On Tuesday, November 5, voters in Colorado will decide whether to approve Proposition DD, which would legalize sports betting in the state.
In the Centennial State’s three casino towns—Black Hawk, Central City and Cripple Creek—support for the measure isn’t even close. It’s a total blowout in favor. Which is good because each of the casino cities must take its own vote on whether to allow sports betting within city limits. It could pass at the state level and theoretically be denied at the city level. However, given how much gaming is wound up in the fabric of each of these small cities’ economies, such a vote would be almost unthinkable.
Since Colorado legalized casino gaming, the owners of have tried different tactics for increasing the bottom line, including 24/7 gaming, the addition of table games and expanded alcohol sales. All with a limited degree of success.
House Minority Leader Patrick Neville, one of the major sponsors of the bill that put Prop. DD on the ballot, right now sees its chances of success on Tuesday as “50-50.”
In an exclusive GGB News interview, Neville said, “I think part of it is the way that we that we had to put it on the ballot. The language said, ‘There shall there be a new tax.’ Many people don’t know that sports betting is illegal. That’s new knowledge to them. There’s a lot of education that needs to be done and it is technically a new tax, but it’s on something that doesn’t exist right now.”
Because Colorado is a state where new taxes are viewed with extreme skepticism, there’s been a lot of “We don’t want a new tax. Why don’t you fund it with what you’ve got?” says Neville. “It’s a lower tax than what the casinos pay on their other activates. So it’s actually lower than if you put $20 on red. There is a graduate gaming tax that is always much higher—if not four times higher—than would be paid on sports betting.”
It has also been a job of educating people to the fact that it will be the casinos and not the bettors who will be taxed. “It’s not their winnings that are taxed,” said Neville. “It’s what’s left after that is taxed.”
As the minority leader, Neville had a lot of input on the referendum’s final language. “When it came to me the bill had a thirty percent tax—which we brought down—and no limitation on the amount that could be taxed, so I put a cap on $29 million.”
The state’s Taxpayer’s Bill of Rights mandates that any tax collected over that amount will be refunded to taxpayers. Neville helped steer the measure towards largely benefiting the Colorado Water Plan, “which 90 percent are in favor of.”
Another measure on Tuesday’s ballot has further complicated Neville’s ability to sell. That measure, Proposition CC, is attempting to get rid of the Taxpayers Bill of Rights as it applies to Prop. DD. “Politically it’s making it difficult; some are more invested in defeating CC than in passing DD.
Meanwhile, Neville is “working the radio circuit and working it hard. Many were opposed and later told me, ‘You explained it all,’ and now they are in favor,” he said. As a Conservative Republican, he also has to talk to strong social conservatives who don’t support gaming and compare it to taking drugs.
He has an answer for that: “You can’t log into your computer and shoot up heroin but you can log in and place a sports bet. I’d rather put some sunshine on it and bring it into the light. I’d rather put some sunshine and bring it into the light. Why not do it the legal way? Then everyone is happy.”
“Anything that expands gaming in the state, we support,” Black Hawk City Manager Steven Cole told GGB. “Anything that will give people more options, we’re going to be in favor of.” And no wonder. The three casino towns took in a record $842 million in 2018, 13 percent higher than in 2014.
Sure, the main beneficiary of Prop. DD would be the state’s water project, which will get the lion’s share of the 10 percent state tax on the activity. But the casino cities are hoping that it will enable them to expand the amenities they offer, and maybe give a draw that will attract someone who might otherwise end up in Las Vegas.
“There are no direct disbursements to the cities,” said Cole. “We are hoping there will be a lot more brick-and-mortar here. It gives people more options.”
The three cities are undergoing a building renaissance of sorts that they hope will be helped along by the ability to offers sportsbooks. Cole noted that the Monarch Casino’s expansion in Black Hawk will open in a few months with 500 additional rooms and a larger gaming floor. He added, “We’re also doing some things as a city, including redeveloping our gaming street.”
Added amenities are designed to appeal to non-gamers. “We
are also building a new trailhead to give people more options to do different things. We are supporting all of the gaming operations to add diversity to what visitors would like to see,” said Cole.
He’s confident the ballot measure will pass in Black Hawk. The city has 15 casinos. The Ameristar is the largest with 526 rooms and the Monarch is of comparable size. The Monarch is adding a 519-room hotel, spa and casino expansion.
Triple Crown Casinos plans to begin work by the end of 2019 on a $40 million, 150-room hotel slated for a 2021 opening.
“Our city is about a mile and a half in area,” Cole told GGB. “We are an old mining town that incorporated in 1864.” The town has about 61 homes and 118 residents, “and 20,000 visitors a day depending on the day. We are very gaming-centric. Everything we do focuses on gaming.”
Central City Manager Daniel Miera told GGB, “From what we’ve learned, it does appear as though there’s wide support (for Prop. DD), and our local ballot has a similar question. So if it’s approved at the state level, our voters will also pass it as well.”
Although his city will get no direct benefits from sports-betting taxes, “We may see some local fees as well as direct and indirect benefits from gaming. To the extent that any sports betting increases the volume of the players that come up we will see a share of that increase,” Miera said.
It’s too soon to know how many of Central City’s casinos will choose to participate, he added. “We’d think that, having the option, they would take advantage of it. And as far as revenues for the state water plan I think Central City will benefit directly and indirectly from implementation of the plan.”
Mark Campbell, city administrator of Cripple Creek, also spoke to GGB. “It’s interesting to note, we’ve lost our share of the gaming market to Las Vegas because of sports betting. We’re not too far away from Colorado Springs. I think if we are able keep some clients in the Colorado area it will be a little better for everybody.”
Cripple Creek has three casino hotel projects in the pipeline, Campbell said. “One has started and one is about to and one will start in the spring of next year. There may be more. There is talk of number four and number five.”
A project currently underway is the $14 million, 102-room hotel slated for opening a year from now, which will be connected to the Wildwood Casino by a heated walkway. Full House Resorts plans to upgrade its Bronco Billy’s Casino with a $120 million project that will include a 150-room hotel, a restaurant, convention and event space, parking garage and outdoor courtyard.
The city’s economy is tied up with gaming and tourism, Campbell said. “A large part of the tourism is based on historical and is based on one of the largest gold mines in the world (which is still operating). We’ve got a lot of history. When they brought gaming into Colorado a large portion was to help a number of mining cities that were on harder times. Between Cripple Creek and Central City, we’ve preserved the historical aspect the best.”
An example of the history that gaming money has helped preserve is the old gold Stock Exchange, which is now an Elks Club. The city has 12 casino licenses, “but about six real casinos. The mom-and-pops were bought out by the larger entities,” he said.