Slots parlor not hurting lottery sales

A STUDY COMMISSIONED by the Massachusetts Gaming Commission suggests the opening of the Plainridge Park Casino in Plainville in June 2015 did not cannibalize lottery sales in the surrounding area.

The study, by Mark Nichols, a professor of economics at the University of Nevada at Reno, examines only one year of operation at the state’s first and smallest casino facility. But it nevertheless eases concerns that casino gambling would put a dent in lottery sales and result in less local aid going to cities and towns across the state. Indeed, the study suggests local aid overall  may have increased last year because lottery sales remained fairly steady ($998 million in profits went to cities and towns) and a portion of state casino revenues (about $60 million) was directed to local aid.

“This is obviously some good news to start with,” said Michael Sweeney, executive director of the Massachusetts lottery. “We’re cautiously optimistic that this trend will continue.”

The lottery study comes on the heels of another report indicating crime did not increase significantly after Plainridge opened. The earlier report indicated crime overall was down in communities near Plainville following the opening of the casino, but said there were increases in collisions and reports of disabled and suspicious vehicles.

The Nichols study, which was released at a meeting of the Gaming Commission, found no widespread decrease in lottery revenues after the opening of the Plainridge slots parlor. At the facility itself, lottery sales soared by more than 25 percent, he said.

Nichols said lottery sales at individual vendors tend to be somewhat volatile but on average have been flat for the past several years. After the opening of the slots parlor in Plainville, Nichols said lottery sales remained stable statewide and in the area around the casino. Nichols based his analysis on store-by-store lottery sales data provided by the Massachusetts Lottery.

The rise in lottery sales at the casino itself was an interesting finding. Lottery products at Plainridge are sold at vending machines and at the gift shop. Many analysts had been skeptical that gamblers headed to a casino would have any interest in buying scratch tickets, which can be purchased at vendors across the state. But Nichols found that lottery sales at Plainridge rose dramatically once the facility opened, suggesting scratch tickets and slots are compatible.

Sweeney, the executive director of the Massachusetts Lottery, said he thinks the opening of full-scale casinos in Springfield and Everett may have a greater impact on his business. The Springfield and Everett facilities will feature table games and slots, while the Plainridge facility offers only slots. But Sweeney said the results at Plainridge suggest the impact may be far less than many feared.