Politics

Evan Horowitz

Voters can make the Everett casino disappear

Kim Sinatra, senior VP and general counsel for Wynn Resorts, and Robert DeSalvio, senior VP  for Wynn Development, were all smiles Wedneday morning.
Joanne Rathe/Globe Staff
Kim Sinatra, senior VP and general counsel for Wynn Resorts, and Robert DeSalvio, senior VP for Wynn Development, were all smiles Wedneday morning.

Steve Wynn has won approval from the state gambling commission to build a casino in Everett, but before he can break ground he’ll have to convince Massachusetts voters to support him.

One of this year’s ballot initiatives gives voters a chance to block casino gambling and nullify years of complex negotiations between cities, mayors, lobbyists, and developers. Or they could endorse casinos and give Wynn the green light he needs.

Can voters really stop this whole process?

Yes, according to the state’s Supreme Judicial Court. Back in May, Attorney General Martha Coakley tried to argue that the process had gone too far, and that it was too late for voters to intervene. But the justices disagreed.

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The result was ballot question 3, which asks voters whether they want to repeal the 2011 law that first authorized casino gambling. Because it asks about repeal, the terms are strangely flipped around but the impact is no less clear. If “Yes” wins, gambling loses. A vote for “no” means you’re happy with the law and eager to see the three resort-casinos.

What are some common arguments?

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- Casinos will help the economy. There’s evidence showing that casinos can provide a short-term economic boost. Over the long term, though, the benefits are less clear. And if you just compare the numbers, that really shouldn’t be surprising. Massachusetts casinos are expected to generate about $1 billion in annual revenues, but our state economy is 400 times bigger than that — too big to be affected by three new casinos.

- Casinos will increase state revenues. A tax rate of 25 percent is being applied to the casinos, which is quite high. Add in the money from slot parlors and we could be talking abuot $300 million to $400 million in much-needed revenue for state coffers. But there are at least two problems with this estimate. First, a rise in casino gambling often means a drop in lottery sales, which translates into less lottery money for the state. Second, $300 million to $400 million is only 1 percent of the state budget. The same amount of money could be generated by increasing the income tax one-10th of a percentage point.

- Casino gambling is a dying business. Massachusetts isn’t the only place hopping on the casino bandwagon. Lots of other states are doing it too, and as the market gets saturated revenues drop and casinos start to collapse. Atlantic City casinos are in trouble, as are casinos in Delaware, and Moody’s recently downgraded its assessment of the whole industry from “stable” to “negative.”

- Casinos have enormous social costs. It’s hard to put a number on it, but casinos do seem to introduce a range of social problems: increased divorce rates, bankruptcies, and of course gambling addiction (interestingly, the evidence on crime is not as clear). To mitigate some of these, the state has earmarked a portion of the gambling revenue for public health and aid to communities.

Are there important arguments people aren’t making?

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Gambling can be fun. That may sound banal but it’s surely one of the key reasons people want to legalize it. For many, going to a casino is a form of entertainment, like going to the movies or a show. You spend some money, you court the thrills, maybe you count some cards, then you go home.

Will the ballot initiative pass?

For now, polls suggest that the effort is likely to fail, and that gambling is probably here to stay. If that’s true, we’ll know a lot more about the real economic and social impact on Massachusetts in five to 10 years.

Then again, it’s entirely possible that voters will decide to end casino gambling. After all, this year’s polls haven’t proved all that accurate.

If it does pass, will that be the end of the story?

Not necessarily.

The casino developers could try to get compensation for the planning work they’ve already done — though when the SJC ruled to allow the ballot initiative, it didn’t seem sympathetic to this line of argument. A stronger claim for compensation might be made for the slot parlor in Plainville, since construction has already begun.

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Even assuming voters block casinos, gambling could still come to Massachusetts. Ballot initiatives— just like any other statute — only stand until they are replaced by a new law. The legislature could turn around and reauthorize casino gambling, though for now there’s no indication that they would.

Evan Horowitz digs through data to find information that illuminates the policy issues facing Massachusetts and the United States. He can be reached at evan.horowitz@globe.com. Follow him on Twitter @GlobeHorowitz