On Monday, the Chairman and CEO of casino and hotel giant MGM Resorts International told local business and civic leaders that Las Vegas-style gambling, including a $1 billion-plus resort in Atlanta, could be an economic engine for the state and could boost the lottery-funded HOPE Scholarship program.
MGM chief Jim Murren’s visit to the Rotary Club of Atlanta came weeks after a study by an education coalition, backed in part by gambling interests, found that the program could face financial challenges in the years ahead despite a record $1 billion pumped into education programs last fiscal year.
His remarks may preview a renewed — and still uphill — effort in the state legislature to legalize casino gambling. Opponents range from faith-based groups to some business interests leery of the industry. Gov. Nathan Deal also has opposed efforts so far.
Murren said Georgians spend $600 million a year at casinos outside the state, according to MGM research. That money, he said, does not create local jobs or benefit education.
Murren told The Atlanta Journal-Constitution in an interview if his company were allowed to operate in Georgia, MGM could spend more than $1.4 billion on “an integrated resort” featuring a casino, hotel, concert hall, restaurants and shopping.
The complex would employ perhaps 4,000 people and complement Atlanta’s hospitality industry, he said.
“This is a tremendously appealing market,” Murren said.
A recent study by an influential downtown Atlanta business group, however, said most visitors would be locals, not tourists, and that spending in casinos could “cannibalize” spending that would have gone to other local businesses and events.
Mike Griffin, public affairs representative for the Georgia Baptist Mission Board, said tens of thousands of dollars in campaign contributions have gone to lawmakers from casino interests, which have also deployed dozens of lobbyists.
“I think one of the most egregious things I hear in all of this is that it’s all for the children,” he said, citing damage to families from gambling addiction and other social vices. The casino and racing industries, he said, “have taken a big hit over the past few years and they are looking for new frontiers and places where people are not nearly as educated about the detriments.”
A constitutional amendment to allow up to four casinos — including two in metro Atlanta — failed to gain traction in last winter’s legislative session amid opposition from Deal and House Speaker David Ralston. A message left with a Deal spokeswoman was not immediately returned.
Last year, MGM proposed a $1 billion-plus destination resort and casino in downtown Atlanta.
Murren said Monday such a facility would not compete with the lottery and would help drive new tourism business. He said about two-thirds of the company’s revenue comes from non-gaming sources such as events, food and hotel room-nights.
“We only go into markets where we believe we can provide a destination addition to a market,” he said. “We’re interested in the type of resorts that provide a nexus between entertainment, hospitality and gaming.”
Allan Vella, president and CEO of the Fox Theatre, asked Murren what MGM would do to protect existing destinations. Vella said casinos often need musical acts and other events to help draw traffic, and can pay more than nonprofits such as the Fox.
He said that could be “potentially devastating” to smaller groups.
Murren said his company funds many nonprofit arts groups and that landmarks such as the Fox will “find us to be a great ally not an adversary.”
He said MGM has not picked a location for an Atlanta resort but wants to be close to the airport and the region’s convention scene.
David Marvin, CEO of Legacy Ventures, which owns several downtown hotels and restaurants, said he is undecided on casino gambling, but has reservations about a resort siphoning business from existing downtown attractions.
Marvin, a member of Central Atlanta Progress, which commissioned the report warning of potential business cannibalization, said he could see a resort outside downtown but within the metro area being of potential benefit to the region.
“I think the stakes are high and I think MGM and their competitors are willing to come back year after year after year,” he said.
A boost for HOPE?
Backers say legalizing casinos could pump hundreds of millions of dollars into lottery-funded education programs such as HOPE. The bill last year called for a tax on casino revenue to be directed to lottery-funded education programs.
The value of HOPE awards has been curtailed in recent years in the face of growing student demand and rising tuition coupled with a flattening revenue curve.
A poll commissioned by the AJC in January found 62 percent of registered voters in Georgia favor legalization in Georgia to support HOPE and other education programs.
The study by The Committee to Preserve HOPE Scholarships projected financial pressures on the program will likely get major play during the upcoming legislative session. But Jon Gabrielsen, a consultant quoted in the report, on Monday said despite the report’s conclusion of revenue being outstripped by demand by 2027-2028, policymakers can make adjustments without a new revenue stream.
State Sen. Brandon Beach, R-Alpharetta, who led a failed push for horse racing last winter and is also open to casinos, said he and other gambling backers want to save HOPE from further cuts.
“I want to make sure that we keep our best and brightest in the state of Georgia,” Beach said, calling HOPE’s continued strength a workforce development issue.