Alabama’s gambling misinformation problem is costing us about a billion dollars per year

Misinformation continues to undermine any chance Alabama has to regulate and properly tax gambling, and to implement a statewide lottery. 

It is, at this point, the single biggest hurdle to getting a comprehensive bill through our legislature. Because certain groups have figured out how to weaponize that misinformation in order to create chaos and confusion, and to maintain the status quo. 

The status quo, to be clear, is the most idiotic approach to gambling in America today. Alabama has one of the highest participation rates of gambling in the nation, with illegal casinos and sports wagering in almost every town, and yet we receive very little tax revenue from any of it. At the same time, all of that illegal gambling is funding all sorts of illegal enterprises, and the quasi-legal gaming in some areas is allowing certain groups to launder money gained through other illegal means. 

Combine the saturation and lack of revenue with a mishmash of state and local laws regarding gambling and the state is left with neither the resources, the willpower or the legal standing to stop any of it. 

Alabama is losing nearly a billion dollars annually by refusing to acknowledge the reality of gaming here and setting up a common tax and regulation structure—the same kinds present in states all over the country—to address this reality. Our people play the lottery. Our people wager on games. Our people visit casinos. And we all watch all of that money walk across state lines and pay for the college educations of kids in Tennessee, Florida, Georgia and Mississippi, and pay for those states’ roads and bridges and better internet and free two-year college tuition and zero taxes on gas and food. 

And it seems some folks are perfectly content to keep it that way. 

One of the leaders in this fight for the status quo is the Alabama Policy Institute. That organization has made no secret of their opposition to gambling legislation. It’s right on their website and they’ve spent a great deal of money opposing it. 

That’s fine in most cases. But API, for some reason that remains a mystery, has been granted unusual influence among Alabama’s Republican lawmakers. So much so that on Tuesday, when a new coalition of influential groups was announced—one that promised to join together to “go on the offensive against policies that will raise costs for families and employers in Alabama”—API was included in the list. 

So, like it or not, some lawmakers in the state are apparently listening to the folks at API. And when it comes to gambling, they’re getting a big dose of misinformation. 

That much was highlighted on Wednesday, when API posted a message to lawmakers on its Facebook page warning them that there is no such thing as a clean lottery bill in Alabama. 

Now, I am also no fan of lottery-only legislation, because I think it solves only a quarter of the gambling problems in this state. But that was not API’s issue. 

Instead, API claimed this: “If the Alabama State Legislature passes a Constitutional Amendment to change Section 65 of the State Constitution to allow Class III gambling, there would not be an opportunity to have only a lottery since a lottery is one of many types of Class III gambling according to federal law. Gambling proponents and politicians might misrepresent the vote as a vote for a lottery, but the people would, in effect, be voting to allow all types of Class III gambling to be legalized. The State of Alabama would then be obligated to allow card games, casino games, slot machines, digital/electronic games of chance, sports betting, and a lottery to be operated by any/all federally recognized Indian tribes that have a compact in the state.”

Very little of that is true. In fact, much of it doesn’t even make sense. 

For starters, there is only one federally recognized Native American tribe in Alabama—the Poarch Band of Creek Indians. There will never be others. 

For seconds, Alabama has had legalized Class III gaming in the state since the 1970s. It’s called pari-mutuel wagering, which happens at every legal dog and horse track. It was legalized by statewide constitutional amendments every time. And, surprise! It has not allowed the Poarch Creeks, who own two of those dog tracks in the state, to operate table games and other Class III games at their three legal casinos. 

And finally, the state of Alabama would not be “forced” to do anything, ever. That’s not how gaming compacts work, particularly when the discussion is centered around Class III gaming. Federal authorities give the states a lot of leeway in such discussions, because that class of games is considered much harder to regulate, and they place a significant burden on the state to do so. 

This is the sort of misinformation that leaves us stuck in the early 1990s when it comes to gaming regulation. It muddies the water for a topic that is already rather hard to understand, particularly for a state legislature that isn’t exactly known for its deft handling of complicated matters, and makes it very easy for lawmakers to just walk away from the whole confusing mess. 

I’m not saying that was API’s intent here. In fact, in comments below their post, someone from the organization argued repeatedly in defense of their original claims. 

But that, too, is troubling. Perhaps moreso. Because for those who deal with gambling-related laws and regulations, these particular issues are fairly basic and well known. That an organization that has the ear of so many conservative lawmakers is so obviously and publicly bungling them speaks to a much larger problem. 

An information problem. 

An information problem that’s costing Alabama citizens about a billion dollars per year.