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Gambling's
Effects on Local Businesses
Much of the gambling
industry's rapid expansion in recent years can be attributed to
its effective courting of local business leaders, who have been
tantalized by promises of increased tourism and economic development.
In community after community, however, the promises of the industry
have failed to come to fruition. Worse, local businesses suffer
as discretionary dollars are drained from the economy and as they
and their communities experience the social fall-out that typically
accompanies legalized gambling.
- Iowa State
University researchers surveyed business owners in Clinton, Iowa,
to determine how they had been effected by the presence of a riverboat
casino. Twelve percent indicated business had increased, while
29 percent reported a decrease. Sixty percent said they had witnessed
no change. (Cathy H. C. Hsu, "The Impact of Gambling on Iowa
Tourism and Rural Businesses," Gambling and the Family Conference,
Iowa State University, October 31, 1996.)
- In a survey
of 900 Minnesota restaurant owners, 38 percent said they had lost
business due to gambling; only 10 percent reported an increase
in business due to the existence of casinos. (Arnold J. Hewes,
"Minnesota's Restaurants, Hotels & Resorts Are 'Losers'
In Gambling Explosion, Survey Results Reveal," News Release
from the Minnesota Restaurant, Hotel and Resort Associations,
January 13, 1993.)
- The number
of independent restaurants in Atlantic City dropped from 48 the
year casinos opened to 16 in 1997. (Evelyn Nieves, "Our Towns:
Taste of Hope at Restaurants Casinos Hurt," New York Times,
March 23, 1997, section 1, p.39.) Within just four years of the
casinos' arrival, one-third of the city's retail businesses had
closed. (Robert Goodman, The Luck Business: The Devastating Consequences
and Broken Promises of America's Gambling Explosion (New York:
Free Press, 1995), p.23.)
- The number
of retail businesses in Gilpin County, Colorado, dropped from
31 before gambling to 11 within a couple of years after casinos
arrived. Gilpin County is home to the majority of the state's
casinos. (Patricia A. Stokowski, Riches and Regrets: Betting on
Gambling in Two Colorado Mountain Towns (Niwot, Colo.: University
of Colorado Press, 1996), p.159.)
- More than
70 percent of businesses in Natchez, Mississippi, reported declining
sales within a few months of the opening of that city's first
riverboat. (Goodman, op. cit., p.31.)
- More than
half of business owners in Illinois riverboat casino towns reported
either a negative effect or no effect on their businesses from
the presence of casinos. Only 3 percent of respondents said their
businesses had been "helped a lot" by the casinos. (J.
Terrence Brunner, "Statement on Riverboat Gambling to the
Metro Ethics Coalition Project," Better Government Association,
October 1994.)
- A University
of South Dakota study showed that retail and service businesses
in South Dakota suffered a net loss of approximately $60 million
in anticipated sales in the year following the introduction of
gambling. (Michael K. Madden, "Gaming in South Dakota: A
Statistical Description and Analysis of Its Socioeconomic Impacts,"
University of South Dakota, November 1991, p.36.)
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