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Casinos, public schools uncomfortably aligned in Proposition A

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Of the two entities that stand to benefit most from Proposition A, Missouri's casinos appear more enthusiastic about the statewide ballot initiative than public school districts.

Prop A would provide a new revenue stream for most school districts by raising the state tax on casinos 1 percent and removing Missouri's much-maligned $500 gambling loss limit. Established in 1992, the limit prohibits casino patrons from buying more than $500 in chips or tokens within a two-hour period.

But despite the best efforts of Prop A proponents, many school administrators and educators are reluctant to endorse the unorthodox - some even say unethical - funding mechanism. Others are downright skeptical the funding will stay at projected levels and end up in school coffers as promised.

St. Louis-based Yes on A Coalition is leading the campaign for Prop A, which spokesman Scott Charton said would provide more than $100 million in additional revenue for elementary and secondary schools statewide.

Charton said many casino patrons throughout the Midwest already avoid Missouri's casinos because they view the loss limit as a hassle and an ineffective way to curb problem gambling. Voting against Prop A would keep Missouri's casinos at a competitive disadvantage and block additional revenue for public schools, he added.

"With a lot of propositions, if a voter doesn't understand it, they vote no," Charton said. "A no vote (on Prop A) is not the status quo. (Passage) would allow Missouri casinos to compete on equal footing with other states."

School officials skeptical

In February, the State Auditor's Office projected Prop A would generate between $105 million and $130 million annually for Missouri schools, but the estimate failed to account for revenue from two St. Louis-area casinos under construction. By figuring in those casinos, Charton's group estimated that annual school revenue from Prop A would range from $126 million to $144 million.

Based on the auditor's original estimate, Missouri Department of Elementary and Secondary Education officials have calculated the financial benefit to hundreds of school districts and posted the projections at www.dese.mo.gov.

By plugging a "middle-of-the-road" annual revenue figure of $118 million into the state's school funding formula, DESE estimates Springfield Public Schools would receive about $1.9 million annually, said Gerri Ogle, associate commissioner of administrative and financial services.

Some school districts, however, won't see any money from Prop A. Ogle said wealthier districts are at a "hold-harmless level," which means they already receive more local and state revenue than what's required under the funding formula. No districts in the Springfield area fall into that category.

Springfield Public Schools Board of Education has had no formal discussion about Prop A, but President Kris Callen said she's dubious about the funding proposal. She pointed to the Missouri Lottery, which has been criticized for failing to safeguard school funding. The lottery, which directs about 27 cents from every dollar to public education, accounts for 4 percent of the state's total education funding.

"I'm always skeptical of measures that go outside of the traditional framework of the legislative body," Callen said. "Any time you can have legislators who are personally or corporately responsible for their vote and their actions, you have more accountability. ... My concern is that we don't take away the responsibility of all citizens to pay for public education by balancing that on the back of people who choose to gamble."

Nixa Schools Superintendent Stephen Kleinsmith was similarly uneasy about removing casino loss limits to fund public education.

"It's a soft (revenue) source that's dependent on families' and individuals' loss through the activity of gambling," he said. "Can you really plan your budget around a soft source of income? I don't think so. I think it's too risky."

If Prop A passes Nov. 4, the Nixa R-II School District would see an estimated $417,000 annually in new revenue, according to DESE. Kleinsmith said additional school funding is necessary, but that it should come from a more conventional source, such as a sales or property tax.

Casinos propel campaigns

Kleinsmith and other critics of Prop A have noted that statewide educational organizations, such as the Missouri Association of School Administrators, have been unwilling to endorse the ballot initiative.

Most of the organizations that have endorsed Prop A are business-oriented, according to www.yesonpropa.com. The list includes several chambers of commerce in the Kansas City and St. Louis areas as well as the Missouri Chamber of Commerce and Industry and Associated Industries of Missouri.

The Springfield Area Chamber of Commerce has not taken a stance on Prop A, though it is hosting an Oct. 13 forum to discuss the measure.

Companies that own Missouri's largest casinos have funneled millions of dollars to the Yes on A Coalition. Ameristar Casinos Inc., which operates casinos in Kansas City and St. Charles, and Pinnacle Entertainment, the Las Vegas-based company building the two new casinos in St. Louis, together have spent more than $8.5 million on the Prop A campaign, according to the Missouri Ethics Commission.

Prop A also limits the number of casinos in Missouri to 13, including those in operation or under construction.

Charton said that a casino preparing to open in Kansas City, Kan., is positioned to siphon some $174 million in gaming revenue from casinos right across the border in Missouri that are hamstrung by the state's loss limit. He said problem gamblers circumvent the limit by visiting numerous casinos in larger metropolitan areas or having someone else purchase chips or tokens for them.

"It's not an effective deterrent," he said.

By erasing the loss limit, Missouri casinos will draw in more patrons and, in turn, provide more funding for schools under Prop A. On a per-student basis, though, the payoff is less than $140 annually.

"That wouldn't even buy the textbooks for one high school student," said Brenda Rantz, finance director for Nixa public schools.[[In-content Ad]]

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