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Michigan Casino Campaigns Face Difficult Challenge

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LANSING (WWJ/AP) – Eight years ago, Michigan casino owners spent nearly $20 million to support a ballot campaign that makes it far more difficult for their competition to set up shop in the state.

It’s been an effective strategy.

Since voters approved the 2004 constitutional amendment requiring most types of gambling expansion to be approved by statewide and local votes, only a few casinos owned by Native American tribes – exempt from the state law – have managed to open in Michigan. No gambling venture has mustered enough momentum or money to even make the statewide ballot and ask voter approval for their projects.

Two competing casino development campaigns hope that changes this year as they seek approval for a total of 15 new casinos across the state.

Campaign organizers note that winning statewide voter approval for casinos is not unprecedented. Michigan voters did just that in 1996, authorizing the three Detroit casinos that today form one of the nation’s biggest casino markets.

The state also has 22 tribal-owned casinos, which combined with the Detroit gambling halls give Michigan a nearly $3 billion casino industry. Revenues for the Detroit casinos grew a combined 3 percent in 2011 and overall tribal casino business also is on the rise, helped by the new outlets.

“Our gaming industry is doing very well,” said Emily Palsrok, a spokeswoman for the Citizens for More Michigan Jobs campaign seeking approval for eight casinos in the state. “It is a business now, and we want to improve upon that business.”

Supporters of gambling expansion would have to collect nearly 323,000 valid voter signatures just to qualify a proposal for the November ballot. And if they made the ballot, they’d face an expensive showdown with entrenched casino owners.

The high threshold set by the 2004 voter-approved measure has thwarted other commercial gambling expansion efforts, notably from Michigan’s horse racing industry, which has unsuccessfully sought to add slot machines and other casino games at their venues for years.

The latest gambling expansion proposal has drawn opposition from a coalition of casino owners arguing the state already has enough casinos. The Protect MI Vote coalition includes the MGM Grand and Greektown Casino in Detroit, the Saginaw Chippewa Indian Tribe and the Nottawaseppi Huron Band of the Potawatomi.

“We feel this is an irresponsible proposal,” Protect MI Vote spokesman James Nye said. “We’re in a state that simply doesn’t have the population or type of economy that can support that type of expansion.”

Critics of expansion also note that Ohio is ramping up its casino business, which they say could hurt the Michigan market.

Arguments about the size of the Michigan market aside, it will take money and voter persuasion to make the ballot and win in November.

Citizens for More Michigan Jobs says it wants to raise $50 million for its ballot campaign. If successful, it would allow new casinos in Detroit, Pontiac, Grand Rapids, Romulus, Birch Run, Macomb County’s Clinton Township, Wexford County’s Clam Lake Township near Cadillac and DeWitt Township in the Lansing area. Palsrok said these new establishments would help boost the local economy.

“… Both in the construction of the casinos and the jobs at the facilities, and even new jobs in surrounding areas of what the casinos will bring to the communities,” said Palsrok.

A separate group called Michigan is Yours, whose backers include former Detroit Lions star Billy Sims, is trying to make the ballot again this year after failing to gain momentum and collect enough signatures in 2010. Michigan is Yours seeks permission for casinos in Benton Harbor, Detroit, Grand Rapids, Lansing, Port Huron, Romulus and Saginaw.

There’s some bad blood between the campaigns, at least on the Michigan is Yours side. Michigan is Yours says former state House Speaker Rick Johnson, now with Citizens for More Michigan Jobs, was once affiliated with their campaign. Michigan is Yours organizers say Johnson tried to steal their concept and they’re upset that state election officials haven’t blocked the newer campaign from proceeding. Michigan is Yours filed suit against the state in federal court but its request for a temporary restraining order was denied.

Citizens for More Michigan Jobs says it has a different approach to expanding gaming than Michigan is Yours and that the lawsuit is unfounded.

Citizens for More Michigan Jobs says it has a better-funded campaign. Both groups are trying to entice voters to support them by touting employment opportunities and tax revenue that could help public projects.

Citizens for More Michigan Jobs proposes a 23 percent wagering tax. About 30 percent of that tax money would go to public schools, while 20 percent would go to support police and fire services statewide. Another 40 percent would go to counties, cities, townships or other local governments where casinos are located. The remainder of the tax would go to fund road repairs and gambling addiction prevention programs across the state.

The tax from casinos within Detroit would be distributed differently, with money going toward police and fire within the city, and schools and road construction statewide.

Michigan Is Yours promotes local tax benefits and money for a college scholarship program among its features.

Michigan is Yours co-chairman Darryl Mathis said he hopes voters would consider the proposal as an opportunity to help create jobs and boost tax revenues for communities across the state.

“A lot of places in Michigan need this kind of help,” said Mathis.

TM and © Copyright 2011 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2011 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed. The Associated Press contributed to this report.

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