Yet another expansion of gambling is being planned in Ohio. The latest proposal for the state’s saturated gambling market is from the Ohio Lottery Commission, which hopes to get approval next week to provide about $19 million worth of “next generation” video lottery machines to fraternal lodges and veterans posts.
The lottery commission’s proposal, set to go before the State Controlling Board, asks for $22.5 million the next two years, including about $3 million to install and repair up to 1,200 machines.
The plan is an improvement over an initial proposal, which met resistance from fraternal and veterans groups and from Mike DeWine, the state attorney general. Still, it continues an unfortunate pattern of expanding gambling with little regard to what the market can bear and the harmful effects of gambling addiction.
Intralot, the Greek gaming company that runs the lottery’s back-office operations, wanted to provide the new machines, but under terms DeWine found problematic. The Ohio Constitution requires that lottery profits support public education. Under the Intralot plan, just 15 percent of the profits would have gone to schools. The remaining 85 percent would have flowed to the company and the posts and lodges, Intralot seeking three-fifths of that sum.
Under the new plan, Intralot hardly would suffer. It would be paid to provide the machines, then receive 1.83 percent of the gross for maintenance. Sixty percent of the profits would go to the lottery education fund, meeting DeWine’s approval, with 40 percent going to lodges and posts. Although the Ohio Veterans and Fraternal Charitable Coalition isn’t sold on the plan, 555 of the “next generation” machines have been requested from 188 coalition members.
In truth, the fraternal and veterans groups have little choice but to accept what the Kasich administration offers. It asked the Lottery Commission to come up with an alternative to the groups’ electronic raffle machines, which DeWine correctly viewed as illegal slots.
The state already has used the cover of the lottery to allow video lottery terminals at the seven horse racing tracks in Ohio. The tracks argued gambling was needed to keep them afloat. Veterans and fraternal organizations make the same pitch to keep their raffle machines, noting they have given $7 million to charity since 2012.
What long has been needed is an overview of all types of gambling. The lottery says its new plan would generate $10 million a year for schools, but gambling has been wildly oversold. Ohio’s casino operators said tax revenues from four sites would amount to $650 million a year. Now, projections are about $297 million.
Instead of approving more gambling, the governor and lawmakers should examine carefully the growing social risks and shrinking revenue estimates for what already is in place.