Hawaii Could Say Aloha to Kapolei Casino, But Odds Still Long

Posted on: December 16, 2020, 06:44h. 

Last updated on: December 17, 2020, 09:28h.

Todd Shriber @etfgodfather Read More
Expertise: Financial, Gaming Business, Mergers and Acquisitions.

The Department of Hawaiian Homelands (DHHL) is taking a bold approach to dealing with a cash crunch caused by the coronavirus pandemic: It’s proposing a casino in Kapolei on the island of Oahu.

Kapolei Casino
The Aulani Disney Resort in Kapolei, Hawaii. The Department of Hawaiian Homelands (DHHL) is pitching a casino in that city. (Image: Popsugar)

DHHL says it needs to raise $6 billion to adequately serve the more than 28,000 native Hawaiians that are waiting for housing on lands the agency is encountering difficulty in developing because it lacks the needed financial resources.

The department’s request is unusual because the Aloha State has long been against casinos and is currently one of eight that aren’t home to any commercial or tribal gaming venues. Kentucky is part of that group, but it has racetracks, while Virginia recently became the 26th state to permit commercial casinos. Hawaii and Utah are the only states in the country that have no forms of legalized gambling.

In the eyes of DHHL, trying times call for unique solutions.

Given the impact of COVID-19 on our state’s economy, the department is proposing a bold measure that has proven successful for indigenous groups in generating critically needed revenue to improve the lives of their people,” according to a statement released by the agency.

Kapolei makes for a sensible location for a gaming venue, as it’s the second-largest city on the “Big Island” behind the state capital of Honolulu.

Don’t Expect Rubber Stamp

Given Hawaii’s anti-gambling history — the state doesn’t even have a lottery — winning approval for a casino faces long odds.

The road DHHL faces starts with sending its pitch to the Hawaiian Homes Commission for a vote. Should the commission approve, the matter moves to Gov. David Ige (D). If Ige signs off, the issue goes to the legislature, both houses of which are controlled by Democrats. Hawaii’s House of Representatives has 51 seats, 46 of which occupied by Democrats. The state Senate has 25 members, a mere one of which is a Republican.

Assuming the proposal makes it as far as the legislature, it will almost certainly encounter opposition there. In an interview with KITV-4, the local ABC affiliate, Sen. Maile Shimabukuro said her constituents complain about drugs and crime stemming from illegal gambling rings, and are concerned that situation could worsen with a legal casino on the island.

DHHL’s proposal doesn’t say if the department’s preference is for a commercial or tribal venue, and prospective operators aren’t mentioned.

Las Vegas Impact

Should Hawaii become home to a legal gaming venue, the decision would have ripple effects on the mainland, namely in Las Vegas, as Sin City is affectionately dubbed the “ninth island” because of its popularity with Aloha State tourists.

Among mainland operators that would be pinched by a Hawaiian casino, Boyd Gaming is atop the list. Its downtown Las Vegas properties are popular with visitors from the island state, so much so that the company laid off nearly 300 workers in October, citing slack tourism from Hawaii, among other regions.