Michigan’s Governor Rejects Expansion of Casino Gambling

In a blow to redevelopment efforts in this troubled city, Gov. John Engler said Tuesday that he would not approve off-reservation Native American casinos in Michigan.

The decision is a disappointment to casino developers, who had proposed six casinos for downtown Detroit, and to Mayor Dennis Archer, who had pinned the city’s economic development hopes in part on gaming.

Engler, a Republican who draws much of his support from upstate conservative and religious groups, said the negatives of casinos far outweighed the benefits such enterprises could bring.

“Detroit will not be the Las Vegas of the Midwest,” he said in a press conference in Lansing.

Engler’s decision came despite a recent endorsement of casino gambling by a gaming study commission he appointed. But Engler said the economic benefits of gaming are often overstated and that casinos spawn a whole range of social ills, such as more crime and drug use.

In Detroit, Archer said the decision is a major setback for the city. He said casinos are needed to raise additional revenue that would allow the city to lower its tax rate and attract new businesses.

“This is not a death knell for the City of Detroit,” Archer said at a press conference. “But it’s now going to take us more time.”

Casino gambling has a firm footing in Michigan. There are already 11 casinos operating on Native American reservations, mostly in the state’s upper peninsula and the northwest corner of the lower peninsula.

The push for casinos in Detroit gained greater urgency last year when a casino opened across the Detroit River in Windsor, Canada. It is estimated that U.S. citizens, mostly from southeastern Michigan, wager about $1 million a day in the Canadian casino.

The mayor expected Detroit to collect a 9% tax on gaming revenues, funds that he said could shore up the city’s shaky finances. He promised to lower both personal and business taxes with the new revenue.

Others saw casinos as a way to spur other new development in the downtown area, including a new stadium for the Tigers baseball team.