| Charitable gambling organizations hit hard |
|
|
| Wednesday, 21 January 2009 | ||
|
This e-mail address is being protected from spam bots, you need JavaScript enabled to view it
Staff writer Many charitable gambling organizations did not make as much in fiscal year 2008 as they have previously. Decreased charitable gambling revenue first impacts American Legion posts, Lions clubs, VFWs and youth sports associations, but then in turn affects the recipients of those donated dollars.
Minnesota Gambling Board Executive Director Tom Barrett said the smoking ban and the economy are partially to blame for the net receipts decrease many organizations saw between fiscal year 2007 (July 1, 2006 to June 30, 2007) and fiscal year 2008 (July 1, 2007 to June 30, 2008). “There was apparently going to be more people coming out after the smoking ban, but instead it was a reverse effect,” said Shawn Donahue, gambling manager of the Spring Lake Park Lions Club. According to the Minnesota Gambling Control Board, annual gross receipts from charitable gambling had been decreasing an average of 2.5 percent each year the five years prior to the statewide smoking ban going into effect in October 2007. However, gross receipts plummeted 12.8 percent when comparing October through December 2007 with the same period in 2006. This is the largest percentage drop since charitable gambling was first regulated by the state in 1985, according to the March 2008 study. Net receipts are what a charitable gambling operation makes once prizes are given out. After net receipts, organizations have to pay “allowable expenses,” which are operational costs including salaries, rent, product purchases and supplies. Barrett said Minnesota state statutes allows organizations to use no more than 75 percent of net receipts made from bingo for these allowable expenses. No more than 65 percent of net receipts from other charitable gambling games can be used on allowable expenses. The challenge the charitable gambling organizations face, Barrett said, is they still need to pay the operational costs. According to Donahue, the Spring Lake Park Lions Club has reduced its hours of operation at its main office and at its charitable gambling establishments. Statewide, allowable expenses accounted for approximately 55.5 percent of net receipts in fiscal year 2008, according to the Gambling Control Board. The organizations also have to pay state taxes and fees. In fiscal year 2008, 22.25 percent of net receipts statewide were taxes and fees. Wayne Wallace, former charitable gambling manager at the American Legion Post 102 in Anoka, said a restructuring of the taxes paid would help these organizations. The taxes charged are 1.7 percent of the gross receipts on pull-tab and tipboard games, 8.5 percent on the net receipts of bingo, raffles and paddlewheels and a combined receipts tax, which is a progressive tax calculated based on the gross receipts from pull-tabs, tipboards and interest. Wallace is less than optimistic that the Legislature will restructure the taxes paid by charitable gambling organizations. “With the situation the state has now with the deficit, there’s no way the Legislature will re-do the tax structure,” he said. One concept being discussed at the Legislature this session is allowing video bar bingo games. It is a concept that Donahue likes because it would cut down on staffing costs and the younger generation prefers video games. Barrett said if all things remain the same, charitable gambling organizations will continue to struggle. “These organizations like everybody else are taking a fresh look at their operations,” Barrett said. Donations down Not all organizations are struggling as much as others. The Coon Rapids Youth Hockey Association net receipts went from $25,067 in fiscal year 2007 to $281,997. Adding two more locations helped, said gambling manager Michelle Picknell, but she also felt carrying games that had higher percentage payout drew people in. For the most part, organizations with charitable gambling dollars were hit hard in fiscal year 2008 compared with fiscal year 2007 and it has impacted donations. Wallace could remember the days when American Legion Post 102 could help the Anoka police and fire departments purchase equipment or when it was able to donate to the creation of a firing range for the Anoka Police Department. Today, it is much more difficult to make these types of donations, Wallace said. In fact, Post 102 had to decrease the amount it gives for eight scholarships for graduating Anoka High School students from $1,000 to $750. Wallace said his post has had to eliminate other donations or significantly reduce others. Robert Faucett, gambling manager for Coon Rapids VFW Post 9625 for the past 15 years, said it used to give $5,000 to graduating high school students going to Anoka Technical College, but this scholarship was eliminated. His post’s donations to the Boy Scouts and school groups have decreased as have donations to veterans in need. The Coon Rapids VFW now only donates to individuals and groups in Coon Rapids and communities that border Coon Rapids. “We just don’t have the money to donate,” Faucett said. Donahue said for a 10-year period from approximately the mid-1990s to the mid-2000s, the Spring Lake Park Lions Club donated over $1 million to the Spring Lake Park School District. This school district as well as Blaine High School are the biggest recipients of Spring Lake Park Lions Club money, so they have been impacted the most by decreased charitable gambling revenue, Donahue said. This has affected the music and athletic departments and the Opportunities in Emergency Care program that trains students in emergency medical services. Alexandra House in Blaine provides shelter and assistance for women and children living in homes impacted by domestic violence. Cuts that come directly from the state or come from state reductions to the cities that could result in to cuts to services organizations have a greater impact than decreased charitable gambling dollars, but they still have an impact, according to Alexandra House Development and Communications Director Amanda Vickstrom. “It’s had a significant impact considering we lost half of what we got from one city,” said Alexandra House Executive Director Connie Moore. Alexandra House requested $44,570 from the city of Blaine in 2009, but only received $17,500. Other cities have cut funding to the Alexandra House and the revenue source for some of these cities is charitable gambling, Moore said. The reason for the reduction from the city of Blaine was it projected to receive $70,000 in charitable gambling revenue in 2008 but only received $45,000. Blaine each year collects 10 percent of net receipts from the Blaine Lions Club, Blaine Youth Hockey Association, Sgt. John Rice VFW Post 6316, the Spring Lake Park Youth Hockey Association and the Spring Lake Park Lions Club. The Blaine City Council in December 2008 had to give other organizations like Central Center for Family Resources, Blaine’s Blazin’ 4th Committee and Creating Communities the bad news that cuts were on the way. Central Center for Family Resources (CCFFR) is a charitable organization that offers outpatient services, support and therapy groups to people with mental health issues in Anoka County and the surrounding areas. According to CCFFR data, the organization started to see a decline in charitable gambling donations from Lions clubs, VFWs, Kiwanis and area tribes in 2007, but it got worse after the smoking ban went into effect. In 2008, charitable gambling donations to CCFFR were cut by more than 80 percent. Patty Halverson, development manager for CCFFR, said these losses have especially hurt school based peer support groups for children, families and the chronically mentally ill. Half of all mental illnesses like major depression, anxiety disorders and substance abuse start by the age of 14, Halverson said. If untreated, these disorders could lead to higher rates of violence, school dropout, family dysfunction, juvenile incarceration, chemical dependency and suicide, she said. Due to the charitable gambling loses, CCFFR looks for more support from individual donors and local businesses, Halverson said. “It’s really made us step back and re-evaluate how we fund these programs,” she said. Local youth teams are also feeling the impact from the loss of charitable gambling revenue. While youth hockey associations in Andover, Centennial and Coon Rapids are seeing higher net receipts in fiscal year 2007 than fiscal year 2008, other youth hockey associations in Anoka and Blaine and Spring Lake Park as well as the Coon Rapids Mat Bandits Wrestling Club are seeing fewer charitable gambling dollars. Eric Hagen is at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it |
||
| < Prev | Next > |
|---|