Prosperity through gambling

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The big-money backers of a downtown Minneapolis casino and entertainment center are all over the place today, with a Facebook page, tweets and press releases and promises about the project they are touting as “Minnesota Live!”

Signature entertainment destination!
Thousands of new jobs!

Solves the state budget deficit!
Walks on water!

Okay, I made up the last two promises, but they’re in line with the glittering and pretty much unsubstantiated estimates of a consultant hired by the people who want to build the casino.

The consultant, Innovation Group, was hired by and reported to investors Bob Lux and Phillip Jaffe, principals of Alatus LLC. Their projections call for 5.6 million people to flock to the downtown casino complex every year, dropping hundreds of millions of dollars that would generate $125 million in tax revenue annually, and creating thousands of “high-quality gaming jobs.”

Right.

Payscale.com reports median wages at casinos and resorts ranging from $7.14/hour for a gaming dealer to $9.50 for a hotel housekeeping aide to a high of $12.77 for an armed security guard. The U.S. Bureau of Labor Statistics reports a median hourly wage of $12.51 for casino hotel employees, with a mean (average) annual salary of $29,160. Sound good? Not so much when, according to the Minnesota Housing Partnership, renting “a modest two-bedroom apartment [in the Twin Cities] requires a full- time worker to earn $17.77 per hour year-round.”

Of course, we could look to Las Vegas for insight on how gambling can undergird a strong economy. The Las Vegas Sun reported in March that: 

Southern Nevada is ill-suited for this recovery because of the continued dearth of commercial and residential construction and a relatively uneducated workforce.

Among 100 major American metropolitan regions, Las Vegas has experienced a worse recession than nearly all the rest: Southern Nevada had the 10th highest job loss, with nearly 10 percent of our jobs lost to the recession. We also had the 15th highest rate of economic contraction and the steepest drop in home prices.

The casino promoters say that downtown Minneapolis is perceived as unsafe and that they can save it, likening their plans for “the epicenter of entertainment” to New York’s Times Square.  A Pioneer Press article reported that developer Lux said that “some of the largest (gambling) management companies in the country” would be interested in the casino.

Indeed. Some of the largest gambling management companies in the country want to come to Minnesota — why doesn’t that make me feel better about the deal?

Perhaps a letter-to-the-editor writer in the Star Tribune, Richard Crose of Bloomington, had the right idea. He calls for changing Block E to Block V, for Vice, and bringing in truly profitable enterprises that could generate lots of tax revenue:

Bring back Moby Dick’s, but this time as an opium den with taxed and metered hookahs in every dark booth. The Lumber Exchange building would make a great brothel. Insert your Visa card in the door lock to get in and enjoy the beautiful women. … Change the homicide laws so not only can you shoot someone on your lawn, you can shoot someone who insults you on Block V. A wonderful time could be had by all, and think of all the jobs it would create!

A few other minor complications lie ahead for the deal. There are the constitutional problems inherent in any casino, noted last month by Politics in Minnesota:

A 2005 opinion from then-DFL Attorney General Mike Hatch argued that the 1988 constitutional amendment allowing a state lottery does not permit state involvement in a casino. Hatch also raised questions about the constitutionality of other expanded gaming proposals and said the issue would likely need to be brought before voters in order to further amend the state Constitution.

Another issue: the state of Minnesota’s existing compacts with 11 Indian tribes. Would a state-owned casino, whether in downtown Minneapolis (the developers’ proposal) or at the Mall of America (mentioned by Governor Mark Dayton during the campaign), violate the letter or the spirit of those compacts? 

But maybe I’m just a spoilsport to bring up all those pesky economic, legal and practical issues. The latest entry on Minnesota Live’s Facebook page surely has a more Minnesota Nice attitude:

“Seriously: How cool does this look?! I ache to be able to hang out on Minnesota Live‘s rooftop terrace.”