State gambling proposal attracts big-money interests

By JACK STOREY/The Evening News SAULT STE. MARIE - As the electoral season winds toward its final week, no statewide issue has attracted the attention of powerful interest groups and big-money contributors like Proposal One on this year's ballot. If approved by voters, Proposal One would amend the Michigan Constitution by requiring extraordinary approval referenda for most additional legal gambling, excepting casinos operated by Indian tribes and the three casinos in Detroit. The Sault Tribe of Chippewa Indians is among the state Indian tribes supporting Proposal One. Among local officials, Sault Mayor Tony Bosbous and four members of the Sault City Commission recently made a point of going on record in favor of the statewide gambling amendment. Under the proposal's provisions, any move to install gambling operations not excluded under the language must be approved by local voters and voters statewide. The requirement for two separate referenda is viewed by many as a virtual ban on additional wagering games anywhere in the state. The proposal gives the Michigan Legislature, the state's deliberative body, no say in the granting of additional gambling operations in the state. In seeking to amend the state constitution, the proposal places the question effectively beyond the legislature's reach. Heavily supported by the several Indian tribes and Indian-owned casinos around the state, the proposal is described by backers as a measure to "let the voters decide" on additional gambling in the state. However, the dual public referenda required for additional gambling under the proposal places a burden on sponsors that virtually assures no additional gambling will be approved in the state. Few or no other provisions of the Michigan Constitution require both a local and statewide referendum on questions of public policy. The proposal also requires voter approval of any expansion in Michigan Lottery games to include "table games" or "player operated mechanical or electronic devices," meaning slot machines. The proposal was drawn and circulated after tribal officials failed to convince the Michigan Legislature to ban so-called "racinos" at horseracing tracks around the state. The tribes view slot machines at racetracks as likely competition for the dozen or so tribal casinos in the state. Proponents of Proposal One have mounted an extensive statewide advertising campaign to boost passage of the constitutional amendment with a heavy emphasis on expensive television commercials. In the TV advertisements, backers do not mention the state lottery or racetrack slot machines, instead using a number of local officials to promote the voter approval feature of the state proposal. According to published accounts, Indian tribes and the three Detroit casinos have amassed a war chest of $12.6 million to promote the proposal. Opponents, which include state officials, labor unions and other groups contend adoption of the amendment will hamstring the Michigan Lottery, reducing the approximately $600 million the lottery generates for Michigan schools. Like the proponents, the opposition fails to mention certain information in its advertising. Opposition advertising leaves out the primary source of campaign funding, racetrack owners. The opposition side has raised significantly less for campaign expenses, an estimated $3.4 million, statewide. Like the proponents, opposition funds have devoted a significant share of their limited treasury to television advertising featuring Gov. Jennifer Granholm and state Republican legislators. The dueling TV ads on the proposal have generated a side issue from an opposition claim that tribal casinos pay little or nothing in state taxes. The tribes respond that their casinos have paid some $234 million in state gaming taxes over the last 10 years, a fraction of the lottery's annual contribution to schools. Tribal backers also contend Indian casinos have paid some $117 million to local governments and non-profit organizations over the years. Some tribes halted their eight-percent payments to the state when the three Detroit casinos opened in the 1990s but still make local "two-percent" contributions. Indian backers of the state proposal charge opponents of "racism" in raising the taxation question. Opponents deny the racism charge and contend instead that Proposal One is a tribal move to give Indian casinos a "monopoly" on casino gambling in the state. It is not clear from the wording of Proposal One and the overheated exchanges between backers and opponents how the proposed constitutional amendment will affect the hundreds of small, mostly local raffles and drawings held by disparate groups for fund-raising purposes. A vote for Proposal One is a vote in favor of the extraordinary required referenda for expansion of casino and slot machine gaming with the exclusion of Indian and Detroit casinos from its terms.