Loss limit repeal viewed as boon, boondoggle
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Loss limit repeal viewed as boon, boondoggle

Date: October 7, 2008
By: Joel Walsh
State Capitol Bureau
Links: The full text of Proposition A

JEFFERSON CITY - Gerry M. sleeps well at night.

It's been 11 years since he made his last bet, and the dreams of the phone ringing with creditors calling in the middle of the night have long since subsided.

Gerry said he will always consider himself a compulsive gambler.

"I can't look at you and say that I won't never gamble," he explained, "because if I did that I'd be lying ... I know I can't make that promise."

His story is one-half of an argument Missouri voters face on the November ballot.  Supporters of Proposition A cite the increased tax revenue for schools that would arise from repealing the limits on gamblers' losses. Gerry M., however, talks about the costs to gamblers.

Over an untouched cup of coffee, Gerry talked about the "hundreds of times" he made that very promise to his wife and family during the 25 years he spent in the throws of gambling addiction.

With arms crossed and eyelids clamped shut, he told how he lost his job because of the choices he made, how he stole money from his wife and children and how, during one empty drive home from the boats while living in St. Louis, he stopped on a bridge and considered taking his life. The thought of his family having to identify his body, he said, was the only thing that held him back.

Since 1998, the 65-year-old Jefferson City man has chaired a Gamblers Anonymous support group that meets in the Capitol city.

Gerry refused to divulge his last name because, he said, it would compromise the confidentiality of those who attend the weekly meetings.

He said it took him three and a half years working two jobs to pay off all the money he owed, which, he estimated, totaled around $196,000 during the course of his life.

Although Gerry said his first bet was in a private organization and he later wagered on horse races, the brunt of his losses, he claimed, came from slot machines at riverboats in Missouri and, before that, in Illinois.

For all the pain they have brought to him and his family, Gerry acknowledged several positive aspects that casinos bring to the state.

He said legalized gaming "has given us some jobs. And the jobs are good-paying jobs."

But he said he won't vote for Proposition A on the November ballot. If approved, it would repeal the "loss limit" that prohibits casino patrons from buying more than $500 in chips or tokens during a two-hour span in a Missouri riverboat.

"I'm going to vote against anything that makes it easier for somebody like me to become even more ill than what I was."

Gerry admits the state's loss limit has little effect on a determined gambler. He could search out someone's players card that was left in a machine, he explained.

In Kansas City or St. Louis, where casinos are in close proximity to one another, the two-hour barrier can be circumvented by hopping from one location to the next. Gamblers can bring chips from home or buy chips from someone who is willing to sell them.

"The loss limit, it never stopped a problem gambler," Gerry said. "What the loss limit does do is not let a starting gambler get into deep doo-doo."

Offering an opposing viewpoint, Scott Charton, spokesman for the pro-Proposition A campaign in Missouri, encouraged Missouri residents to cast a positive vote for the ballot issue in November.

He said Proposition A is a way to increase revenue for educational funding in the state without directly increasing the burden on Missouri taxpayers.

While Charton said he is glad someone like Gerry M. decided to seek help, he maintained that a loss limit is not a deterrent to problem gambling.
"Missouri casinos do not want pathological gamblers," he said. "They want people who can set a budget and stick to it."

Missouri is the only state in the U.S. with a loss limit in place. Charton said the unique regulation creates a competitive disadvantage economically and causes casinos - and thus state and local governments -to lose out on "vital" funding.

"A no vote on Proposition A will cause millions in revenue to flow to Kansas and other states and will directly reduce by millions of dollars the amount of revenue that is retained by Missouri schools."

Charton added that when riverboat gambling was first brought to Missouri in 1994 by popular vote, only two neighboring states - Illinois and Iowa - allowed for legalized gambling, with a total of seven competing casinos between the two states.

Now, Charton said, there are more than 100 gaming operations in bordering states, which include tribal casinos and racetracks with slot machines.

Out-of-state competition is chasing away 30 percent of potential profits, he said, referring to estimates by the Missouri Gaming Commission, the state's regulatory agency.

And with a Hard Rock Hotel & Casino slated for development in Kansas City, Kan., Charton said that Missouri casinos' desire to level the playing field has accelerated.

As reported by the Kansas City Star, a consultant hired by the state of Kansas estimated that the Hard Rock development could capture as much as $174 million from the Kansas City, Mo., market.
"That is a new border raid by Kansas against Missouri," Charton said.
Furthermore, he argued, Missouri casinos employ nearly 12,000 people.
"In this economy, protecting those jobs is vital, and Prop. A is a vital step in that."

While the future of loss limits in the state remains uncertain, what is known is the gaming industry in Missouri raked in approximately $1.6 billion in adjusted gross revenue in fiscal year 2008, according to a report by the Missouri Gaming Commission.

The official estimate for the ballot issue itself pegs the financial gain for the state as ranging between $110 million to $137 million with most of the money going to primary and secondary education.

Charton said that added revenue would be "a windfall for the schools," providing funds that could not be "supplanted or replaced."

Current, for the last budget year that ended in June 30, more than $26.1 million was provided to the state's early childhood development, education and care fund by casino admission fees, which are split evenly between the state and the localities where casinos are housed, the Missouri Gaming Commission reported.

An additional $15.5 million from those fees supported the Veterans Commission Capital Improvement Fund, the Missouri National Guard Fund, the Missouri College Guarantee Fund and a Compulsive Gamblers Fund over the same period.

In fiscal year 2007, casinos paid $366.8 million in real estate and sales taxes as well, according to reports from The Associated Press.
But opponents of Proposition A question who really stands to benefit if the measure is approved.
"If you think they're trying to pass this to improve schools, then I'll sell you some beach front property in Arizona," said state Rep. Raymond Salva, D-Jackson County. "It's just ridiculous."
He stated figures showing casinos' support for the Proposition A.
According to an Oct. 1 report by The Associated Press, Ameristar Casinos Inc. had put $1.2 million toward promoting Proposition A, with Pinnacle Entertainment Inc., a casino operator in the St. Louis area, adding another $1.2 million.

Salva said one component of Proposition A that would cap the number of casinos in the state to those currently built or being built creates a "government-sponsored monopoly."

Plans for casinos in both Salva and Knight's respective communities have been halted by a moratorium on licensing for new casinos issued by the Missouri Gaming Commission following the initiative petition's placement on the ballot.

Charton countered Salva's view on the cap, saying that only two U.S. states - Missouri and Nevada - do not limit the number of casinos.

"Missouri doesn't want to be like Nevada," he said, where residents can play the slot machines at "truck stops" and "Laundromats."

With 13 casino licenses currently issued in the state, Charton said, "I think that's plenty."

From an anti-gambling expansion perspective, Evelio Silvera, executive director of Chesterfield-based Casino Watch, agreed with Salva that Proposition A has been cloaked by the gaming industry in a shroud of purported educational funding.
"It's dangerous, it's deceptive and dishonest, and the only people that would benefit with Proposition A are the stockholders of Ameristar and Pinnacle casinos," he said.

Silvera questioned the need to remove loss limits when, according to reports from the Missouri Gaming Commission, the Missouri gaming industry has never had a down year.

Those reports show an increase in adjusted gross receipts for casinos statewide in every budget cycle since 1994, and, as Silvera said, "This has always been with a loss limit."

Silvera said an environment with safeguards like a loss limit "should be a model, not something you destroy just to be like everyone else."

He hypothesized that if Missourians were to lose more money on casino floors as a result of a repealed loss limit, the state would see potentially higher costs of dealing with bankruptcy cases, added government assistance programs for "deadbeat moms and dads" and a greater need for law enforcement expenditures.

Turning his blame to state and local  leadership, he said government has played an "improper role" as a beneficiary of gaming revenues.

"It should have never gotten to the place where the government got so wholly dependent on casino money that it caused citizens to be losers of their money," Silvera said.

Gerry M. conceded that the root of his personal gambling addiction cannot be attributed to casinos.

"Casinos didn't start my gambling, and even if they all went away, it wouldn't stop it," he said, " ... because there's so many places to gamble, not just in the United States, but in this state."

He blamed himself for his personal problems, but, he added, the state could have done more "to put money up front where you can get treatment for folks."
Gerry suggested an in-house treatment facility where, much like a halfway house for alcohol and drug addicts, problem gamblers could remove themselves from their home environment and receive state-funded counseling.
According to him, some Missouri officials refuse to admit there is a gambling problem in the state, "because if it exists, it's a problem, and we have to deal with it."
All the same, Gerry remembers the power his first Gamblers Anonymous meeting had.

"I sat down, and everybody at that table told a story of their gambling life," he said. "I thought, 'Son of a buck. Somebody else does this the same way that I do.'

"Before I always thought nobody else could be as lousy and ornery a father and a husband as I was. I was terrible."

Gerry now works one day a week as a security guard at a Jefferson City retailer, but for all intents and purposes, he said, he is retired.

While he claims to have never been back to St. Louis by himself, because the temptation is too great, he said he may go 10 or 12 days in a row presently without being gripped by the "cold, crunching urge" to return to the riverboats .

"But I got to be careful," he added, "because the further away I get, the less I remember how bad it was."

Gerry and his wife celebrated their 40th anniversary in late September.

He said she now balances the checkbook and makes the credit card payments each month. If there's a questionable purchase, Gerry explained, she'll ask him about it.

He doesn't participate in World Series pools; no Bingo or scratch-off tickets. If a neighborhood kid comes around selling raffle tickets for school, he might make a donation, but don't put his name in the drawing.

"People think I'm a real prude, because I don't do that," he said with a laugh. "They think, 'God, what is he, some kind of alien?'"

But Gerry's actions come from years of struggling with a compulsion he said, even during which, he wanted to kick, and night after night of restless sleep.

And now?

"I sleep like a rock," Gerry said.

When a recent storm passed through Jefferson City, knocking down "two pretty good-sized limbs" from the walnut tree in his backyard, "I never woke up," he said.

"It's the sleep of the innocent."

Candidate Positions on Proposition A

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