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By T.W. Budig
ECM Capitol reporter
 The statewide smoking ban is clearing the air but charitable gambling may be gasping.
According to a study by the Minnesota Gambling Control Board, the statewide smoking ban, which went into affect Oct. 1, has accelerated the rate of decline in charitable gambling in Minnesota.
Minnesota Gambling Control Board Executive Director Tom Barrett testifies before a Senate committee on Monday (March 31) on a study dealing with impact of the statewide smoking ban on charitable gambling.
Gambling Control Board Executive Director Tom Barrett spoke of “obvious patterns” existing, speaking to a Senate committee on Monday (March 31).
Although charitable gambling prior to the ban was declining at more than two percent a year over the past five years, fourth quarter gross receipts from last year were down almost 12.8 percent from the year before — about $40 million, the report notes.
This is the largest drop in receipts since lawful charitable gaming was first regulated by the state in 1985.
Factoring out variables like the sluggish economy — lawful gambling is strongly affected by the business cycle and apparently, too, by gasoline prices — the report concluded that statewide the smoking ban accounts for between 7.5 percent and 8 percent of the 12.8 percent decline marked over the last three months of 2007.
Historical data suggest the smoking-ban related decline in receipts could top $100 million a year.
If charitable gambling organizations’ — veterans groups comprise 29 percent — expenses decline more slowly than the falling gross receipts, their net profits available for distribution could be significant smaller.
In some areas of the state that could translate into a loss in net proceeds by more than 20 percent, the report indicates.
The report concluded that it’s unlikely the decline in receipts will revert to preban levels.
“We don’t know,” said Barrett.
Minnesota leads the nation in the amount of charitable gambling, about $1.2 billion in total sales.
No other state is even close.
Although five charitable gambling games are offered, pull tabs account for about 97 percent of the action.
Some lawmakers thought the impact of the smoking ban on gambling could have been worst.
“I expected it to be greater,” said Rep. Jim Abeler, R-Anoka, of the House Health Care and Human Services Finances Committee.
“I thought it would be a third,” he said.
“To be off by seven or eight percent — that’s more than somebody hoped for but less than what people feared,” Abler said of the statewide average.
“It’s all a trade off,” he said.
“You know smoking does cause a tremendous amount of health care costs,” he said..
If receipts are down, that could mean people are spending their dollars in other ways — on food, college, household expenses.
“So for a person who is nervous about people gambling too much, there may be a silver lining to all of it,” said Abeler.
Rep. Tom Huntley, DFL-Duluth, House Health Care Cost and Human Services Finance Committee Chairman and smoking ban bill author, said about half of the state was already under smoking bans prior to the statewide ban going in to affect.
Mike Maguire of the American Cancer Society argued that charitable gambling receipts were already falling and that the woes of the gambling industry can’t be put on the back of the Freedom to Breathe Act.
But Sen. Jim Vickerman, DFL-Tracy, said during the committee hearing that he knew charitable gambling groups in his area had been badly hit by the smoking ban.
“I was caught in a difficult position,” he said of backing the legislation or being mindful of its impact.
Vickerman noted against the ban.
Although the Gambling Control Board among its recommendations suggested the Legislature consider additional forms of charitable gambling, Abeler deemed this unlikely.
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