Electronic pull-tabs: Revenue Reality Check
Excerpt:
A major pillar of the Vikings stadium proposal unveiled last week is tax revenue from an expansion in charitable gambling. But such a financing plan has lots of unknowns — and one key question: Will the introduction of electronic gambling gizmos generate enough income to repay the bonds?
The financing proposal depends on electronic pull-tabs supplying funds to repay $398 million in bonds the state plans to float to build the facility. (Minneapolis will back another $150 million in bonds with sales taxes, pending City Council endorsement to the financial arrangement.
The entire public financing plan, Gov. Mark Dayton said last week, wouldn't use "a single dollar of general fund tax revenues.")
Minnesota already allows paper pull-tabs. To win cash prizes, players match pictures on the front of the cards they purchase, usually for $2 each, under tabs that they tear off. Bars and restaurants sell them on behalf of nonprofits, and the proceeds -- minus the prize money, expenses and taxes -- go to charity. Among those who benefit in Minnesota: American Legion posts, VFW groups and others who use the money to support local sports leagues, scholarships and the like.Comment: I'm not particularly naive but until pull tabs were recently explained to me, I didn't even know what they were. Sounds like a giant waste of time and money! The linked article examines the dubious propects of the electronic pull tab revenue source. A must read because if this stream fails, all Minnesotans will be holdlng the bag for the Vikings stadium
Star Trib today
ReplyDeleteAs Vikings stadium plan is unveiled, state quickly revises funding:
Standing with State Revenue Commissioner Myron Frans, the governor said that allowing electronic bingo and pull tabs in the state’s bars and restaurants would produce $62.5 million annually that the state could use for the $975 million stadium. Officials had earlier estimated that the gambling expansion would mean $72 million a year for the state, but said the revisions were made to satisfy charitable gaming officials who want tax relief for their industry as part of any Vikings stadium deal.
“We feel confident that this is a revenue stream that we can rely on” for the state’s $398 million contribution to the stadium, said Frans.
But he quickly conceded that should electronic bingo and pull tab revenues not generate enough money, the state would have to look at a backup funding stream that might need to be supported directly by state money – a move many Republican legislators who hold the majority in the House and Senate have already said they would reject.