Those Meager Casino Rake Offs

More and more states are looking to casinos for revenue, and more and more officials are apt to be disappointed. Steven D. Gold, director of the Center for the Study of the States at the State University of New York at Albany, says revenues from casinos and other forms of gambling may be modest, and that costs could rise as well.

Lotteries, for instance, last year contributed an average of only 3.2% of tax revenues in the 36 states and the District of Columbia where lotteries operate. Although Nevada--a special case--earns about half of its revenues from casinos, the casinos in New Jersey bring in only about 2.5% of the state's revenues. As more states and Native American tribes open casinos, competition will divide the market, and casinos will cannibalize other gaming, such as lottery purchases, says Gold. Then, too, the presence of casinos can lead to more crime, and thereby inflate costs.

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