California's Casino Craze: Can the East Bay Beat the House?

Governor Arnold Schwarzenegger recently signed compacts for five new tribal casinos in California, but was only able to get the state assembly and senate to approve four. The legislators rejected a bill proposing a 5,000 (later reduced to 2,500) slot gambling hall in San Pablo located only 15 miles from Oakland and 19 miles from San Francisco. The San Pablo issue will be revisited next year and is expected to pass in some form.

Oakland residents have argued the pros and cons associated with establishing their own casino in the East Bay and the potential impact on crime, parking and traffic, jobs, and money for the city.

Mayor Jerry Brown rightly toyed with the idea. Why forgo the positives associated with gambling--such as higher employment and a boost in revenues for the city and local businesses--when the two most significant drawbacks will be foisted upon Oakland by the San Pablo Indian establishment anyway?

According to studies by a number of "special" and "not-so-special" interests –from gambling magazines and religious organizations to governmental agencies--the only agreed-upon negative is an 8 - 17% increase in personal bankruptcies for those communities located within 50 miles of a large gambling hall. An increase in crime is not a proven factor.

The substantial hike in pathological gamblers disproportionately burdens the most financially disadvantaged cities, such as Oakland, and each problem gambler costs the local region approximately $10,550 over his/her lifetime.

A second drawback corresponds to the additional cars on the road, especially since San Pablo is likely to be the terminator of all casinos, exceeding the size of the MGM Grand in Las Vegas.

The Governor makes no provision in the compact to offset the fiscal impact on Oakland. The city of San Pablo and the county of Contra Costa receive minor funding to compensate for the cost of increased local services, such as police and ambulance, which go hand in hand with any tourist attraction. The state of California gets the bulk of the chips: cash in advance, plus 25% of the profit.

Worst of all, communities within "The Dead Zone" are deprived of self-determination; in other words, they cannot decide whether they want to be part of the California casino craze. Experts believe that casinos will spread and gambling revenue in the state will surpass that of Nevada by 2010, upwards of $9 billion per year.

In the case of San Pablo, the Dead Zone is a "35-mile radius of exclusivity;" since Oakland is within this perimeter, it cannot establish its own casino until at least 2025. In fact, a gambling hall would be forever unlikely because once profits pour into the capital, there will be no stopping them.

The state of California will get their cut. San Pablo and Contra Costa County will receive jobs and pick up customers who might otherwise patronize restaurants, hotels, shops, museums and concert halls in the East Bay and nearby areas. Business bankruptcy rates are reduced by 35.4 percent on average when the establishment is in proximity to a casino; they will certainly increase when patrons are diverted to another locale.

Unless minds are changed in Sacramento, the East Bay will not be able to offset any San Pablo-related losses by negotiating a favorable deal for themselves. There won't even be an opportunity to vote on the issue. Casino opponents and supporters should agree on one thing: autonomy. Oakland should not stand by and let the state roll the dice for them.