May, 2004

Dear County Executive Dooley and Councilmembers,

It is with the sincerest respect that I ask you to consider with great sobriety the decision that I believe is yours to make regarding a new casino in our county. I realize that you have spent a great deal of time on this issue and I do not want you to get the impression I am not aware of all of the hearings and discussions you have had.

I regret that my own legislative schedule as well as my personal work schedule has prohibitted my being able to address your esteemed body personally. As you may or may not be aware, it is my considered opinion that the Gaming Commission will follow the lead of the council and no one else on this matter. I will say one thing to their credit, they do not like to force a casino in where there is strong local opposition. In this instance it seems there is confusion in the impression that the South County residents in unincorporated Lemay who seem to want something done with the National Lead site and the greater part of South Countians who are uneasy about a gambling outlet so close to home. As co-equal public officials I believe it is our job to work in concert for the benefit of our mutual constituencies. I humbly ask you to consider one thing.

Several weeks ago, I sent a letter to Kevin Mulally at the Gaming Commission that included several questions mostly pertaining to the macro economics of gambling. I have yet to receive an answer to this question. As the vice chairman of the Missouri Legislature's Joint Committee on Gaming and Wagering I can tell you no one has made a serious effort to answer one simple question. In my opinion, the central question is this: Will a casino in St. Louis County be a net economic benefit or a net economic deficit?

I can state unequivocally that no one to date has answered this question and it it wholly irresponsible for the Commission to continue siting new casinos without this answer. I have attempted for years to help them get this answer by calling for a Missouri-specific economic study of the economics of gambling. The Commission has neither supported my effort in any serious way nor taken it upon themselves to conduct a study that includes BOTH the economic and tax revenue "positives" of casino gambling as well as the economic and tax revenue "negatives."

Denny Coleman will tell you about the jobs created and the one-time investment. He will tell you about the tax revenue for several governmental entities including of course St. Louis County government and Lemay area school districts. What He simply cannot tell you because he has too little data is what happens to the broader South County economy when such a massive economic shift of disposable income takes hold in that community. He cannot tell you what the correlative decrease in sales tax revenue will be to St. Louis county as $10 million per month (presumably "disposable" income of mentally healthy adults) goes to the casino and away from other South County businesses. So while casino taxes increase this increase will be offset somewhat by decreases in sales taxes generated from other St. Louis County businesses. Can you say how much that will be?

Assume 30% of the new casino patrons are not locals. I have seen nothing to rebut that 70% of the casino revenues will come from South County residents. What will be the impact of an additional $7 million per month not being spent at area restaurants, shoe stores, movie theaters, church bingo halls, etc.? Has anyone provided you data to show what that impact will look like? I am told that when Atlantic City introduced casino gambling, fully 50% of their other businesses folded. Has anyone shown you how casinos can expand a state's economy? (Among states with budget deficit troubles I believe Nevada is number one per capita.) Has anyone provided data to show that new tourists will flock to St. Louis as a South County casino makes us a new national tourist destination city? If not, then you can assume that the people paying for the clean up of the National Lead site and funding those varied government coffers will be the residents of South County, specifically the losers at the slot machines. A certain percentage of the capital will be provided by businesses who find a sick employee has been embezzling from them. Who reimbursed the $700,000 embezzled by the County title office clerk?

I want to urge you to please demand the answers to these questions before voting on this serious issue. Are you absolutely convinced this is for the greatest good of St. Louis County for the long haul? You have it in your power to demand that the Gaming Commission conducts that critical economic study which duty they have so far neglected. The legacy of this vote will be perhaps the most important one you leave as elected public officials. Please be confident you are right.


John Loudon
State Senator (MO-7th District)
Subj: New Casino in St. Louis
Date: Friday, May 28, 2004 8:36:07 AM
From: Jloudon01