BCT Editorial – 5/1/09

This page was last updated on May 3, 2009.

Spending priorities; Editorial; Beaver County Times; May 1, 2009.

The editorial subtitle is “Think about using poker-machine revenues for state’s infrastructure.”

Below is a detailed critique of the subject editorial.

“House Republicans are concerned that Gov. Ed. Rendell’s proposal to legalize video poker machines would create an expensive entitlement program.

“Although their concerns are valid, they should not turn their backs on the revenue these machines would bring in.

“Gov. Ed Rendell argues that legalizing video poker machines would generate about $1.1 billion a year. Half of the money would be used to defray college costs for students attending the 14 community colleges in the state and the commonwealth’s 14 state-owned universities (Slippery Rock, Clarion, Edinboro, etc.). The other half would be evenly divided between the tavern owners and the state’s general fund.”

[RWC] Wow, what a deal for the property owner! He gets to buy/lease the machine and pay for maintenance but gets to keep only 25% of the revenue, which of course will likely count as taxable income on the owner’s income tax forms.

“Rendell’s proposal would allow as many as five machines to be installed in up to 14,000 restaurants, bars and clubs that have liquor licenses.

“However, Rendell administration officials estimate that about 8,800 establishments would sign up for an average of four machines.

“Supporters are right to argue that legalizing video poker machines would not represent the expansion of gambling in Pennsylvania because they already are common sights in bars and clubs. By legalizing them, the state would be tapping into and profiting from an existing market.”

[RWC] Why does the state need to be in the gambling business at all? Just legalize it and treat it as any other business.

“While no one can question the high cost of attending college in Pennsylvania, Republicans should raise another concern — whether this is the best way to spend the revenue.”

[RWC] A better argument would have been to point out increasing the subsidy of the commonwealth-owned schools would only serve to drive up tuition further. That’s what always happens when you subsidize a good or service.

“Sure, families are struggling to send their children to college. However, Pennsylvania’s roads and bridges are falling apart. Its rapidly aging water and sewer systems are in dire need of attention. Its multitude of brownfield industrial sites must be reclaimed before they can be reused.”

[RWC] Aren’t “aging water and sewer systems” local responsibilities? Why should state taxpayers pay for local responsibilities?

“The state can’t tackle these problems on a scale that is needed because it doesn’t have the money. The state missed an opportunity when it dedicated revenue from legalized slot machines to minor property tax reductions instead of using it on infrastructure.

“Let’s not repeat that mistake with legalized video poker machines.”

[RWC] Keep in mind Times editorials constantly tell us we’re under taxed.