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High-stakes gambling initiative survives court challenge

Thursday, July 10, 2008 | 7:42 p.m. CDT; updated 3:39 p.m. CDT, Monday, July 21, 2008

JEFFERSON CITY — An initiative to allow high-stakes gambling in Missouri overcame a court challenge Thursday from opponents who claimed its official ballot summary could mislead voters.

The initiative targeted for Missouri’s November ballot would repeal a unique state law that limits gamblers to losing no more than $500 in a two-hour period. It also would cap the number of casinos that could operate in Missouri and slightly increase their taxes.

Opponents sued on claims that the ballot summary prepared by Secretary of State Robin Carnahan was insufficient and unfair. But Cole County Circuit Judge Patricia Joyce said none of the alleged wording deficiencies even came close to that illegal standard.

Had Joyce ordered different wording, she essentially would have barred the measure from the ballot because it’s too late for supporters to gather new petition signatures under a revised summary.

A group financed by Ameristar and Pinnacle casinos submitted petitions in May to Carnahan’s office. Local election officials are still verifying whether they got enough signatures from registered voters, and Carnahan has until Aug. 5 to certify initiatives for the November ballot.

The group sponsoring the measure calls itself the “Yes for Schools First Coalition” — a reference to the fact that casino taxes benefit public education.

The state auditor’s office estimates the ballot measure could generate up to $130 million annually for elementary and secondary education, up to $7 million for higher education and other state programs, plus up to $19 million for the governments where the casinos are located.

By removing loss limits, gamblers are expected to bet more and lose more, thus increasing the amount of money casinos make and the taxes they pay.

Missouri’s existing casinos contend the loss-limit repeal and the prohibition on additional in-state casinos both are necessary to combat increased competition from bordering states, particularly from newly planned casinos in Kansas.

As a result of the court ruling, “we can move forward to let the people vote on this important proposal to increase funding for schools statewide, by updating Missouri’s casino regulations and allowing Missouri to compete equally with neighboring states for casino visitors,” said Scott Charton, a spokesman for the coalition sponsoring the measure.

One of the attorneys who challenged the ballot summary on behalf of two St. Louis County residents said he had no comment about the ruling. The other attorney could not immediately be reached for comment.

Carnahan said in a written statement that she was pleased with the court decision.

“Our office has remained confident throughout this process that the language we wrote for the initiative is an impartial and accurate description of the proposal,” Carnahan said.

The lawsuit claimed Carnahan should have been more precise or provided greater detail, such as noting that loss limits originally were approved by voters in 1992. But Joyce ruled that didn’t make the summary illegally unfair or insufficient.

Among other things, the lawsuit also sought to strike wording noting the new tax revenues would be placed in the “Schools First Elementary and Secondary Education Improvement Fund.” Although that’s the official title of the fund created by the initiative, opponents argued the wording implied the money actually will result in improved schools and thus could unfairly cause some people to support the measure. The judge said that argument had no merit.

The lawsuit also claimed that the measure violates a constitutional requirement against covering more than one subject. The judge said it was too early to raise that claim, but it could be resurrected if the secretary of state’s office certifies the measure for the ballot.

The case is Edwin McKaskel v. Robin Carnahan, 08AC-CC00205.

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