Why Business Playing is a Dangerous Guess for Alaska

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In his most recent speech on the state, Governor Mike Dunleavy re-suggested that "gambling" be expanded in the state in an attempt to boost declining revenue. However, he did not specify exactly how or to what extent. I disapprove of any commercial (for-profit) gaming add-ons that result and explain why.

First, let me provide my credentials. I worked for the state of Alaska for 33 years, including 25 years with the Treasury Department, the gaming unit of the tax department, first as an investigator (two years) and then as an auditor (23 years). During this time I learned a little about how and why there are games in Alaska.

In the days leading up to the oil, the state added legislative funding to the budgets of various nonprofits across the state, but soon found the process to be difficult, expensive, and inconsistent. To correct this, the state introduced the non-profit gambling program as it now exists. The program enables nonprofits to obtain authorization to conduct certain authorized gaming activities, including pull tabs, bingo, and sweepstakes. In addition, permits can enter into contracts with licensed operators to carry out activities on their behalf. This provides jobs and income to licensees who earn net revenue for the approval boards. The permits can then conduct their various charitable activities across the state at no cost to the state. In fact, they even pay the state for the game.

The governor's (suspected) commercial gambling will kill nonprofit nonprofit gambling unless it is so successful that it both adds significantly to state revenue and replaces lost net profit from charitable gambling as it exists now. Who would play bingo or pull tabs if they could go to a casino to play blackjack or roulette?

The state has already checked a lottery several times and determined each time that it would not work. The state's population is simply too small to support a lottery that would produce any useful profit. If we joined Powerball or Megamillions, we would only be increasing the prizes that are paid to outside winners – the chances of winning in Alaska are negligible.

If the governor plans to open casinos we have the prospect of high costs and even higher crime, especially if the state only regulates independent casinos that only pay a license fee and / or a percentage of the profit to the state. Again, we don't have the population base to adequately support a casino program. So we would have to rely on outside players and a crime would follow.

Are there really that many people who would come to Alaska to play?

When I got to Alaska I thought I'd spend three to five years and then decide where to go next. In my first year, I knew I was going to stay and that was 45 years ago. I've lived in Anchorage for all these 45 years. I really like Alaska – the way it is. The advent of commercial gambling is going to change the Alaska I know and love, and not necessarily for the better. Indeed, the expansion of gambling in the state will be a game of chance itself – one that will be way too expensive if it fails. If somehow it succeeds, in addition to government revenue, it will have to replace any lost revenue from the destruction of nonprofit games or pay directly for the functions the permits now perform with their gaming revenue. Either way you look at it, commercial gambling is expensive and I don't think we can afford the cost.

Joseph Koss is a retired non-profit accountant. He lives in Anchorage.