The more I study the electronic pulltabs issue for funding a Vikings stadium, I’m left with more questions than answers. Considering the seriousness of these questions, it’s puzzling why Gov. Dayton and Sen. Bakk support electronic pull tabs as a funding source for a Vikings stadium.
This article lays out some of the concerns about the electronic pull tabs option:
More than 1,200 nonprofit groups around the state offer paper pull-tab games in bars and restaurants as fundraisers for local school and civic causes. The groups have long argued they’re taxed too heavily. Of roughly $80 million in net profits in 2009, they paid about $37 million in taxes and had $43 million left to contribute to community programs.
A substantial portion of the proceeds from these fundraisers go to high school sports programs. Another substantial portion of the proceeds go to charities and community organizations.
That information alone should tell politicians that this is treacherous ground to tread on. Apparently, Gov. Dayton doesn’t think so. This article says that Gov. Dayton supports electronic pulltabs, aka e-tabs:
Dayton touts allowing electronic pull tabs as his favored form of stadium financing.
Gov. Dayton isn’t alone in supporting e-tabs as the primary source of financing the Vikings stadium:
Senate Minority Leader Tom Bakk, DFL-Cook, first pitched the idea of linking it to a Vikings stadium two weeks ago in Dayton’s office. Bakk said he won’t support a broader gambling expansion, but he supports the pull tab idea to help pay for a stadium and provide some relief for charities.
King Wilson, the executive director of Allied Charities of Minnesota, isn’t sold on the idea. Here’s a major reason why:
Wilson didn’t specify what share the charities need to make the plan work, but he said if it turns out the state takes roughly half the $72 million for a stadium and devotes the other half to tax relief, “I think we can have some meaningful discussions, and I think something is workable.” The problem, he said, is “there’s other people bandying about much smaller numbers.
“It’s simple: The higher the number the state needs for the stadium, the less money that’s available to do reform and relief, which is our priority,” Wilson said.
There’s more reason for concern than those mentioned by Wilson. This House Research report offers a stunning opinion. The title speaks for itself:
2006-2010: Industry under Stress
That’s just the tip of the iceberg. This information is troubling:
- Since fiscal year 2004, gross receipts from lawful gambling have declined by over 20 percent
- For fiscal year 2008, the industry reported its biggest drop in state gambling taxes paid—a 12.8 percent decrease from the previous year due to the drop in gross receipts
- Total receipts have gone from $1.500 billion in 2000 to $1.032 billion in 2009, a decrease of about 31 percent
Let’s remember that Sen. Bakk, then the chairman of the Senate Tax Committee, knew this information when he proposed this ‘solution’ to the Vikings stadium situation. This information raises important questions, more than I can address in a single post. The biggest questions go to politicians like Gov. Dayton and Sen. Bakk.
The first question I’d want answered is this: why would Gov. Dayton and Sen. Bakk propose using revenues from an “industry under stress” the last 5 years? The next question I’d have for Gov. Dayton and Sen. Bakk is equally simple: Why would they put funding for charities and school sports programs at risk?