La Crosse Tribune: Who's gambling?

Who are the 1.6 million visitors projected to visit a HoChunk Nation casino in La Crosse?

Tribal spokespeople told the media last week these visitors would be "new" to the area and wouldn't visit La Crosse without a casino here. Bringing in new visitors is key to their argument that a casino won't hurt existing businesses.

But according to experts on casino gambling as well as the Ho-Chunk Nation's economic impact analysis, the majority of the visitors will be area residents, not tourists and visitors from a great distance.

The La Crosse County Board will vote Thursday whether to hold a countywide advisory referendum in November on a Ho-Chunk casino. The tribe promised county and city government a total of $4 million a year in lieu of taxes.

"If the projections are correct, and they are projections, they're saying 1.6 million new people will be coming into this area," said Ho-Chunk legislative attorney William Boulware. "I don't see how 1.6 million new people coming to the area can hurt the taverns, because that would be people who would not normally be coming here who are now coming here providing additional sources of income, new dollars to the community."

"When in full operation, the facility will have a total projected economic impact of approximately $100 million," said Wade Blackdeer, a Ho-Chunk legislative representative. "Most of these dollars would be generated by increased tourism to the La Crosse area."

Professor William Thompson of the University of NevadaLas Vegas questioned the Ho-Chunk's statement that 1.6 million new visitors would come to La Crosse to gamble, saying that most of the casino patrons will come from within a 50-mile radius of La Crosse.

"There's a proposal up in Hudson (Wis.) now where three tribes living 100 to 200 miles away will be taking the profits out," Thompson said. "The players will be from Hudson and Minneapolis/St. Paul region, and the money will shift out of the region."

Professor Earl Grinols of the University of Illinois at UrbanaChampaign, another casino expert, concurs with Thompson on the 50-mile market area, especially because of other casinos in the area. "A casino in La Crosse would not be so enormously different that people will pass up others to come there," he said.

The Ho-Chunk Nation's economic impact analysis says, "Based on the market assessment calculations, the casino should be capable of attracting 1,589,438 patrons in the year 2004. These patrons could be expected to generate $82.6 million in gaming revenues to the casino."

The economic impact analysis doesn't explain how those numbers were arrived at. Scott Fisher, managing director of Urban System Inc., the report's author, said in an interview Tuesday that the methodology is contained in a market analysis, which the Ho-Chunk Nation has not released. He said Urban System has done hundreds of market and economic impact studies for casinos around the country.

Fisher said he used a "gravity model" that looks at demographic and other data to determine the number of people in a market who would be inclined to visit a casino, as well as the number of visits they're likely to make.

Fisher said he looked at an area within 150 miles of La Crosse - the distance people would be likely to travel for a day trip. However, most of the casino patrons would come from much closer. "Beyond 50 miles, the competition becomes too stiff," he said.

Fisher said he estimates 43 percent of adults in the La Crosse market area have "a propensity to participate" in gambling. "That's relatively low to average, compared to a well-developed area, where the propensity is 50 to 60 percent," he said.

After figuring out how many people are likely to gamble, Fisher multiplies that by the number of visits those people will make to a casino. He estimates 13.5 visits per year, or a little more than one a month.

That doesn't necessarily mean those people will visit only their local casino, Fisher said. "Some of it is looking for variety," he said. People from Minneapolis may visit a local casino 10 times a year, but visit others within a few hours drive once a year, he said.

Fisher estimates out-of-town visitors will stay in local hotels, eat in local restaurants, drink in local taverns and buy goods in local stores. He estimates that will generate $13.07 million in new spending in the area.

"I stand by my statement that a casino will not cannibalize existing businesses," Boulware said Tuesday.

In a 1998 interview with the Kenosha News, Grinols said he doesn't buy the argument that casinos bring more business to a town. He told the Tribune Monday he still believes that.

"What I found is that gamblers come to gamble and do not come to do much else. If there is an increase in spending locally, it is primarily from the spending of the casino employees if the employees are in a location where they didn't used to be," Grinols said. "But there is definitely not an impact of outside gamblers ... they come in, do their gambling, get back in the car or bus and go home that's the end of them."