A continuing series by past Lakewood city councilmember John Arbeeny.
Perhaps the first and greatest gambling myth is “The City of Lakewood needs this revenue or it will have to cut 25 police officers or raise taxes”. This scare tactic is a classic example of the “Big Lie” perpetrated by both City Council and the gambling industry. A big enough lie told often enough tends to be believed and repeated by many without thinking. It is possible to have a balanced budget despite falling revenues and without cutting public safety. Pierce County made that commitment to cover a $7M budget shortfall (TNT, “Public safety could be spared in Pierce County budget”, 5/23/08) and Lakewood can do it too.
How much annual gambling tax are we talking about? $2.5M at last count: about $48 per capita. What they don’t tell you is that for every $1 in gambling tax revenue there are about $6.00 in social and economic costs: that’s a net loss of $240 per capita or about $15M City-wide. Most of these costs are borne by someone other than government: churches, families, social service organizations, etc. The $2.5M in gambling tax also means that another $20M was taken out of Lakewood’s economy by casinos. So although the City government “wins” $2.5M, the casinos get $20M, and Lakewood citizens pick up the tab for another $15M in social and economic costs. At those odds we’d be better off buying Lotto tickets to balance the City budget!
In this myth, the City’s own lack of fiscal responsibility is as much to blame as anything the gambling industry might do to Lakewood. When you have a lot of “easy money” floating around you don’t have to be very responsible financially. I have participated in developing three City budgets which have grown in size annually but never adequately prioritized any of the 18+ functional areas (police, parks, finance, etc.) or their attendant 200+ programs. Why? Because Council didn’t feel the financial pressure to do so. Council has only recently thought about long range, 5 year financial planning. Prior to this, the budget bumped along year to year with little vision of its impact on the future. If city government had had any foresight it would have started weaning itself from, instead of addicting itself, to gambling money years ago.
Even today, Council can’t tell you where the budget “cut line” exists; their budget priorities; what they would cut or add if finances changed; they have no contingency plan for budget shortfalls other than raid the reserves or threaten a tax hike. When I suggested we plan for a 3% budget cut for 2008 as a contingency to account for the real estate collapse and recession, I was rebuffed. Certain council members, who coincidently support gambling, felt that even planning for a small budget cut was unnecessary since we had enough in reserves to cover any shortfall. Well now the chickens have come home to roost and Lakewood faces a shortfall that may extend well into the future (TNT “Lakewood squeezed by slow down in real estate sales; 05/36/08).
In past City budgets the police department has always been the first thing on the chopping block despite being given lip service as the top priority. Seldom, if ever, are similar cuts proposed for any of the other 17+ functional areas. This is a tried and true tactic by government: threaten essential services while shielding less or non-essential services to bully citizens into paying more in taxes. During the 2008 budget deliberations we actually had citizens begging the City to raise their real estate taxes rather than cut the police: music to a politician’s ears. So can Lakewood survive without $2.5M in gambling revenue? It most certainly can.
The first step is for the City to get its financial house in order and prioritize its budget. We cannot continue to use “base line budgeting” and just pile onto last year’s budget without prioritizing everything government does annually. Government expands to the level of tax
revenues and small government advocates should limit government growth by cutting revenues first: gambling is a perfect place to start. Employee pay and benefit policies must be reviewed. Currently City salaries are among the highest in Western Washington (up to 150% higher) when compared to Lakewood family household incomes paying the tax bill. Yet Lakewood continues to chase the salaries of high cost cities such as Bellevue and Kirkland. A budgetary day of reckoning is coming gambling or no gambling.
Lakewood also must put the emphasis on economic planning and development. If casinos were banned, their properties would be taken over by other businesses which would generate tax income to the city. Real estate values and taxes would climb across the board: who wants to live or own a business in a community that fosters gambling? Studies have also shown that local sales taxes grow much faster in gambling free cities because money is not being siphoned off into that bottomless pit called a casino. Additionally, the city is spending $9M for sewers to revitalize Tillicum/American Lake Gardens and $7M to revitalize Ponders. These projects will also add significantly to Lakewood’s tax revenue. Economic growth, not gambling growth, should be the hallmark of Lakewood’s fiscal foundation and future.
Ultimately, $2.5M in gambling tax money is a false economy. The question is not whether Lakewood can survive without gambling but whether Lakewood can survive with gambling! Over the next 10 years $350,000,000 … YES MORE THAN 1/3 OF A BILLION DOLLARS … in direct and indirect costs will be sucked out of our economy by casinos. How can you not expect it to have an economic and social impact on the City? We must
work hard to develop a viable economic future and not become dependent on the luck of gambling’s “easy money” to do it for us. Anyone who depends upon gambling money to pay their bills is by definition an addict. Gambling, like crime, doesn’t pay: it costs everyone.
If you’d like to learn more about the impact gambling has on Lakewood and become part of the solution, I’d invite you to go to www.SaveLakewood.com. Find out how you can help bring the current initiative to ban casino gambling to a vote of the people. Time is short for signature gathering (4 July 2008) and we must have enough signatures (about 5,000) to qualify the initiative for the ballot.
Your help is vital! You can make a difference! Direct government via the initiative process when government fails to act: a clear winner for Lakewood voters! Please forward this e-mail to people on your personal mail list and urge them to act. Petitions for your signatures can be downloaded from www.SaveLakewood.com.
One more thing. If you believe that the people of Lakewood should not have to support the gambling industry in our community, send your council members an e-mail at firstname.lastname@example.org.
Past Council member and Deputy Mayor
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