Wisconsin faces constant pressure to increase state revenues in order to better fund schools, local governments and any number of state programs to enhance residents’ quality of life. In the past, state policymakers have turned to Indian gaming as a reliable source of nontax revenue. State government shares a percentage of tribal casino profits. Currently, there are efforts to expand Indian gaming to four additional Wisconsin cities: Beloit, Kenosha, Sheboygan and Shullsburg. These four communities will likely be advocating for more gambling in Wisconsin.
But is it in Wisconsin’s economic interest to approve additional Indian casinos? We asked Dan Alesch, Ph.D, a Wisconsin native and professor emeritus of public administration at the University of Wisconsin- Green Bay, to answer this question. Alesch’s findings cast serious doubt on the prospect that new casinos will increase state revenues.
In the past, it has rightly been understood that more gaming meant more money for all involved. But as Alesch points out, recent declines in the amount being wagered and won in Wisconsin casinos as well as increasing demand for internet gaming suggest that the Wisconsin gambling market is at or near saturation. While additional casinos may benefit individual tribes or communities, they are unlikely to increase state revenues on the whole.
The reason? Wisconsin’s gaming market is saturated. New casinos will simply poach customers and revenues from existing casinos. Casino advocates argue that putting casinos near the state border will draw customers from neighboring states. This may have been true at one time, but neighboring states are pursuing the same strategy to poach Wisconsin customers.
Alesch notes that new casinos are “not inevitable” in Wisconsin. Federal law empowers Gov. Scott Walker to make the final decision regarding new Indian casinos in Wisconsin. The clear conclusion of WPRI’s latest report — that new Indian gaming compacts are unlikely to economically benefit Wisconsin — should help the governor with that decision.