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Minnesota Legislature

Money for the Vikings — and more

Published (3/4/2010)
By Nick Busse
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Representing the Tavern League of Minnesota, Dan Campo demonstrates a video pull-tab machine during a hearing of the House Commerce and Labor Committee Feb 25. (Photo by Tom Olmscheid)It was gambling night for the House Commerce and Labor Committee Feb. 25, as committee members took testimony, but no action, on four separate proposals that would expand gaming in Minnesota.

Topping the agenda was the controversial Vikings-racino plan. Sponsored by Rep. Tom Hackbarth (R-Cedar), HF2578 would ask voters to approve a constitutional amendment to authorize casinos at horse tracks, thus establishing so-called “racinos.” Taxes on the resulting profits would help pay for a new stadium, with whatever’s left over going into the state’s General Fund.

Hackbarth said the proposal represents a reasonable compromise that would keep the Vikings in Minnesota as well as help close the state’s budget gap.

“We need income into the state of Minnesota to help balance this budget, and it also saves the Minnesota Vikings. … As you know, their contract runs out at the Metrodome after the 2011 season,” Hackbarth said.

Minnesota currently allows betting at two horse racing tracks — Canterbury Park in Shakopee and Running Aces Harness Park in Columbus. Hackbarth cited research indicating that allowing these two tracks to operate slot machines would generate up to $125 million annually in new tax revenue.

Cory Merrifield, founder of SavetheVikes.org, called the racino plan “a stadium and deficit solution that nearly pays for itself.”

“Some legislative leaders have said that Minnesota is not looking to expand gambling,” Merrifield said. “But the truth is, gambling is here, and it’s not going to go away.”

Not everyone agreed with his assessment.

Tom Prichard, president of the Minnesota Family Council, said social costs associated with gambling far outweigh the benefits of any new tax revenues. He said an expansion of gambling would lead to increased gambling addiction, crime, bankruptcies and divorce.

“We believe this is a bad way to raise taxes. It targets the poor and those who can least afford it,” Prichard said.

Several testifiers representing American Indian communities argued that it would compete with tribal gaming operations.

“Revenues generated at our tribal government gaming operation provide critical funding for education, health care and public safety services,” said Victoria Winfrey, president of the Prairie Island Indian Community.

Meanwhile, Dan O’Gara, representing the Minnesota Licensed Beverage Association, said bar and restaurant owners also oppose the racino plan because they fear it could lure customers away from their own pull-tab gambling.

A companion, SF2810, sponsored by Sen. Debbie Johnson (R-Ham Lake), awaits action by the Senate State and Local Government Operations and Oversight Committee.

Pull-tabs, slots and sports betting

Three other gambling bills got their first hearing from the committee — albeit with less debate.

Rep. Robin Brown (DFL-Moscow Township) sponsors HF2034, which would authorize electronic pull-tab games. Pull-tabs provide charitable gaming revenues to various community service and veterans organizations. Brown said allowing the electronic version of pull tabs would make running the games more cost-effective for those groups.

“It’s a form of gambling that’s already legal. It’s already regulated. People understand it here in Minnesota,” Brown said, adding that the electronic version of pull-tabs functions exactly the same way as the paper version.

Brown estimated that an additional $650 million per year in charitable gaming revenues would be generated by allowing electronic pull-tabs. That translates into an extra $17 million a year in state tax revenues, she said.

A companion, SF1644, sponsored by Sen. Dan Sparks (DFL-Austin), awaits action by the Senate State and Local Government Operations and Oversight Committee.

Two other gambling proposals, both offered by Rep. Phyllis Kahn (DFL-Mpls), would allow state-sanctioned gambling in new areas.

HF2354 would authorize the state lottery to install slot machines inside the terminals at the Minneapolis-St. Paul International Airport. The slot machines would only be accessible to travelers with a valid plane ticket. Kahn said the advantage is that new revenue could be generated for the state without competing with existing gambling facilities.

“Nobody is going to buy a ticket to go and gamble at a place that could probably be an inferior experience to gambling casinos,” she said.

Meanwhile, HF2984 would legalize sports betting in Minnesota. The state would essentially license bookies and tax all bookmaking transactions. Kahn argued it would merely be legalizing what everyone already knows is taking place.

“I’m not going to say that everyone here has engaged in sports gambling, but I can say with great confidence that everybody in here knows somebody who has been engaged in sports gambling,” she told the committee members.

One small problem: to allow sports betting, the state may have to challenge the constitutionality of federal law, which bans the practice.

Neither of Kahn’s bills have a Senate companion.

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