the casinos want to adopt in this election could be the prototype for expanded remote wagering in all other forms of gambling.  As walk-in traffic continues to dwindle, the casinos will be looking for more remote attachments to existing games.  Some casinos already have stuck their toes in those waters in recent years with hybrid table games—blackjack and other games in which people who can’t find room at the gaming table go to a computer nearby to place their bets.  The tests have not generated many dollars, relatively, but tests have been run.  Don’t be surprised if the casinos come back to our lawmakers and ask for remote slot machines and table games—again paying much less tax than those games pay now. It’s a characteristic of business that stacks the cards only for itself.

(We stayed at a casino hotel a few weeks ago and went to the breakfast bar where we placed an order and were given a tag for our table.  A few minutes later, a robot playing a catchy tune, came around the corner, and came down the aisle to my table, my order on its tray.  I took off the plate and the robot went back to the kitchen, trailing its little melody behind it. One nice thing, I suppose, is that I wasn’t given a choice of 15, 18, or 25 percent for a tip. I found myself wondering how soon there would be robots, not people, dealing the cards or spinning the wheel.)

There go more jobs.

Add the casino host cities  to the list of those whose situations will get worse if Amendment 2 is approved with its sweetheart tax rate, its deductions and carryovers, and its reliance on customers who carry casinos in their pockets.

This kind of thing should be handled by our elected representatives and senators, not written by two industries who place profit over any services to the people of the state.  But we have this proposal because our elected senators and representatives didn’t do their job.  Voters are well-advised to give them another chance by defeating a proposal that enriches the casinos and the pro sports teams and impoverishes our educators, our veterans, and the casinos’ own host cities.

Vote for Amendment 2 if you want.  But don’t do it if you think it will benefit anybody but the casinos and the sports teams, no matter what they tell you on the television or with misinformation you will find in your mailbox.

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“Winning For Education Makes Veterans Bigger Losers

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It’s about the time of year for the casino industry to put out its annual news release that the industry will “honor” veterans on Veterans Day, November 11, in “special ways.”  Veterans can get free or discounted meals (some specify the meals are from a limited menu) that day. They also can get a card for some free play, or spin a wheel for a chance at a free play card, or get complimentary tickets to a casino entertainment venue—stuff like that.

Of course, the casinos hope the veterans will drop a few dollars at the tables or the slot machines while they are there.

The truth is the casinos care about our veterans only in terms of how much they can take from their pockets and with sports wagering, their regard for veterans sinks to a new low.

“We give back generously,” says the industry’s Missouri web page.  Rubbish.

If you are a veteran, know a veteran, and/or are part of a veterans group, you need to read what we are going to tell you today about the sports betting proposal on the November ballot, Amendment 2, and circulate it. It makes our veterans even bigger losers than they have been. The casino industry behind this proposition could have written it to solve a major financial problem affecting our veterans. It did not do it.

Should veterans vote for it?  It’s up to them. But they should understand that the proposal does more TO veterans than it will do for veterans.

Basic fact: Missouri has seven veterans nursing homes that provide 1238 long-term skilled nursing beds. They are in Cameron, Mexico, St. James, Warrensburg, St. Louis, Cape Girardeau, and St. James.

Their major source of funding is from the casino $2 admission fee.  Funds raised from that fee go to the Missouri Gaming Commission, which uses some of that money to pay for regulation of the casino industry.  Nine million dollars a year are earmarked for the Access Missouri College Scholarship program and the National Guard Trust Fund that provides money for military rites at veterans’ funerals. A tiny amount goes to deal with problem gambling, if the Mental Health Department asks for it from the commissoion. After those deductions are taken, the remainder goes to the Veterans Commission Capital Improvements Trust Fund—which provides money for the seen nursing homes.

Admissions fees at our casinos that go to the veterans homes have been declining from $30.5 million in fiscal year 2012-2013 to just $11.2 million ten years later, a decline of 63%.

A report given to the Veterans Commission in July showed one-third of the nursing home beds were empty. It also showed the average daily cost of providing care had risen from $265 in 2018 to $469 in 2024, a 77% increase—and the purchasing power of each dollar was about 48 cents. .

Veterans Commission representative Aimee Packard told me last week, “Thankfully, the Governor and General Assembly have provided additional state funding to help ensure we are able to continue to care for Missouri’s Veteran heroes.”

Understand something else. These figures represent raw dollars.  Because the 1993 law that established the two-dollar admission fee had no escalator clause in it, the admission fee has never been increased to account for inflation.  The purchasing power of a 1993 dollar was only 47.5 cents in the most recent fiscal year, meaning the veterans homes are getting far less cash than they did a decade ago while the purchasing power of the buys a lot less at a time when the costs of care are substantially higher.

In other words, the Bureau of Labor Statistics calculated, as of Monday, the contemporary equivalent of two 1993 dollars is $4.42.  The casinos are paying the state two 1993 dollars with purchasing power of only 92 cents while they keep $2.42 in contemporary money. They are making more money on the admission fees than the state is making.

How’s that for supporting our veterans—which the industry has many times patted itself on the back for doing?

What does this mean for sports wagering and veterans?

Simply this:  Amendment 2 does nothing to stop this admission fee shortfall. Why?

Industry forecasts dating to 2019 were that 90% of all sports wagers would be done remotely within ten  years after the wagering is legalized, meaning there will be no admissions for 90% of all sports wagers.

Will the 10% of bettors who walk through the turnstiles to bet on sports be enough to offset the ongoing 2-3% in overall annual admissions?  If it does, the amount of money generated for veterans will be minimal.

And the casinos will pocket all of the revenue from remote sports betting without “contributing” (as they like to phrase it) a dime to the veterans nursing home fund.

Here’s the truth.  The casinos like to brag that they have “contributed” or “donated” (by now) $400 million to veterans nursing homes.

You know what donations and contributions are, don’t you?  That’s the money  you voluntarily drop into the red kettle at Christmas, the pledge you make to Alzheimer’s Walks and Cancer runs, the envelope you drop in the tray at worship services, the check you write to the United Way.

In 2012, when Governor Nixon asked the legislature to increase the admission fees by one dollar, the casino industry sent letters to Missouri newspapers saying (in excerpts): “As good corporate citizens, casinos do more than their fair share for military veterans…. No single industry in Missouri provides that kind of financial support to veterans programs…. We honor and support our military veterans and will continue to do so, and we ask legislators to find an equitable source of funding for veterans homes.”

No single industry provides that kind of support to veterans?  If the veterans homes had to rely on “that kind of support,” there would be a lot of boarded-up windows and “no trespassing” signs in a neglected yard.

“As good corporate citizens, casinos do more than their fair share for military veterans?”  Doing their “fair share” for veterans. Their fair share has withered in the last decade. The casinos have an interesting definition of “fair share,” don’t they.

With friends such as this, who needs enemies?

Let us be abundantly clear: The casino industry has provided money to the gaming commission and its worthy causes that include veterans only because state law FORCES the industry to make those payments. If this industry was such a great supporter of veterans and their nursing homes, wouldn’t you think it would have voluntarily maintained funding for those it might give a free or reduced-cost meal to on Veterans Day?

The casinos and their sports teams enablers could have written their proposed amendment to establish some kind of remote wagering fee that would stop the financial bleeding for the gaming commission and the veterans nursing homes.

But, no. They didn’t. The casino industry wants to pocket every dime it can, veterans be damned.

So much for giving back generously.

The Veterans Commission Nursing Home program is able to operate only because the legislature for several years has taken money away from other programs to keep the nursing homes open, even at a reduced level.

Before you vote to legalize sports wagering in Missouri, think what you are doing TO  our veterans, not for them.

Ask yourself: to whom do we owe a greater allegiance: casinos and millionaires playing sports—or our veterans.  And our schools.

If a ten percent tax on sports wagering proposed in the sweetheart deal that is called Amendment 2 will generate $100 million dollars for schools in the next five years, that means the casinos are going to have revenues of more than One BILLION dollars.

A few table scraps will fall to the floor for veterans.

Who needs money more—casinos or veterans and schools? Amendment 2 might produce a drop in education’s bucket.  But the veterans bucket will be increasingly dry.

Maybe it would be better for the people you elect to have the courage to represent their constituents on gambling issues.  But it’s going to take more political courage than I have seen for several years to do it.

Think about it. Feel free to circulate these postings to your teachers, teacher groups, and veterans and their groups.

Vote how you want. But understand who will be paying for you to have a chance to lose money betting on a sporting event. Our schools and our veterans, that’s who.

There’s a third group that will get the shaft if Amendment 2 passes: the casinos’ own host cities.  The casinos don’t give a damn about them, either.   That’s next.

One last thing today: We have a comment box at the bottom of each of these entries.  Several months ago, a person with the industry was heard in a crowded restaurant where were having dinner with friends say to them—in a voice loud enough to be heard by many of the other diners, “Don’t listen to him; he doesn’t know what he’s talking about.”

We invite the casino industry to use that box below to prove it.