South Dakota bet the town when it opened Deadwood to casino gambling three decades ago.
When two thirds of South Dakota voters approved that wager in November 1988, Deadwood was a dying historic relic 12 miles off the interstate with no money, no commerce and mostly boarded up buildings. Gaming has since injected the place with $350 million in public and private dollars. Crumbling infrastructure has been rebuilt. Gaming there currently supports roughly 1,300 jobs. Not a bad payoff.
Success didn’t come without costs, but so far South Dakotans have continued to support what they wrought. In 2014, 57 percent of state voters approved an amendment paving the way for keno, craps and roulette in Deadwood.
Gaming officials now seek lawmakers’ help in presenting voters with a constitutional amendment to enable sports betting there and in tribal casinos. A House panel dealt the measure a setback Monday, but a procedural move offers another spin of the wheel. The Senate has already voted to approve.
Without House support, Deadwood must collect nearly 34,000 signatures to bring the question directly to voters. Would anyone like to wager against their ability to do that?
Gov. Kristi Noem opposes making it easy for Deadwood to bring the vote forward, citing personal preference and financial reasons.
"Gov. Noem has made it clear that she does not wish to have gambling expanded in South Dakota," Revenue Department Deputy Secretary David Wiest told lawmakers Monday. The administration also argues that regulatory costs would exceed revenues generated.
The latter might be true. A recent analysis by the Legislative Research Council estimates the constitutional amendment would result in roughly $2 million in casino revenues and about $185,000 in new tax collections during FY2022. Total Deadwood gambling revenues were roughly $100 million in 2017.
In Nevada, sports books contribute only 2.4 percent of gambling revenue statewide — dwarfed by the proceeds from table games and slots. Even so, March Madness still makes for an impressive Vegas party.
Deadwood Gaming Association Executive Director Mike Rodman acknowledges sports betting wouldn’t be a big payoff for Deadwood, but he argues state casinos must stay current in an increasingly competitive environment. Political handicappers estimate sports betting could soon expand to 20 states. The floodgates were opened last year when the U.S. Supreme Court struck down a 1992 federal prohibition.
"We certainly think that it is important that Deadwood maintain itself as a competitive gaming destination," Rodman said. "We need to have those same game types that other destinations have."
Sports betting proponents say approval could encourage visits from a younger crowd and help stabilize the casino workforce over slow winters.
In the grand scheme, any small deficit in regulatory cost was long ago underwritten by the gambling proceeds collected over a generation. The state should be willing to write off any paltry incremental debt as winter tourism promotion.
As for state gambling, that horse left the barn long ago. After three decades of the grand experiment, is sports betting the place to draw a line in the sand?
We say let the voters decide.
We suspect they will anyway.