Gaming in Alaska

The Alaska Department of Revenue has commissioned a study to examine the potential for gaming in Alaska.

A $400,000 feasibility study the Revenue Department commissioned on gambling expansion in Alaska will look at the potential for casinos, sports betting and other forms of legal gaming and how the state might develop them.

The study also will look at where to locate potential land-based gambling operations as well as the projected economic, public safety and social impacts. These are just some of the broad areas that the feasibility study will cover. 

The state's preference for the study is to examine potential legal gaming forms that would boost tourism, generate revenues and help the economy, according to documents obtained by the News-Miner. Those documents include a signed contract with the vendor, a request for proposals (RFP) and a set of questions and answers regarding the RFP.

According to the RFP: "The State of Alaska is one of the few remaining states to expand opportunities for legal gaming. Under current law, legal gaming is fairly limited (pull-tabs, bingo and raffles for charitable organizations). The State has no other permissible gaming and so no lottery, sports-betting or casinos."

The Innovation Group, a global gaming consultant based in Colorado, signed a contract in March to conduct the study, which is expected to be completed by Aug. 31. The company states on its website that it has “helped bring many of the world’s largest entertainment and hospitality developments to life.” The company's clients include Caesars Entertainment, Hard Rock Cafe International, Hilton Hotels and Resorts, Planet Hollywood and Trump Entertainment Resorts.

Gov. Mike Dunleavy has said that he would support a gambling expansion in Alaska to generate revenues and offset deficits. He has stated that it could bring "high-paying jobs" to Alaska communities.

In the question-and-answer document, the state indicated that it would consider creating a gaming commission to authorize and regulate gambling in Alaska.

According to the document, the state is most interested in gambling forms that would improve the tourism economy:

"Question: Should we assume that the drafting of enabling legislation and regulations [for commercial gambling] would include land-based gaming, mobile gaming and a lottery?"

"Answer: The legislation could include all of those but will likely be focused on the approach to expanded gaming that will be most likely to generate the largest increase in jobs and tourism."

Under current law, the state allows limited nonprofit gambling with proceeds going to charity.

Deputy Revenue Commissioner Mike Barnhill said Tuesday that he expects to have the feasibility study in hand soon.

The Revenue Department signed the contract with the Innovation Group, with the RFP indicating work was to commence on April 1.

The Innovation Group has until Dec. 31 to fulfill its contract. The agreement may be extended for up to a year.

The completed study will be shared with Dunleavy and the Legislature, Barnhill said.

The Innovation Group offers a range of services to large-scale clients, including research, planning, development and casino management. 

The company’s contract with the Alaska Department of Revenue states that it will consult on “all aspects of evaluation, implementation, and legislation drafting services with respect to expansion of legal gaming in the state of Alaska.”

'Unique to Alaska'

The contract further states that gambling in the state should be an “experience unique to Alaska” with the objective to grow the economy, increase tourism, enhance the tourism experience and increase employment.

The company’s study will focus on economic impacts, a recommended tax structure, potential revenue streams to state and municipal governments, and an evaluation of regulatory challenges and guidance, among other areas.

The consultant will seek comments from stakeholders, including policymakers, community representatives, advocates and opponents, and any individuals and/or groups that would be impacted by commercial gambling.

Michael Soll, a founding member of the Innovation Group, declined to comment on the forthcoming study, saying in an email to the News-Miner he was not entitled to discuss the "status of our work."

The Innovation Group has offices in Denver, New Orleans, Las Vegas and Orlando, though it has provided services to gambling entertainment operators throughout the world.

Dunleavy said in a January speech that Alaska cannot “afford to deny itself a revenue stream available to nearly every other state in the nation,” in reference to commercial gambling.

Rep. Mike Prax, a North Pole Republican, said Tuesday he looked forward to seeing the report.

“In general, I am not opposed to expanding gambling," Prax said. "It is up to the individual to decide if they want to participate. Some people enjoy it and others do not.”

Former Senate President Catherine Giessel, who served in the Legislature for a decade, publishes a newsletter on state politics. She noted in her July newsletter the governor's interest in gambling expansion and the $400,000 study.

"I believe gambling will hit the lowest income Alaskans the hardest," she said in an interview with the News-Miner.  "I worry about their families and their future as the state makes an addictive behavior more accessible." 

Contact political reporter Linda F. Hersey at 907-459-7575 or follow her at twitter.com/FDNMpolitics.

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