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As the District lurches toward financial ruin, it’s time to consider radical fixes. One way city leaders can beat the long odds is with a calculated roll of the dice. And a pull of the slots. And a spin of the wheel. In fact, keeping the city financially afloat may be as simple as relocating its tax collectors to riverboat casinos on the Potomac.
Gambling could be Washington’s financial salvation, although District officials would need to stand tough against Congress, churches, and others who would likely rise up in horror over the idea. The key is to move quickly and decisively, to exploit all available loopholes, and to adopt a (metaphorically speaking) go-for-broke strategy: All bets are on.
The evidence is clear that, when it comes to balancing the books, gambling is now the best game in the country. Consider Tunica County, Miss.: Since 1992, when the cotton fields made way for casinos, unemployment has dropped from 26 percent to less than 5 percent. A few years ago, Mississippi was a dirt-poor economic disaster; two dozen casinos later, the Federal Reserve Bank of Atlanta says the state’s prospects for economic growth are among the best in the South. And consider some other evidence about gambling’s incredible proliferation and impact:
Casino gambling is now in more than 20 states, and more legislatures are considering the matter. By decade’s end, it’s expected that every one of the nation’s top 100 cities will be within a three-hour drive of a casino.
According to the industry magazine Gaming & Wagering Business, about $394 billion was legally bet in this country in 1993. By comparison, annual automobile sales total only $350 billion.
The nation’s first legal riverboat was launched in Iowa in April 1991. By the end of this year, the number of floating craps games may reach three digits. In Illinois alone, attendance in 1993 topped 10 million on nine licensed boats.
Dozens of Native American tribes have launched casinos or high-stakes bingo operations, and dozens more are now negotiating compacts with state governments that would permit them to do likewise. The Mashantucket Pequot Indians, who operate the Foxwoods Casino in southeastern Connecticut, expect to generate $1 billion in revenues this year from their gaming operation.
Given this nationwide explosion of legalized betting, it would be the height of hypocrisy for Congress to oppose gambling in the District (of course, that’s never stopped lawmakers before). House Speaker Newt Gingrich believes that the creation of “radical enterprise zones” might help save D.C.—and you can’t get much more radical than to turn chunks of this crumbling mess over to Bally’s, Circus Circus, and other slot-palace operators.
If the city opts for riverboat gambling, the foot of Wisconsin Avenue in Georgetown would make a prime location. There, boats would be within easy reach of the city’s most upscale residents, wealthiest tourists, and most-spoiled college students, and a ramp from the refurbished Whitehurst Freeway could provide easy access for Virginians—especially those who normally avoid the city for fear of crime. There’s already a large parking lot on K Street, and the city could build multistory garages on its neighboring impound lot. If the wealthy tenants of Washington Harbour don’t like gambling halls in their back yard, let them move up to Foxhall Road.
The overflow from these Potomac casinos could be handled by riverboats docked at Maine Avenue, which would immediately transform the languishing seaport into a bona fide tourist trap à la Baltimore’s Inner Harbor. In addition, the city could authorize the licensing of minicasinos on the C&O Canal, from the Foundry to Fletcher’s Boat House—a strategy that would permit entrepreneurs with small barges to share in the enormous casino profits. This would require the donation of land by the National Park Service. But such largess would spruce up a canal that, when drained of water, is a garbage-filled eyesore that hurts the city’s already pathetic image. The only parties that stand to lose in this transfer of property would be the mules assigned the unenviable task of hauling tourist-filled boats to Glen Echo and back.
There are three ways that casino gambling could be legalized in the District: Either the D.C. Council or the U.S. Congress could pass a law authorizing its legalization, or residents could approve a ballot initiative. Getting Congress on board is important, since it can override the council’s actions. What’s more, approved ballot initiatives must be sent to the Hill for a 30-day congressional review, where they can also be scuttled.
But congressional vetoes need not sound gambling’s death knell here. Mayor Marion Barry and the council could follow the lead of California’s Indian tribes, which ignored a compact they’d negotiated with the state and installed slot machines anyway. California Gov. Pete Wilson protested vehemently, but the Barona Band of Mission Indians and some of the state’s other tribes didn’t seem to care: They not only left their existing slots in place, but added more. Wilson screamed louder, but to no avail. The slots still spit quarters.
In Arizona two years ago, armed federal agents raided a casino on the Fort McDowell Reservation, claiming that the Indians there were operating slot machines illegally—that is, without gambling agreements with the state. Angry residents formed a car-and-truck blockade to protect the machines, setting up a tense confrontation. The standoff ended peaceably, and eight months later the slots were reinstalled. District citizens tired of being played by Congress like spineless marionettes could certainly take on the federal government in like fashion.
Of course, the mayor and council could also circumvent this process by simply letting Native Americans run the city’s casinos. Federal law stipulates not only that Indians can build and operate casinos on tribal lands, but exempts the tribes from zoning regulations, which means lengthy and potentially protracted hearings can be avoided.
It’s true that no tribes call the District home, but that’s hardly an insurmountable problem. In Memphis, for example, local legislators were so envious of nearby Tunica’s gambling profits, they offered to give a sandbar adjacent to downtown back to the Indians for the purpose of running a casino. But since there are no Indians in Tennessee—a suspect 1818 treaty wiped out their claim to lands in the western part of the state, and subsequent federal policy pushed them away altogether—the Memphis council proposed recruiting a tribe. Another option considered by lawmakers was to permit an out-of-state tribe to operate a “satellite” casino on the designated island.
The Memphis council was set to let voters decide the matter with a referendum until the county election commission deemed such a vote unconstitutional. If the District follows suit, the Board of Elections and Ethics could take a hands-off policy and let the citizenry vote to lease land to Connecticut’s Pequots, who obviously know how to run a moneymaking gaming operation.
One prime location for an Indian casino would be RFK Stadium. With Jack Kent Cooke planning to move the unfortunately named Redskins, real Apaches or Chickasaws could move right in. If major-league baseball hands the area a franchise, owners certainly won’t want a team playing in a city teetering on financial ruin. Throw the D.C. Armory into the package (stereo-equipment shows can be held elsewhere, and the circus so demeans elephants it should be banned from the city anyway), and you’ve got a huge tract of land with parking, a Metro stop, and easy access from the eastern Maryland suburbs. Until the construction of new casinos is complete, temporary facilities could be erected in giant tents, much like the Hains Point tennis bubble. This has been done successfully elsewhere.
Congress might also want to give the city land near the Mall, where a casino would provide refuge for tourists who tire of the long line at the Washington Monument. And when the Republican-controlled Congress finally axes a federal agency, its headquarters could be used to house the Croupier Career Institute, where laid-off city workers could be retrained.
Another ideal location for an Indian-run casino would be the D.C. Convention Center, which everyone seems to believe is now too small for conventions. The building stands near the planned new home of the Bullets and Capitals, so sports fans will no doubt gravitate there. Restaurants and downtown retailers would receive a much-needed economic boost from the increased foot traffic, and the District would thus reap a sales-tax bonanza. The city’s share of revenues from this casino could fund a new, larger convention center, which in turn would create much-needed construction jobs. And the casino itself would generate more than enough employment opportunities to offset the downsizing of the city government. When the Pequots opened Foxwoods in February 1992, they had 2,300 workers on the payroll; 19 months later, employment had tripled to about 6,900.
If District leaders do use gambling as an economic foil, they can’t be timid. Rather, they need to legalize any and all forms of wagering and get out in front before the neighboring states catch on.
For example, the District should permit Bell Atlantic to offer D.C. residents wagering on its new interactive cable system. Just as the city runs the daily lottery games, it could act as dealer for in-home gambling. This service would offer round-the-clock wagering opportunities for those unable to travel to casinos.
Video poker machines should be installed in bars, a strategy that has proved an economic boon to South Dakota, Montana, and other states. Airlines will soon make gambling available on seatback terminals on international flights; the District government should authorize this same technology for taxi drivers, whose passengers would help generate critical funds for road repair and other infrastructure problems. The city’s hotels should be permitted—maybe even required—to emulate a certain Kentucky Holiday Inn, which recently equipped some rooms with voucher machines that permit lodgers to bet on races at nearby Churchill Downs. Races are beamed to the hotel’s TVs via satellite, making a trip to the track unnecessary. A modest service charge added to each bet—much like Ticketron’s procedure—would fill city coffers even further.
What’s more, the city should program slot machines—by far casinos’ most popular game—to pay off at very low rates. (The city needn’t, of course, make those rates known to the public.) In Atlantic City, for example, the dollar slots pay off between 90.3 percent at the Grand and 92.3 percent at the Trump Taj Mahal. That is, for every $1,000 that goes in, the machines collectively pay out $903 at the former and $923 at the latter. By contrast, the District could mandate only a 40 or 50 percent payout, pocket the revenues, and gradually raise the payout before slot hogs realize they’re being fleeced.
Even though these strategies would immediately turn the District into a financially stable economic powerhouse, civic-minded naysayers would undoubtedly object. They’d argue, for instance, that casino gambling attracts only poor people and leads to their ruin. Wrong. The Harrah’s Survey of U.S. Casino Gaming Entertainment reveals that casino gamblers are far better educated and much wealthier than the average American.
Opponents would also argue that casino gambling brings crime. That has certainly happened in places like Deadwood, S.D., population 1,800, where gambling was legalized a few years ago. But most of the increased crime has been due to the passing of bad checks and embezzlement, not to muggings or other acts of violence. In Washington, an increased crime rate would be imperceptible to most residents, since even murders here rate only a few sentences in the Washington Post Metro section. If the price of financial well-being is an influx of high-priced hookers or penny-ante card cheats, that’s certainly a price worth paying.
But if the District opts for gambling, it had better act quickly. With Maryland and Virginia ready to consider riverboats of their own, the opportunity for financial solvency may be lost. And if that happens, the city will really crap out.