NATIONAL GAMBLING IMPACT STUDY COMMISSION

BRENDA FLANAGAN

Martha Young.

Brenda Flanagan.

MR. FLANAGAN: I'm Brendan Flanagan.

CHAIRPERSON JAMES: Brendan. All right. I apologize, Mr. Flanagan.

MR. FLANAGAN: No problem.

Good afternoon, ladies and gentlemen of the Commission. My name is Brendan Flanagan, and I represent the Restaurant Association of Maryland, a trade association representing over 2,400 businesses throughout the State of Maryland.

I'm here to share with you just a few of the association's key findings which led us to oppose casino gambling after four years of extensive research.

We concluded casinos would be a bad bet for both our state and our regional economy after looking at four key economic areas: casinos' effects on existing businesses, their effect on tourism, their effect on jobs, and their effect on a state's budget.

In the interest of time, I will only highlight two or three key findings in these areas.

First, in the area of existing business impact, we found casinos to have a strong and negative effect on existing restaurants, hotels, shops, entertainment venues, and other retail outlets in which casinos exist.

But don't take it from me. Take it from Donald Trump, who was quoted in 1994 in a Miami Herald article as saying, "People will spend a tremendous amount of money in casinos, money that they would normally spend on buying a refrigerator or a new car. Local businesses will suffer because they'll lose customer dollars to the casinos."

What also alarmed us was a finding quoted in several casino studies, that the number of restaurants in Atlantic City from 1977 to 1987, while casinos were operating, plummeted from 243 to just 146 in that ten-year period. That's an approximate 40 percent decline.

Secondly, regarding tourism, our data suggests that the vast majority of casinos attract local populations rather than tourists, thus minimizing the possible economic benefits associated with tourist dollars.

A study by the Gaming and Economic Development Institute, for example, determined that a limited scale local casino draws 67 percent of its revenues from the local population.

A casino industry funded study in Virginia concluded that as many as 92 percent of a proposed casino's patrons would be state residents or people who were already visiting the area. Again, this is data from proponents of casinos.

Thirdly, regarding jobs, our findings concluded that typically there is no net positive job gain, and that by and large the work force was simply shifting from one employment sector to the other.

The State of Maryland's Department of Business and Economic Development was not quite as hopeful as some reports that said that the job wait would only be even. They concluded that there could be a net loss of up to 20,000 jobs if a casino came in.

And finally, regarding state budget impact, our research uncovered that the long-term costs associated with casinos oftentimes outweigh the gains. Indeed, we found that for any locality to conclude that casinos are a positive economic force without analyzing the cost is a little like a highway administrator claiming that the roads to be in good shape as long as you don't consider the potholes.

I appreciate this opportunity to speak before you this afternoon.