The Future of Gambling in Oregon
We have bipartisan agreement around the values we share about gambling but lack a better method for coordinating to promote those values through effective policies.
“The Lottery is at tax on poverty.”
“Pushing betting to shady corners of the globe does nothing to protect customers or college athletes here at home.”
“Animal racing raises a lot of animal welfare concerns.”
As the Chair of the House Committee that regulates gambling, all of these comments came to my inbox in recent weeks. Oregonians have conflicting feelings about gambling. We enshrined the Lottery in our Constitution, but also worry about the negative impacts of problem gambling. We took our last big look at the subject 25 years ago. Decades later, we’re starting to see the need to address the changing landscape, including the challenges of online gambling, a return to more horse racing, and ensuring all of our gambling outlets connect to our problem gambling treatment programs.
Who does what?
Oregon has three forms of legal gambling. First, the Oregon Lottery operates sports betting, mega-bucks style games, scratch-offs, and machines for video poker and similar games. The Lottery Commission has the constitutional charge to operate with, “the highest standards of security and integrity to earn maximum profits for the people of Oregon commensurate with the public good.” On the “maximum profit” front, the Commission has done quite well; the Lottery has become the state’s second largest source of revenue.
Second, Oregon’s Native American tribes operate casinos on tribal lands through gaming compacts with the Governor. As tribes are sovereign, the gaming compacts serve as the primary vehicle for ensuring the public good for both Native and non-Native Oregonians.
Third, and finally, the Oregon Racing Commission, with members appointed by the Governor, regulates betting on animal racing. While Portland Meadows has closed, Grants Pass Downs is now fully operational.
What are the major problems?
Oregon faces three major problems in maintaining the balance between generating revenue from gambling and protecting residents from its negative side-effects. First, we currently lack a mechanism to coordinate activities of the three entities allowed to sponsor gambling. This lack of coordination makes it harder to keep the aforementioned balance.
Second, offshore black-market gambling operations exist, despite federal regulations prohibiting their operation within the US. These create problems that include prohibited game types, inadequate age or identity verification methods, a lack of access to problem gambling tools, and a lack of tax reporting.
Third, we lack a common approach to address problem gambling. We do fund problem gambling services through Lottery revenues, but we need better tools to connect people to services. When polled, participants in these programs identified in-person, high speed-of-play games as causing them the most problems. These Lottery games have a disproportionate contribution to problem gambling.
A fourth, broader issue is the State’s reliance on gambling-generated revenue. Candor requires that we acknowledge the role gambling places in filling state coffers. Every district in Oregon has benefited from lottery bonds to fund important local needs. Any restrictions on gambling have to consider the impact on the debt service for those bonds.
What should we do?
Looking into the future, we clearly need to work together to ensure that gambling offers a healthy form of entertainment but not a source of addiction.
First, we should set up a structure for coordination between the Tribes, the Lottery, and the Oregon Racing Commission. We know that online gambling can be particularly problematic, but we inadvertently allowed high speed-of-play games online through the Oregon Racing Commission. Instead of the horse-racing bets we’d intended, we got an app that was essentially online slots. I fought hard and succeeded in pushing through SB 165 this session, which will curtail addictive online games.
This coordination is essential to readying Oregon for looming questions related to gambling. For instance, should we look at expanding sports betting through the Lottery to include college sports? While college sports betting is popular with voters, the NCAA has concerns about the impacts on college athletics. A collaborative, consensus-based approach among the legal gambling providers in Oregon could help us address these problems and plan for the next 25 years of safe gambling.
Second, we need better tools to stop offshore gambling from reaching into Oregon. Our Constitution prohibits private casinos, but that’s exactly what’s behind the proliferation of online games. Not only do these outfits have little interest in preventing problem gambling, but they also act as a means for money laundering and child support evasion. Their existence undermines our attempts to address problem gambling through limiting the kinds of games that are available through the Lottery and Racing Commission. Let’s be clear – these are already illegal, but the federal government has not done its job in preventing them from operating in the US. In their absence, it’s up to us to protect Oregonians from predatory offshore enterprises.
Finally, we should come to a common agreement about how to address problem gambling across our three legal forms of gambling. For instance, Las Vegas casinos recognize that the highly lucrative high speed-of-play games can incentivize problem gambling. That’s why they track gamblers through their use of cards or tokens in order to offer help if it’s needed. However, our in-person Lottery games don’t always require any form of identification, meaning we have no ability to figure out who has a gambling problem and offer them resources to address it or to enforce self-imposed limits for these games.
To their credit, the Lottery’s online options do have this functionality and have set the standard for the rest of the country. I appreciate that most Oregonians have a somewhat libertarian outlook on gambling, but we are not heartless. We believe in getting people the help they need. A coordinated set of policies across our legal gambling platforms is an effective way to support vulnerable people. Can we share data across the Lottery, Racing Commission, and Tribal Casinos to facilitate treatment and self-imposed limits?
In sum, we have broad, bipartisan agreement around the values we share about gambling. What we lack is a better method for coordinating to promote those values through effective policies that allow gambling as a responsible entertainment while preventing its abuse. To get there, we’ll have to put some work in over the coming months.
Marty Wilde is a member of the Oregon State House, representing District 11.
Photo credit: "Slot Machines" by ragingwire is licensed under CC BY-NC-ND 2.0