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Gambling Revenue and a Tenuous Future for Education Funding

By Helen Gym on Feb 5, 2009 05:26 PM

As a Philadelphian who is active in a number of different communities, I never really thought that my volunteer efforts as a parent and education activist would have reason to intersect with my work at Asian Americans United fighting a casino in the heart of Philadelphia and next to Chinatown. But recent news about Pennsylvania's efforts to link gambling and education funding now has me wondering about how worlds can collide. Consider these recent connections around gambling and schools:

  • Gov. Rendell's rumored appointment to the School Reform Commission is Rosemarie Greco who serves on the board of the Pennsylvania Real Estate Investment Trust, landlord of the Gallery shopping mall, which is now in negotiations to lease to Foxwoods Casino; and

As the economic forecasts for the nation become more dire, and as states across the country continue to slash their education budgets (as many as 34 so far according to the Center on Budget Policy and Priorities), it's easy to claim gambling as easy revenue. Check out these comments by Nevada resident Ken McKenna:

"I think if the state of Nevada would lower the drinking age to 18, lower the gambling age to 18, we would have instant stimulus on our economy," McKenna says.

McKenna, by the way, serves on the state board of education, and he proposed this so that the state doesn't have to cut funding to schools. We're not too far off the mark here. Just listen to these state officials on the thought of video poker revenue:

  • "manna from heaven," says Berks County Rep. Tom Caltagirone, who sponsored a failed video poker bill last year forgetting about those kids wanting to go to college; and
  • an opportunity to "eliminate the gap between what families can afford to pay and what they are forced to pay," declares Education Secretary Gerald Zahorchak, in one of the more overreaching statements of the year.

It seems those two haven't visited any of the number of casinos going bankrupt in Atlantic City, or perhaps they missed the reflection by Louisiana State Sen. A.G. Crowe, who denounced gambling and video poker as "a big sell job" in a December Associated Press story. Or maybe they missed the Inquirer story which appeared in the paper right below the one touting the benefits of gambling revenue for improving education:

The state budget crisis may mean the end of a decades-old program that provided some of the state's most promising high school students intensive summer study in the arts and sciences, all free of charge. Officials with the Rendell administration say next year's proposed state budget, to be presented in Harrisburg today, does not include funding for the Pennsylvania Governor's Schools of Excellence.

The move to use gambling as revenue for core budget items like education and college funding is troubling to say the least. An interesting analysis from the New America Foundation shows that Pennsylvania still ranks among the 10 worst states when it comes to equity in school funding. And although Gov. Rendell himself has made efforts to narrow that gap, the consequences of the funding gap remain devastating. And as we also know (or should know), Pennsylvania is a bit of a dim bulb when it comes to pushing gambling - from a state gambling board that has twice granted licenses to felons (allegedly without the board's knowledge) to midnight legislation sponsored by a now-indicted state legislator. Recent editorials have described Pennsylvania's gambling fiasco as "the American casino industry's Waterloo" (Wall Street Journal op-ed), a "haphazard rush to ram gaming down the throats of Philadelphia's residents" (Philadelphia Inquirer); and a "debacle" (Philadelphia Daily News). There is no doubt that we face some of the most challenging times ahead of us, both as a Commonwealth and as a society. But after the encouraging efforts of the state legislature last year to institute a genuine funding formula, the news that the state may now be seeking gambling revenue to patchwork their way to fund our kids' futures is beyond disappointing. The combination of Pennsylvania's poor governance of gambling along with its historic reluctance to adequately fund schools can only magnify our problems - not alleviate them.

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Comments (9)

Submitted by Anonymous (not verified) on February 8, 2009 10:14 am

yesterday's Inquirer says there's $10 miillion a week (17,000 machines at $600) being gambled illegally. Why not try to at least capture that revenue for education?

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Submitted by Helen Gym on February 8, 2009 11:09 am

Well, there are a couple ways to consider your question. First, while touting revenue, there's hardly been any discussion of the cost of gambling - and it does cost. The Inquirer, for example wrote in October about how Pennsylvanians had reaped an average of $119 per person in annual wage tax savings as a result of slot machines, but average Pennsylvanians had put out more than double that amount - to the tune of $242 per person a year - into those slots. Studies show that small stakes gambling - lotteries, slots, video poker potentially - overwhelmingly target the poor and elderly . Other studies show that costs aren't just the $40 you lost at video poker at the bar, but also that that's $40 not spent elsewhere, and that's why economic costs of gambling are things like bankruptcy, foreclosure, increases in crime and violence, domestic violence, divorce and an increase in single heads of households. So the question is, what happens when the state sells an addictive and programmed loss machine (because each machine is carefully calibrated) targeting vulnerable populations in difficult times, then crows about free cash?

Second, there are lots of ways to get money and lots of illegal activities making folks a lot of cash, but generally as a society we've chosen to draw the line at legitimizing things long considered illegal. The gambling lobby, in conjunction with numerous politicans, has made it their business to make gambling just another form of entertainment and glamour, to pose it as free cash with no cost. But state after state that has tried this hasn't found gambling revenue to be anything more than an excuse to gamble - with huge benefits going to the casino and machine owners and tremendous costs exacted from the citizenry.

Submitted by Dylan (not verified) on August 23, 2014 9:35 am

In different gambling cities you can find casinos those providing the gambling games and people visits those places for entertainment as well as to earn some money. From a survey it is found that the highest percentage of revenue is coming from casinos that helps the government to invest it in some good channel like education.

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Submitted by tailor (not verified) on October 22, 2014 4:20 pm

I am no authority on gambling or law, but I would have no problem heading to the casino if that's what's going to give our young and bright children the hope of advancing in their academics. Well, I wouldn't say this is the only way to finance education, but if it's the only one that seems to work, why not give it a try? I believe that rather than fight gaming, we should at least try to understand how to take advantage of it for the good of everyone. And if you're afraid of making the first move on your own, there are many places where you can find information on how to start. My personal favorite portal is Ultimately, I would suggest that we first try to understand what the lottery is and evaluate what other states have achieved with it. Only then can we come up with ways on how to make it work better for our children in Philadelphia.

Submitted by Taxpayer (not verified) on October 22, 2014 5:25 pm

Is there any pot of money out there that the teachers' union does not want to get its grubby hands into? Aside from welfare payments, of course?

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