Committee Votes to Expand Gambling in Alabama

AlabamaAlabama´s Senate Tourism and Marketing Committee yesterday voted to expand gambling in the Yellowhammer State to fill a void in the state´s budget.

Alabama has a bit of a budget problem. The state needs to find $200 million to balance its books and is at a bit of loss what to do about it. Suggestions such as raising taxes on cigarettes have failed to find favor in the free-smoking state, and politicians are reluctant to close corporate income tax loopholes that would hurt the people who fund their election campaigns.

Historically the Yellowhammer State has been opposed to gambling, but in recent years the subject has been identified as a source of taxes that Alabama could tap into. It has been well chronicled that millions of dollars are spent on out-of-state lotteries and at casinos in neighboring Mississippi, and some politicians believe that these millions should be used to reduce the State´s budget.

Del Marsh Proposals Passed at Committee Level

One of the politicians most in favor of tapping into potential gambling revenues is Senate President Pro Tem – Del Marsh (R-Anniston). Marsh introduced bills in 2014 and 2015 that would allow for a state lottery, allow for the introduction of slot machines and table games at the state´s four racetracks and authorize Governor Robert Bentley to negotiate a gaming compact with the state´s Poarch Band of Creek Indians.

The proposals – according to Marsh – would raise $400 million in revenues, and create 11,000 new jobs which would have an economic impact of $1.2 billion. Marsh supported his argument with the results of a survey that showed the majority of voters want the opportunity to vote on a potential expansion of [geolink href=””]gambling in Alabama[/geolink] and that they would prefer that option rather than having to pay higher taxes to fill the gap in the state´s budget.

Consequently, a hearing of the Senate Tourism and Marketing Committee was scheduled for Tuesday night to vote on whether the proposals should be considered as a measure in the 2016 ballot. The proposals passed with a majority of 6-2, and although this is a step in the right direction for the expansion of gambling in Alabama, the introduction of a state lottery and table games at racetracks is not yet a done deal.

Plenty of Opposition to the Proposals

Whether or not Del Marsh´s proposals to expand gambling in Alabama make it onto to the ballot paper is a difficult forecast to make. There are plenty of Republicans who hold strong anti-gambling principles and who have attacked the proposals as preying on the state´s poor.

Republican Governor Bentley has called the proposals one of the worst pieces of legislation I have ever seen, but his opinion may be influenced by the millions in campaign contributions he receives from Indian casinos in Mississippi keen to keep Alabama a casino-free state.

Even the Poarch Band of Creek Indians are opposed to the proposals as they stand – objecting to the introduction slot machines and table games at the state´s four racetracks. The tribe actually offered to pay the state $250 million to make the proposals go away!

Talking of “Preying on the State´s Poor”

The latest news about Alabama´s budget is not good. The Republican-controlled House of Representatives narrowly passed an amendment late last night that would reduce the budget deficit by cutting state funding to the Medicaid Agency by $156 million.

The saving would negatively impact the provision of healthcare to more than one million Alabamans (out of a state population of 4.8 million), but that is probably better in the eyes of the Republicans than closing corporate tax loopholes or removing tax credits from banks and insurance companies.

The highly unpopular amendment – that nobody spoke in favor of – is unlikely to clear the Democrat-controlled Senate or avoid being vetoed by Governor Bentley; and the probable outcome is that the state will have to dip into the education fund once again to balance its books.

The short-term is going to be a pretty messy period for politics in Alabama, but the silver lining on the cloud hovering over the State Government Offices is that the expansion of gambling in Alabama is practically inevitable.

Jacqueline Packett
Jacqueline Packett