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The Honolulu Advertiser
Posted on: Sunday, February 10, 2002

Even Vegas faces streak of bad luck

By David Polhemus
Advertiser Editorial Writer

The Hawai'i Legislature seems to have held off the pro-gambling forces for another year, but there's little doubt its backers aren't going away. The stakes are far too high.

High stakes no doubt explain why so many of the nation's public officials — from Louisiana Gov. Edwin Edwards and Atlantic City mayors on down — have ended their careers in disgrace. Surely Hawai'i doesn't need more political corruption than it already has (for an eye-popping local survey, see Bob Dye's column on Page B3), and it's hard to image gambling without corruption.

"Gambling's easy access to cash and its proclivity for buying favor has meshed all too perfectly with a state full of purchasable lawyers, lobbyists and politicians," reads a book on gambling's sorry saga in New Orleans. Does anyone wish to see such a pronouncement issued about Hawai'i — or doubt that with gambling it's possible?

Gambling proponents brush off those fears and ask us to focus instead on the fabulous benefits it would bring our economy — jobs, tax revenues for schools, more tourists. The truth is, though, that in most places where it has been embraced in the United States, gambling has proved to be a major disappointment.

That may be so in places like New Orleans, Atlantic City and other lesser lights, you might say, but certainly not the mecca of American gambling, Las Vegas. But a couple of recent reports from Nevada suggest that gambling may be losing some of its luster as a golden goose even there.

Thirty-three Las Vegas-area casinos were seeking huge cuts in their property taxes, reported The Associated Press on Feb. 1, "asking officials to slash the taxable value of their properties by more than $2 billion."

MGM Grand was asking for the largest cut, from $1.04 billion to $171 million.

A $2 billion cut in the casinos' taxable value would mean an estimated $20 million drop in property tax revenue for Clark County and a $3 million loss — equivalent to 60 jobs, it's estimated — for Las Vegas.

Property taxes make up 35 percent of the county's budget and 18 percent of the city's budget, and are used to finance services such as police and fire departments.

Although no devaluation has yet been approved, it will be decided by an independent board not controlled by the city or county.

The county and the city already are experiencing a revenue loss since Sept. 11, said AP, with sales tax and room taxes on the decline.

Meanwhile, Nevada lawmakers were bracing last week for a budget shortfall of as much as $66 million, according to the Las Vegas Review-Journal. "The worst-case projections show a shortfall of nearly $17 million in sales tax revenues and more than $44 million in gaming revenues by June 30 if current trends continue."

These kinds of budget woes, which Hawai'i has experienced for more than a decade, are unusual in Nevada. But they show that there's really no such thing as a magic bullet, not even in Vegas.

Editorial page editor Jerry Burris' column will resume next week. Reach Burris through letters@honoluluadvertiser.com.