HEADLINES : Kentucky

Casinos no cure-all for state budgets, economists say

The Lexington Herald Leader | by John Cheves | January 17, 2012

FRANKFORT - Faced with another round of state budget cuts, Gov. Steve Beshear promotes casino gambling as a way "to improve our revenues long-term" in Kentucky.

But the nearly two dozen states that get revenue from casinos have struggled financially during the past three years, just like everyone else, according to a Lexington Herald-Leader analysis.

All of them cut spending; half raised taxes. Some fired thousands of their public workers, including educators and police, and gutted their basic classroom funding.

Experts who study gambling's economic impact said Kentucky should be realistic about what it could win. Casinos are a poor substitute for a strong, stable tax base, they said.

"Casinos will almost certainly increase your revenue to some extent. But there will be offsets and costs that you also need to consider," said Alan Mallach, a visiting scholar at the Federal Reserve Bank in Philadelphia.

 

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