Report: Ohio casino revenues won’t fill budget holes
The Newark Advocate - October 8, 2012
The opening of the new Hollywood Casino in Columbus on Monday not only will mean another regional entertainment option, but also much-needed tax revenues for cash-strapped governments.
But when all four Ohio casinos are in operation, the taxes generated won’t come close to plugging the holes created through state financial cuts, according to a report released this week from Policy Matters Ohio.
The Cleveland-based liberal research organization reported local governments will receive $227 million in casino-based revenue annually once all four are operating, which is expected to happen in 2013 after the Cincinnati casino opens.
Those revenues, however, don’t come close to replacing the nearly $1 billion in state revenues cut from the state’s 2010-11 budget compared to its previous one.
“Casino revenue is nowhere near sufficient to restore cutbacks in the state budget and answer Ohio’s needs,” said Zach Schiller, research director of Policy Matters Ohio and author of the report.
Schiller also thinks his group’s revenue projections were optimistic despite being smaller than those released this summer by the County Commissioners Association of Ohio.
That report estimated the casinos would generate $460.2 million in tax revenues compared to just less than the $400 million estimated in the Policy Matters Ohio report.
The state constitution requires the state receive a tax equal to 33 percent of gross casino revenues. Slightly more than half of that money is split among the state’s counties based on population.
The money goes only to the county government and typically is not split among other local units. Cities of more than 80,000 people, however, split those proceeds with their county.
About a third of the total revenue goes to public school districts with the remainder split among the Ohio State Racing Commission, the Casino Control Commission, the treatment of problem gambling, law enforcement training and the casino host cities.
Licking County is projected to receive $3 million annually from the casinos, according to the Policy Matters report. The summer report predicted $3.4 million annually for the county.
The fact is the state and counties don’t know what revenue they will get from the casino, said John Leutz, senior policy analyst with the County Commissioners’ Association of Ohio.
He said the association can’t give a concrete number for counties to use for budgeting, so it would be wise to be conservative with the estimates.
“We’re not counting eggs or chickens at all yet,” he said.
Leutz said the association also was concerned with state revenue cuts, especially as responsibilities for county governments have increased.