Whew, the mid-term elections are in the rear view mirror. It brings an end to incessant political advertisements and speeches, to a daily stream of emails soliciting support and the harassing robocalls. The campaigning was intense, the rhetoric inflamed and the emotions strong – but it worked. A record number of people voted in a mid-term election in many states; at least two states had more early voters in 2018 than total voters in 2014. The mid-term election was also a media field day with polls and predictions becoming a permanent part of the daily news cycle for months. Some polls predicted a blue tidal wave would sweep the nation, while others predicted the Republican Party would win handsomely in a ringing endorsement of the president and his policies.
From where I sit, the results are not clearly one of those things or the other. Depending on which side of the blue/red line you stand, the Democrats proved their case or the Republicans held off the challenge with the help of the president. In my opinion, the real winners on November 6th were women, minorities and younger candidates. It might be a long-term trend with far reaching implications.
Besides the candidates competing for public office, there were other issues on the ballot. In eight states some gaming-related issue was on the ballot and in at least three states, gubernatorial contests had gaming implications. There were no overall national trends in the result; in some states pro-gaming measures passed, while in others, they failed. It all depended on local conditions and the forces behind each side in the debate.
In Florida existing casinos and Disneyland fought to limit gaming. Voters granted their wish and approved a measure to make any expansion of gaming subject to a vote of the people and approved a measure eliminating dog racing. The measure essentially ends any gaming expansion in Florida in the foreseeable future. In Idaho voters failed to approve a measure that would have authorized historic racing machines (slot-like devices); that measure was a battleground between Indian tribes and racetrack owners. The tribes probably had more money and a broader base of public support, although the governor supported the racetracks.
Louisiana voters approved fantasy sports betting. Fantasy sports is just a stop gap measure, casinos in the Bayou State are going to experience a very strong competitive pressure from sport betting in Mississippi. As a result, lawmakers can be expected to begin debating the subject within a year. Voters in Missouri approved expanding bingo. Bingo is authorized for non-profits, but with enough incentive some entrepreneur will figure out a way to make a good living from bingo. However, it will not lead to millions of dollars of investment or turn into a national trend. In Maryland a measure to use gaming taxes for schools passed. Arkansas voters approved the development of four casinos and sports betting.
In a minor local referendum in Forest Park, Illinois that gets approximately $170,000 a year from VLT taxes, video gaming was banned. It is thought to be the first community to vote out VLTs and some observers are speculating it could be the beginning of a trend. There are already 30,000 VLTs in Illinois and many communities may be second guessing the value of hosting them. That would be a dramatic change from the expansion of the last few years.
Illinois is one of the states where gaming was part of the subtext of the gubernatorial election. A pro-gaming candidate, J. B. Pritzker, was elected governor in the Land of Lincoln; the outgoing governor, Bruce Rauner, was not exactly a friend of the industry. In Wisconsin, Tony Evers unseated the incumbent Scott Walker, an outspoken opponent of Indian gaming, opening the door to possible expansion of some tribal operations in Wisconsin. In Idaho, a Native American woman, Paulette Jordan lost to Brad Little; had she been elected Indian gaming would certainly have had a friend in Jordan. Nevada’s gubernatorial race also had an implication for the state’s casinos. The new governor will appoint three new gaming control board members. In essence, the winner of the contest, Steve Sisolak will have the power to reshape the control board. It is a particularly important time for gaming regulation in Nevada with sexual harassment, the spread of sports betting outside of Nevada and a potential major merger on the horizon over the next couple of years.
Even though each of the outcomes was locally specific, like the national election, there is at least one underlying trend. The voting in Arkansas, Florida and Idaho was influenced, one might say controlled, by local Indian tribes. The major funding in each case was provided by an Indian tribe in partnership with other local businesses. At the same time, two Native Americans were elected to Congress for the first time. Indian tribes clearly demonstrated in this election they have the money and political skills necessary to become significant factors in the future. When California debates sports betting, the Indian tribes will be a major voice in the discussion. In Oklahoma and surrounding states, Indian tribes are actively involved in pushing for expanded gaming, just as they did in Arkansas in this election.
After all of the votes were counted and all of the commentaries written, the only significant outcome of this election for gaming was in Arkansas. There are four licenses available and insiders will get the get them all. Hot Springs and West Memphis are going to local race track operators. The other two could easily go to the Cherokee and Quapaw tribes of Oklahoma; together with the track owners, the tribes funded the election campaign. It was an interesting election, although a bit overwhelming at times. As a result of the voting, gaming will expand in Arkansas, Louisiana and Missouri, but not in Idaho or Florida. For the next two years any expansion will come from the legislature, not the ballot. And we will all get a much needed rest from the campaigning.
