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Fiscal analysis: Sports betting wouldn’t bring big tax boost

December 28, 2018

SIOUX FALLS, S.D. (AP) — A South Dakota ballot measure to legalize sports betting in Deadwood wouldn’t be a huge moneymaker for casinos or bring in much tax revenue, according to a legislative financial analysis. But supporters say it would help keep the historic mining town competitive as a gambling destination.

The analysis, released this month by the Legislative Research Council, estimates that the constitutional amendment would result in roughly $2 million in casino revenues and about $185,000 in new tax collections for the budget year it takes effect. Deadwood gambling revenues were roughly $100 million in 2017.

Deadwood Gaming Association executive director Mike Rodman said supporters never thought allowing sports betting would have a major effect on tax collections. But he said it would be another amenity for Deadwood to attract more visitors and, hopefully, result in more stays at hotels and meals at restaurants.

“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.”

The group plans to ask state lawmakers to put the amendment on the 2020 ballot.

Republican Sen. Bob Ewing, whose district includes Deadwood, plans to sponsor the measure during the upcoming 2019 legislative session. He said putting the change on the ballot gives everyone an opportunity to vote on it.

House Majority Leader Lee Qualm, an opponent, has said he believes the measure will spur a “very heated discussion.”

Rodman has said his association envisions that players would have to be physically at a casino to place a bet on a sporting event. The proposed constitutional amendment would give the Legislature the authority to implement the wagering in Deadwood and at tribal casinos. If sports betting gets voter’s blessing in 2020, it could be available by July 2021.

The fiscal analysis found that of the roughly $185,000 in new tax revenues for state budget year 2022, most would go to the state general fund and into a tourism promotion fund.

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