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Why A Repealed Casino Law Wouldn’t Affect The Mass. Budget Much

The state budget approved by the Legislature on Monday relies on $73 million in gaming revenue. Here's a rendering of the proposed Mohegan Sun casino at Suffolk Downs in Revere.

The state budget approved by the Legislature on Monday relies on $73 million in gaming revenue. Here’s a rendering of the proposed Mohegan Sun casino at Suffolk Downs in Revere.

BOSTON — In recent days, there’s been some grumbling about a state budget that relies, in part, on gaming revenue that might disappear if voters repeal the casino law this November.

So we wanted to parse the numbers and offer an explanation.

On Monday, the last day of the fiscal year, state lawmakers agreed on a $36.5 billion budget. Out of that sum, $73 million is set to come from casino licensing and slot parlor revenue.

Before the vote Monday, Republican state Sen. Richard Ross cautioned his colleagues.

“I am concerned about the sustainability of this particular budget from the viewpoint that we do predicate it on certain anticipated revenue that we hope comes from something that could be the victim of a citizen petition,” he said. “I do worry that so much of our budget is relying on gambling revenues.”

Anti-casino activists also sent a warning about “phantom revenue,” given that voters could repeal the casino law through a ballot referendum.

But, in some ways, the issue isn’t about dollars and cents; it’s more about the politics of gaming.

On Monday, John Ribeiro, chairman of the group Repeal the Casino Deal, said in a statement: “You’d think legislative leaders would have more smarts than to balance the state budget on money they know full well might not exist in a few months.”

But budget experts say the budget routinely relies on anticipated revenue.

Andrew Bagley, director of research and public affairs at the Massachusetts Taxpayers Foundation, said the included gaming money is “minimal,” and will have virtually no impact on the budget.

The casino revenue — that $73 million — is only 0.2 percent of the total budget.

“It’s perfectly manageable should those revenues not be available,” Bagley said. “It’s not going to be a problem to balance the [2015 fiscal year budget].”

Noah Berger, president of the Massachusetts Budget and Policy Center, agrees. He said there are plenty of unpredictable risks in calculating a budget. The biggest one being tax revenue.

“You build the budget based on assumptions about economic growth and a number of other factors that affect tax revenue,” he said. “And, if the tax revenue numbers are off by 1 percent in either direction, that’s a significantly larger swing than the casino revenue money.”

Both Bagley and Berger agree $73 million in a $36.5 billion budget is tiny. And if voters repeal the casino law this November, they say the effect would depend on what’s happening in the overall economy at that moment. The state could dip into the rainy day fund to cover the gaps left from the $73 million shortfall. But, then again, revenue could be greater than expected, so maybe there will be no shortfall at all. It’s all a bit of a guessing game, and lawmakers regularly tweak the budget throughout the year depending on revenue growth.

What’s unique in this $73 million instance is that the voters, not the lawmakers, hold the purse strings.

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