With Two-Casino Bill, N.H. Looks To Keep Up With Northeast Gaming Boom

Apr 29, 2015

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House lawmakers are set to vote Wednesday on a bill to legalize two casinos in the Granite State.

New Hampshire is just the latest New England state to look to casino gambling as a way to fill budget holes, raising the question of whether the Northeast gambling market is getting too crowded.

Father Richard McGowan is an associate professor of economics at Boston College who studies the gambling industry.

He joined Morning Edition to talk about the issue.

Rhode Island, Connecticut and Maine already have casinos. Massachusetts is set to open its first casino in June, with two more on the way.

With New Hampshire now possibly on the verge of getting in the game with two casinos, what’s your take on this race for casino revenue in New England?

Basically, it looks like the states are just trying to keep their own casino gamblers in state and not let them go to other states. The two Native American casinos in Connecticut – when they had a monopoly on casino gambling – over 40 percent of the people were from other New England states. Actually, one third was from Massachusetts and another third was from New York. Now it looks like every state is trying to hold onto its own casino revenue.

Governor Maggie Hassan says she’ll support the bill, despite her position that there isn’t a market in New Hampshire for two casinos. She’s pushed for one high-end casino.

Is she right to be concerned about market saturation?

Here’s where I kind of agree with her: you’re going to need something to differentiate your casino from others. Because, let’s face it, the one that’s going to be built in Boston is going to be a Steve Wynn affair. He’s going to spend $1.6 billion on this casino. She might have a good point in saying let’s build one decent where people from New Hampshire are going to want to stay in New Hampshire and not go to Boston.

Previous efforts to pass casino legislation have all failed in the Granite State. But now, with so many nearby states already well into the casino game, could that hesitation have cost New Hampshire?

To me, this is a defensive action by the New Hampshire legislature, saying we've got to keep the money in state.

Yes, in a certain sense. To me, this is a defensive action by the New Hampshire legislature, saying we’ve got to keep the money in state. They don’t want people going from New Hampshire to Massachusetts, which would be a first, since they’re usually coming up to New Hampshire to get their booze and cigarettes. It’s a way to keep the gambling money up there.

If passed, the two casinos are expected to bring in $120 million in initial licensing fees and supporters say they will bring in much-needed revenue to the state.

Has that casino revenue turned out to be reliable for states?

The classic example of that right now is New Jersey. Clearly, they had a monopoly for all those years and now every other state around New Jersey has casino gambling and notice what happened to the casino at Atlantic City – four out of the 13 closed. They had way too many and the people from Philadelphia stayed in Philadelphia.

The other interesting thing is New Jersey’s upped the ante by putting sports gambling in there. So, the New Hampshire legislature would be far from done with this because clearly if New Jersey does come up with sports gambling, it’s going to spread throughout the whole Northeast. It will be interesting to see how your legislature deals with that.

One of the arguments against casinos obviously issues around compulsive gambling and social costs. The bill going before the House would set aside some money for gambling addiction treatment. 

Have we seen those concerns about social costs come to fruition in the communities where casinos have been built in other states? 

It depends on the state. The states that have been doing it lately certainly have been a lot more concerned about it. For instance, in Massachusetts, 2 percent of the revenue has to be used for compulsive gambling treatment. There's usually an increase in drunk driving, more emergencies. There's all kinds of costs. Within a 50-mile radius, normally bankruptcies go up, so there's some real social costs involved in this.

What about the impact on charitable gaming?

Well, if it’s anything like Rhode Island; just think, Rhode Island has no bingo games left. There’s not a bingo game left in the state of Rhode Island. In general, it does hurt charitable gaming.