LA Treasury Could Lose Money From New Orleans Smoking Ban

BATON ROUGE (AP) — State lawmakers Friday delayed approval of a $3.6 million casino support services contract for New Orleans amid concerns the city's new smoking ban will hit the state treasury.

         The prohibition against smoking in bars and gambling halls takes effect in late April, after winning approval from the city council and Mayor Mitch Landrieu.

         The gambling industry, which sought to stop the ban, said it will hurt business. Louisiana collects fees from the Harrah's casino, a horse racing track and video-poker halls in New Orleans. If revenue at the gambling locations falls, the state also will collect less.

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         "There's going to be a fall-off in attendance at the casinos … There's going to be less money available to the state of Louisiana," Ronnie Jones, chairman of the Louisiana Gaming Control Board, told the Joint Legislative Committee on the Budget.

         The Louisiana State Police, which oversees gambling enforcement, estimates the state could lose $17.4 million over two years in gambling revenue — a 20 percent drop in collections — because of the smoking ban.

         "That's a big hit," said Rep. Roy Burrell, D-Shreveport.

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         Lawmakers questioned the data, saying some of the gamblers might move to casinos in neighboring parishes, which could lessen the cost to the state treasury of the smoking ban. Rep. Walt Leger, D-New Orleans, said the state police data was extrapolated from studies in other states, not an economic analysis of Louisiana's gambling environment.

         "There are certainly other casinos where people can go if they want to smoke at them," Leger said.

         Awaiting further economic analysis, lawmakers held up a vote on the state's annual $3.6 million contract with the city of New Orleans to pay the costs of police, fire and sanitation services at Harrah's casino for the fiscal year that begins July 1.

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         Committee members asked legislative economist Greg Albrecht to study the possible state revenue losses and their impact on the state.

         Albrecht said he expects some loss to the state, but he wouldn't estimate as high as 20 percent. He said he'll provide scenarios of what the revenue dip could look like before the April budget committee hearing, when lawmakers will revisit the casino support services contract.

         – by AP Reporter Melinda Deslatte



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