SEMO study reveals casino's construction, payroll effect on economy

An Isle of Capri casino in Cape Girardeau would present an economic windfall of nearly $125 million for the area in three particular areas -- construction, employee payroll and visitor spending, according to an independent study released Wednesday by Southeast Missouri State University.

While a statewide independent economic impact study by the Department of Economic Development won't be completed by Tuesday's election, the university's Center for Economic and Business Research released its findings that look at the year-and-a-half casino construction period, annual employee spending and new money that would be dumped into the economy each year by out-of-town visitors.

"There's no question that when you add 450 jobs and there's a construction project of this size that there will be a positive impact on the economy," said Dr. Bruce Domazlicky, executive director of the center.

But the two-page study also notes that there would be some "negative offset," specifically by some casino patrons spending money at a casino that might have otherwise been spent at other Cape Girardeau businesses.

"You can't predict it, but there would be some off-setting," Domazlicky said. "Instead of people spending money on other things, they may spend it at the casino."

However, the report says, the construction of the casino and the payroll will add significantly to the region's economy and would not be "anywhere near a dollar for dollar trade-off."

If voters approve the casino measure Tuesday and if the Missouri Gaming Commission selects Cape Girardeau as the site for the state's 13th casino license, the effect will be felt across most business sectors, Domazlicky said. The total effect for the year-and-a-half construction period would be $112.27 million.

Domazlicky came to that figure by calculating the direct effect during that time, which would consist of the purchase of goods and services that occurs. Construction companies would have to hire employees and buy materials from area suppliers, which then use that money in the local economy.

"Given the current slowdown in residential construction, this would be a welcome boon to the construction industry in the region," the report says.

Domazlicky estimated the company's annual payroll, when the casino is running at full operation, to be about $13.14 million. Those employees would have an $8.9 million annual effect on the economy by casino workers paying for housing, groceries, services as well as in entertainment venues and restaurants, he said.

The casino would also generate about $3.6 million in tourism dollars from out-of-town casino visitors each year, the report says. That's a conservative estimate -- Domazlicky bases his estimates on 500,000 casino customers coming from outside the region, but Isle estimates that 600,000 will come from outside the Cape Girardeau-Jackson area. He also estimates conservatively that those visitors would spend only $20 during a visit and it likely could be much more, he said.

Domazlicky acknowledges he was asked by Mayor Harry Rediger to do the study but said he was not paid and that he wasn't acting as a "hired gun."

Trent Summers, the chairman of the Yes for Gaming campaign committee, said he wasn't aware of the study but added that the numbers show what he and others supporters have known already.

"It sounds like it's further evidence of statistical and analytical proof of what the impact would be," Summers said. "We believe a casino would be good for the economy here."

The study by the state Department of Economic Development analyzing the three casino sites vying for the 13th license is nearly completed, department spokesman John Fougere said, but he wasn't sure it would be finished in time for the election.

Voters have enough evidence about the economic benefits of a casino, Rediger said, citing a study commissioned by Isle of Capri and Ameristar.

"I think that study by the state is more important for the Missouri Gaming Commission to make its decision about who gets the last license," Rediger said. "The information we have provided the public is probably sufficient for voters to make up their minds on how they want to vote."

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