Nebraska cities that reap millions of dollars in tax revenue from keno bets asked the state's lawmakers Monday to let people play the game on their mobile phones to help bars and keno parlors compete with new casinos slated to open next year.
The idea drew strong criticism from gambling opponents and was met with skepticism from some lawmakers who questioned whether expanding the game beyond its current paper-only form would make a difference, the Associated Press reports.
Bellevue City Finance Director Richard Severson said keno has generated $7.5 million in local revenue over the last decade that city officials used to upgrade parks, fund domestic violence-abuse programs and promote economic development, among other initiatives. “Needless to say, that $7.5 million was very helpful without us raising property taxes or raising the revenue some other way,” Severson told the Legislature's General Affairs Committee. “This has been a very good program.”
Keno is a lottery-like game where players pick numbers on a sheet of paper and submit them to a keno operator, usually a bartender or parlor employee. Nebraska has allowed the game for decades, but the keno industry and city officials are worried they'll lose revenue after voters approved a constitutional amendment last year to legalize casino gambling, a flashier alternative with more ways to bet.
If approved, the measure folded into a larger gambling-regulation bill would allow keno players to bet using their mobile phones, with an app linked to their bank accounts. The proposal would forbid players from using credit cards on keno bets and would require apps to include “geofencing” technology that would allow people to play only in buildings where keno is permitted.
Ralston City Administrator Rick Hoppe said his city could see a large revenue loss that would make it harder to pay off the debt it owes for an arena project that has failed to meet expectations. Hoppe said he needs to be able to show credit agencies that the city has a reliable source of income it can use to continue paying the debt. Losing keno revenue is “going to throw a wrench into our plans,” he said.
Jack Cheloha, a lobbyist for the city of Omaha, said his city has used its keno revenue to buy police cars, pay for cleanup projects and pay off lease-purchase bonds on TD Ameritrade Park, the downtown baseball arena that hosts the College World Series.
Gambling opponents criticized the measure as an attempt to usher in a new form of gambling that goes beyond last year's casino legalization measure. It's also likely to have a disproportionate impact on the state's poorest residents, said Nate Grasz, policy director for the Nebraska Family Alliance. “Government should not actively seek to willfully cheat its own citizens,” Grasz said.
Some lawmakers said they were concerned a mobile app would make it easier for compulsive gamblers to blow their bank accounts, including those that are shared with a spouse. Others questioned whether casinos will actually hurt the keno industry once they're open.
Sen. Tom Brandt of Plymouth said he doesn't see bar-based keno games and casinos as competitors. “My experience is that regulars (of bars) go in there to drink beer, and keno happens to be there,” he said. “It's sort of a different crowd than those who would go to a casino."