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Proposed Senate bill would cut boat revenue

For the past several years, Harrison County politicians have expressed budget concerns if the riverboat in Bridgeport failed to bring in the revenue it has each year since its inception (first as Caesars and now Horseshoe Southern Indiana) in 1998.
The theory councilmen and commissioners cite is that Kentucky will allow gaming at race tracks and Churchill Downs in Louisville will take advantage, thus causing the number of visitors to Horseshoe Southern Indiana to plummet.
That, however, doesn’t appear to be the most imminent threat to Harrison County’s riverboat gaming revenue at the moment.
It lies within the Indiana General Assembly.
A bill was recently introduced (and passed in the appropriations committee) in the Senate that would significantly reduce the amount of money Harrison County would receive from Horseshoe Southern Indiana revenue sharing, as well as all other riverboat counties’ revenue sharing from their respective casinos.
If the bill were to become law, Harrison County would lose an estimated $3.3 million in 2015 and $8.2 million in 2016. The county would still receive $18.5 million in taxes and other payments.
So far, the county has received $23.2 million in revenue sharing from the riverboat each year.
The bill, supported by Luke Kenley, R-Noblesville, chair of the budget-writing Senate Appropriations Committee, appears to be a long shot to become law because if every politician from riverboat counties voted against it, it would not pass. Plus, there’s a number of voting members who are against gambling in general and will not vote for it because it also includes measures that will make it easier for gaming facilities to succeed.
Although the Senate Appropriations Committee approved the legislation, it still has to be passed by the entire Senate body before it can move forward to the House of Representatives and the governor.
Indiana Rep. Rhonda Rhoads, R-Corydon, has been in contact with the Harrison County Council and Board of Commissioners about the bill and is not in favor of it.
The issue will be discussed at upcoming council and commissioner meetings.
Phil Smith, vice chair of the county council, said if such a bill were to pass, the council would have to re-prioritize its riverboat spending. The council has a financial committee in place to do just that, Smith said. He said the county is in a good place, because of the Harrison County Community Foundation, even if the revenue is lost.
‘We’d be able to continue running the essentials of county government,’ he said.
The major provisions of the bill would let racinos have gambling table games rather than just slot machines and allow riverboats to become land-based casinos as long as they are built on their existing property. It also allows for tax credits for investing in casino improvements in Indiana.
Darrell Voelker, director of the Harrison County Economic Development Corp., said he does think it is time for state and local government to work with casinos to expand and to be more successful; however, he doesn’t like the bill overall, even though he supports the initial intent to give casinos a small break and added incentives.
Senate Bill 528 would reverse a policy the General Assembly approved in 2003 that capped the revenues that local communities collect from wagering and admissions taxes but also guaranteed they’d never receive less than the amounts they collected in 2002.
That promise was made when riverboat tax revenue was at one of its highest levels and lawmakers believed it would continue to grow. But economic struggles and competition from neighboring states have weakened the revenue stream, and the state consistently pays out some of its gambling taxes to local governments to make good on the guarantees.
Voelker said the plan to fund the state reduction of tax revenues is perhaps most unfair to Harrison County.
When the state capped the revenue in 2002, Caesars Indiana was just getting going with the hotel and retail areas of the complex recently opening. The capped amount was not nearly what Caesars/Horseshoe eventually started generating, Voelker said.
‘This means that the state has been collecting a nice share of revenue generated in Harrison County for the past 10 years that was intended for local government in the original 1993 state gaming laws,’ he said.
Riverboat gaming revenue provides funding for the county council to budget many items that would normally be in the county general budget in the riverboat budget. This helps ensure the improvement of county services without raising taxes.
The revenue is also used for all kinds of community organizations within the county and provides funding for the Harrison County Community Foundation.
Voelker said economic development efforts in the county have been assisted enormously with gaming revenue.
‘Whether it’s $3 million or $8 million (less), it’s going to make a negative impact on Harrison County,’ he said.