Thursday, May 17, 2012

The Rise of Casino Gambling in Ohio

Ohio voters legalized casino gambling within the state by voting in favor of issue 3 on the Ohio Ballot on November 3, 2009. Issue 3 passed with 52.97% of voters in favor and 47.03% of voters opposed to adapting the state constitution. After the vote passed, the Ohio Constitution was amended to add Section 6C to Article 15. Section 6C (summarized) stated the following:
  • Authorize one casino to open in a designated area in each of the following cities: Cincinnati, Cleveland, Columbus, and Toledo
  • Levy a fixed tax of 33% of the gross revenue of each of the casino operators
  • Distribution of tax revenue (as follows):
o   51% among all 88 counties (Proportioned to population)
o   34% among all public school districts
o   5% among the 4 host cities
o   3% to the Ohio Casino Control Commission (OCCC)
o    3% to the Ohio state Racing Commission
o   2% to a state law enforcement training fund
o   2% to a state problem gambling and addiction fund
  • Impose a single $50,000,000 fee on each casino operator and require a minimum of a $250,000,000 initial investment in each facility.
  • Permit gambling types approved of in Michigan, West Virginia, Indiana, and Pennsylvania as of January 1, 2009.
  • Allow hours of operation of casinos to be determined by operator with no restrictions
  • Require that casinos adhere to all state health and building codes
  • Create the Ohio Casino Control Commission (OCCC) to regulate and license casino operators and staff.
          The 2 main supporters of issue 3 were Dan Gilbert, the owner of the Cleveland Cavaliers, and Penn National Gaming Inc., a casino operating company in based Pennsylvania. The video above shows that Gilbert and Penn National based their campaign on the creation of new jobs. The other main focus of the pro-issue 3 campaign was the enormous tax revenue that the casinos were expected to bring into the state. This campaign inspired some backlash from the opposition of issue 3. In particularly, David Zanotti of the Ohio Policy Roundtable, who raised the point that the state had more than ten percent unemployment at the time and the ads promising well over 30,000 jobs to the area. Zanotti was quoted saying that “it’s pretty obvious that the Ohio electorate bought into the whole culture of despair that’s going on with the economy.”
Anti-Gambling Campaign Button
The opposition to issue 3 was headed by the mayors of Parma and Youngstown, members of the Ohio House of Representatives Lou Blessing and Tyrone Yates, and Ohio Senate member Teresa Fedor. The anti-issue 3 campaign was based on the belief that the imposed tax was too cheap, both the potential positive and negative impacts of the casinos had yet to be fully understood and that by making casino gambling a constitutional amendment the path to altering the issue is solely through a ballot of the Ohio electorate. Following the vote, it was estimated by Penn National that all four of the casinos would be up and running in two years.
When approaching the issue of how to regulate their new casinos, Ohio looked at other states that had experience in doing so such as Nevada and New Jersey. These two states both deal extensively with gambling and handle it in two entirely different ways. The Nevada Model of regulation is to “give casino operators a relatively free hand on business decisions such as how many slot machines to offer or where to expand, so as to maximize the economic returns to the government and its citizens.” This relaxed regulation allows for extensive growth of casinos but also fails to prevent any of the negative social impacts that casino gambling carries with it. The New Jersey Model of regulation on the other hand, is based on strict regulation and the confines of gambling to a certain area (Atlantic City). The New Jersey Model was built on the fear of potential negative impacts while still taking advantage of the large tax revenue. Governor John Kasich's seven appointed commissioners of the Ohio Casino Control Commission had hopes of crafting a new model that lay in between the strict confines of the New Jersey Model and the loosely regulated approach of the Nevada Model.
The Horseshoe Casino Cleveland
Today, roughly 2 ½ years later, the Horseshoe Casino Cleveland has already opened, as recently as Monday, May 14th, and the Horseshoe Casino Cincinnati to open in the spring of 2013. However, John Mangles reporter for the Cleveland Plain Dealer has researched and concluded that “only preliminary work has been done on writing the voluminous rules that will govern everything from the background checks that casino employees must undergo and how slot machines will be inspected to the types of ads that casinos can run.” The deadline is here, and not only is there still a tremendous amount of work to be done, but some of the policies already in place need to be given some scrutiny.
There are many concerns as to the social impacts that the casinos will bring to their host cities. Some of the major ones that have been addressed by casino operators and the state government are the potential increase of crime, the training of potential employees, and the regulation of health and building codes. So far the OCCC has been very strict in their inspection of the facilities which has caused some delays in the opening dates for the casinos. Also the state government has been working to prep the employment market for casinos by sponsoring training programs for table workers and mechanics for slot machines and video gambling machines. The potential for a rise in crime in the areas surrounding the casinos has been dealt with by the increase in funding to police forces in the area that was included in the addition to the Ohio Constitution. The operators of the new casinos have been doing their part to prevent the infiltration of organized crime by running extensive background checks on all potential employees. However, there remains the worry that the casinos will fail to generate the predicted $643 million of tax revenue for the state. This concern is relatively wide-spread since Ohio has never been a market for casino gambling and has no history to back up the claim. Another worry is that the casinos will attract other less desirable businesses to the surrounding areas. The state and the casinos themselves have been working hard to buffer the negative impacts of issue 3, but there is still a relatively large amount of concern as to whether they will be successful.
Problem gambling
      There is one concern generated by gambling that seems to be nearly entirely unaddressed not only within Ohio’s new casino gambling policies but in the policies that regulate gambling of any type in any state in the US. The problem is known as a gambling addiction or a gambling problem. An individual experiencing difficulties with gambling is commonly called a problem, pathological, or compulsive gambler and “is characterized by a loss of control over gambling, deception regarding the extent of one’s involvement with gambling, family and job disruption, theft, and “chasing” losses or attempting to win back money that has been lost while gambling” (Ashley & Karmen 28). The cause of gambling addictions is not fully understood as of today, however there are many plausible theories. Amnon Jacob Suissa, professor at the School of Social Works at University of Quebec in Montreal says that "the phenomenon of addiction maintains that so-called pathological gamblers because of a certain cognitive and perceptual deficiency. Seen as the cause, and not the consequence, of the addictive activity, these defective structures are said to interact with attention disorders and impulsivity" (Suissa 15). The worries of Ohio residents are growing more apparent as opening dates for the new casinos are closing in. This is evident to almost everyone who takes the time to look as the records for last March that “show that calls to the state’s problem-gambling help line expressing concerns about betting on casino slots or table games were triple the average for the past eight months”. There has been known to be a slight increase in the number of calls to state gambling helplines in the early spring which could be the cause of this. More likely, the increase is due to the close proximity of the Horseshoe Casino Cleveland. As indicated by the chart below, the distance between a casino and the surrounding cities has a strong correlation with the number of calls to state gambling helplines, and thus to the number of problem gamblers living in surrounding cities. According to the National Gambling Impact Study Commission "casinos double gambling addiction within a fifty mile radius." The evidence is quite blatant that these four new casinos will cause a rise in the amount of problem gamblers in the surrounding areas.
Distance to casinos compared to calls to the state problem gambling helpline in Connecticut
      Thus far the OCCC has looked to other states in an attempt to find ways to regulate casinos, and to diminish the negative impacts of casino gambling. This approach has definitely benefited the policy making process. However, the OCCC needs to broaden their field of vision and adopt policies that have proven to at the very least diminish the negative impacts of casino gambling. Problem-gambling researcher Rachel Voldberg said that what she has seen “that’s different outside the U.S. is that gambling operators and regulators have been told that while revenues are important and helpful, protecting the vulnerable is an equally important goal.” In the U.S., self-exclusion and addiction treatment programs are currently used to battle gambling problems. However, "self-exclusion and addiction treatment programs are useful, but they address, respectively, only 1 to 10 percent of the problem." This ideal of protecting the players has been used efficiently in other in numerous forms such as the player recognition systems used in Holland that record the identity of casino patrons in order to monitor how often they gamble and assess the possibility of a gambling addiction. Also in Singapore there is a $100 fee charged at the door to everyone wishing to enter, and the slot machines in Canadian casinos shut off after two and a half hours of play to force players to take breaks from gambling. These policies have become known as the tools of harm minimization which is “a controversial public health approach, akin to distributing clean needles to heroin users, that strives to lessen gambling’s potentially damaging effects while not necessarily curbing the overall activity.” It's quite apparent that harm minimization will not completely abolish problem gambling, but it is currently the most effective tool to combat its growth. There are policies in place throughout the world that may help to solve many of the problems Ohio is soon to face, yet as of today; none of them are expected to be put into action here.
Problem Gambling Help is offered by the government, but it is entirely up to the player to seek it out.
      Ohio is entering an era that was previously unknown to it. The legalization of casino gambling in Ohio has surged a lot of concern by policy makers, but as the ones that voted in favor it, Ohio citizens must concern themselves and make sure that they can use their right to influence policy by writing letters expressing concern to their state senators and representatives as well as by informing others that there is a problem that needs to be dealt with. Also, pay attention to the gambling habits of those close to you so that if a problem does develop it can be dealt with early on. The OCCC needs to begin to recognize problem gambling as a concern that can be dealt with and begin to take preventative measures to ensure that it doesn’t become the silent epidemic that it has been previously been coined. Casino gambling could be great for Ohio and could be a significant factor in restoring the states economy, but it could also be terrible for Ohio if we don't take the necessary steps to deal with its repercussions.

Works Cited

Ashley, Larry L., and Karmen K. Boehlke. "Pathological Gambling: A General Overview." Journal of psychoactive drugs 44.1 (2012): 27-37. Print.
 Suissa, Amnon Jacob. "Vulnerability and Gambling Addiction: Psychosocial Benchmarks and Avenues for Intervention." International Journal of Mental Health & Addiction 9.1 (2011): 12-23. Print.


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