Indiana Racinos

The article below is no longer archived on the link, but serves as yet another example of the folly of Predatory Gambling and Baling Out Tracks, a familiar refrain among Massachusetts lawmakers.

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Tracks are gasping their last breath, so let's bale them out?

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Do you hear lawmakers offering such irrevocable privileges for any other single industry?

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[emphasis mine]

Indiana panel approves tax breaks for 3 casinos
By MIKE SMITH
updated 12:16 p.m. ET, Tues., Feb. 17, 2009


INDIANAPOLIS - A House committee approved a bill to give temporary tax breaks to three Indiana casinos, including new ones at the state's two pari-mutuel horse tracks.


The House Ways and Means Committee voted 17-7 Monday night for a bill to give tax breaks on wagering revenue for Blue Chip Casino on Lake Michigan, and casinos at Hoosier Park in Anderson and Indiana Live at Shelbyville. The bill now goes to the full House for consideration.


Advocates said the casinos are struggling and need help to stay in business. Critics said many other businesses in the state are facing hard times in the sagging economy, and it was not fair to single out the casinos for special favor.


The General Assembly passed legislation in 2007 allowing Hoosier Park and Indiana Live — then called Indiana Downs — 2,000 slot machines each at their pari-mutuel venues.


Track officials said revenue from the slots was needed to keep their tracks and the horse racing in Indiana viable, and they agreed to pay $250 million each over two years to get the slots, as well as spend at least $100 million each to build the new casinos. The state imposed a graduated tax on revenue from slots at the so-called "racinos," which opened last summer.


Under the bill, tax rates on the slot revenue at the tracks would be cut 5 percentage points for each of the next five years, reducing their combined annual tax liability by about $18 million per year.


John Keeler, a lobbyist for Hoosier Park, said its parent company, Centaur LLC, was under severe financial distress and was paying high interest for loans it obtained to pay the slot licensing fees. He also said

the track and the state had misjudged revenue projections from the slots.

"Quite frankly, the tracks blew it and so did the state," he said.


The bill also would provide a $15 million tax deduction to Blue Chip for one year, to be phased down and out over five years. The deduction is projected to cost the state about $5 million in lost tax revenue the first year and less in subsequent years, said Democratic Rep. Scott Pelath of Michigan City, the bill's author.


Blue Chip's business has taken a hit since the opening of the Four Winds casino in Michigan, which opened in August 2007 about 10 miles from Blue Chip and is owned by the Pokagon Band of Potawatomi Indians. Blue Chip saw its monthly revenue fall from $26.7 million in July 2007 to $16.1 million a year later — a decline of nearly 40 percent.


Ryan Soultz, a lobbyist representing Blue Chip, said the tax deductions would allow the casino to enhance its marketing efforts and draw more customers.


Several lawmakers who voted for the bill said they did so with reservations, but said casino revenue was important to the state — especially during this recession — and they wanted to keep the bill alive in some form.


Rep. Randy Borror, R-Fort Wayne, said the bill sent a wrong message to other businesses that were struggling. He was among the seven who voted against the bill.


Copyright 2009 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

http://www.msnbc.msn.com/id/29238848/