Local Economists Warn About Sands Promises On Casinos

Two economists and associate professors from the University of Dallas are calling out Las Vegas Sands for misleading the public about the potential benefits of casino gambling in Irving.

Speaking generally, Dr. John Soriano, PhD, said, “Across the board, casinos do lead to worse social outcomes.”

Soriano accepted that some economic benefits could arise, but at what cost?

Soriano explained that “rigorous research” into the subject shows an increase in almost every type of crime except murder and that there are other “large social consequences” such as addiction. Notable increases in crime include but are not limited to drunk driving, theft, and rape.

However, these facts are rarely addressed by the pro-casino forces at work in Irving. The Sands-supported Texas Destination Resort Alliance (TDSA) website does not address how socially deleterious behavior connected to casino gambling could be mitigated.

Likewise, Sand’s Vice President, Andrew Abboud, had previously told residents that his casino’s staff is trained to help a gambler in crisis and that allowing criminal activity on casino premises would be bad for business, therefore giving the casinos a purported incentive to self-police.

Abboud said during a contentious town hall meeting that the economic benefits of casino development would include billions of dollars in economic activity, 80-90k permanent jobs, and 185,000 construction jobs. The TDSA website says, “Revenue raised from these new sites could provide funding for public education and public higher education, for the arts as well as for public safety and law enforcement.”

TDSA also states on its website, “Each new project would create thousands of construction jobs, and tens of thousands of permanent new jobs in new and existing hotels, convention centers, restaurants, retail centers, and offices.”

Soriano noted that such inquiries operate on the assumption that “nothing else would happen on that plot of land if we didn’t have a casino,” creating a false binary choice between having a casino and leaving the land fallow.

The professor said any variety of development could be done on that land, from a stadium to a business district. Without presenting alternatives, Soriano explained that the public is being misled that only a casino could stimulate the area.

Dr. Malcom Kass, PhD, whose specialty is stadiums, weighed in on the possibility that the Sands may build a stadium on the property.

He said both stadiums and casinos are “a one-shot thing” that stimulate commerce to the extent that they increase stadium or casino jobs, but they do not have the wide and positive economic ripple that Toyota had when the company moved the North American headquarters from Southern California to the Plano/Frisco area in the early 2010s.

Kass explained that the tax and infrastructure benefits given to large stadiums to attract their development often end up balancing out the economic activity the enterprises stimulate in the long term. Other economists from Stanford University who have looked into the topic have made similar conclusions.

Soriano said constructing a casino or stadium could stimulate business at existing local hotels or restaurants. He pointed to research on the introduction of casinos to Detroit and said he found some increase in the value of commercial property around the casinos.

However, Kass appeared wary that a stadium would help existing commercial enterprises.

Kass pointed out that “a lot of times when stadiums are built, it’s usually the local hotels that bear the brunt of the [occupancy/visitor] tax increase in order to pay for the stadium.”

Drilling down on this point, Kass stressed that it remains to be seen if the proposed casino/hotel/stadium complex could be the “economic engine” Abboud said it would be.

Kass also pointed to the Arlington entertainment district, home to the Rangers’ Baseball Stadiums and the Dallas Cowboys Stadium, for comparison. He said that the arrangement of this district resembles a “European walled city, where all the economic activity happens within it” because of the vast expanses of parking lots and highway that make it difficult for spectators to leave the stadium and walk to a nearby, independently-owned bar, hotel or restaurant. He noted that commerce was mostly confined to small corporations operating in the district.

While the ‘walled city’ model would result in Sands capturing the commerce it creates, Soriano reasoned that this could “cut down drunk driving” as intoxicated gamblers would not need to leave the casino campus to go home or eat.

The Irving City Council is set to vote on March 20 to rezone certain tracts of land near the former Dallas Cowboys Stadium for casino gaming.

This rezoning action alone would not bring casino gaming to Texas. Casino gambling is prohibited by state gaming law, and these laws can only be altered by constitutional amendments, which would require two-thirds of the approval of the Texas House and Senate and the approval of a majority of voters on a statewide ballot.