The Gambling Industry crafted a referendum that Ohio voters passed [after numerous attempts] filled with overstated jobs and inflated revenue projections. Now the truth!
Just as in Massachusetts where Spectrum did the same!
Ohio casino tax-revenue projections on decline
Jun. 1, 2012
Written by Alexander Coolidge
Ohio’s new casinos are starting to open as revised projections show a 40 to 50 percent drop in gambling tax revenues – potentially affecting cities, counties and public schools across the state.The Enquirer compared latest tax projections by casino developers with projections they supplied in 2009, when voters approved full-fledged casinos in Cincinnati, Cleveland, Columbus and Toledo.
Tax revenues have been revised down for three of the four casinos. The latest revision was made this week: A 36 percent drop in projected revenues at just-opened Hollywood Casino Toledo, where crowds now are placing bets at 2,000 slot machines, 20 poker tables and 60 other games from roulette to black jack.
The revised figures suggest – at least initially – a smaller tax windfall than originally expected for Ohio’s 88 counties, 600 school districts and four casino cities. All are entitled to a percentage of tax dollars generated by gambling revenue – projected as high as $650 million a year in 2009.
Casino officials say their projections have changed as Ohio’s gambling market has become more crowded and competitive. In 2009, only the four casinos were allowed to offer expanded gambling beyond the state lottery.
Construction continues on the Horseshoe Casino Cincinnati. In the background is The Hamilton County Justice Center. / The Enquirer/ Liz Dufour
Now, in 2012, the possibility also exists for play at up to 2,500 slot machines at each of the state’s seven racetracks. The tracks are expected to poach players from the casinos.
Just this week, a judge dismissed a lawsuit challenging slots at the tracks, paving the way for “racinos” to do an estimated $1.3 billion in business each year. The first racino, at Scioto Downs harness-racetrack outside Columbus, opened Friday.
“The gaming landscape in Ohio has changed significantly,” said Bob Tenenbaum, a spokesman for Penn National Gaming Inc. It’s the developer of Hollywood Casinos in Toledo and Columbus. The Columbus casino is set to open sometime this fall.
Officials with Rock Gaming, developers of Horseshoe Casinos in Cleveland and Cincinnati, declined to comment, saying their lower projections were listed on company fact sheets last year.
The Cleveland casino opened May 14; Cincinnati’s is expected to open next spring at Broadway Commons, Downtown.
Under terms of the 2009 vote, casino operators are obligated to pay state taxes equal to 33 percent of gambling revenue taken in. Besides the shares to cities, counties and schools, tax dollars also are to be distributed to the Ohio Casino Control Commission, the Ohio State Racing Commission and state programs to train law enforcement and combat gambling addiction.
Ohio taxpayers also will benefit from new racino money – projected at $435 million once all seven racetracks are up and running with slots. That’s based on Ohio receiving a 33.5 percent cut of racino gambling revenue.
Sprinkle some Fairy Dust!
The difference is that racino money will go to the Ohio Lottery Commission and not be funneled directly to counties and local school districts. The Ohio Lottery Commission puts profits in a fund administered by the Ohio Department of Education.
Tax revenues and gambling receipts have yet to be reported by any state entity or the casinos. Some local and school officials are still using state projections generated in 2009 to forecast their potential cut from casino tax revenues.
“That’s the best available tax information out there,” said John Leutz, senior policy analyst with the County Commissioners Association of Ohio, referring to an October 2009 report generated by state officials to estimate tax revenues for schools and governments. That report cited the casino developers’ studies and other research.
Leutz said the association has advised members to wait for more concrete information before making plans to spend casino tax revenues.
Whether racinos would figure into Ohio’s gambling picture has been a guessing game of the industry and policymakers for at least three years.
What business would make a significant investment without honest projections? NONE!
In 2009, then-Gov. Ted Strickland signed a budget into law that included a provision to authorize video slots at racetracks. Strickland’s push was immediately challenged and delayed by litigation. A group won the right to put Strickland’s racino issue on the November ballot in 2010, but that ballot was abandoned before it came to a vote.
The racino issue languished until Gov. John Kasich unveiled his plan to install the slots in mid-2011. The Lottery Commission granted the first racino license last month to Scioto Downs.
Other racetracks held off as a lawsuit brought by conservative anti-gambling group the Ohio Roundtable made its way through the courts. A judge dismissed the case this week, clearing the way for racinos to proceed.
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