Ohio Mulls How to Distribute Racino Payments

Ohio is studying how to divide up a $12 million fund created to mitigate the effects on racinos on local communities.

Ohio state officials are working out the details of how to distribute a million fund that was created to mitigate the effects on communities of allowing the state’s seven racetracks to add slot machines.

Lebanon, near Cincinnati, is the first such community to received racino payments from the fund that the 2011 law created when it legalized adding video lottery terminals at racetracks. It will get as much as $3 million, a onetime payment.

Three other Ohio towns are eligible for similar amounts, paid within six months of their racino opening, including Toledo, Grove City and North Randall.

Meanwhile, the Horseshoe Casino Cincinnati, which recently celebrated its first year in operation, has attracted 4.8 million visitors during that period. It has paid out nearly $53 million in payroll to its over 1,600 workers, while gamblers have won $50 million in jackpots.

The casino fulfilled and in fact exceeded its commitment to hire more than 90 percent of employers from the local area.

Despite those figures, critics of gaming point to disappointment revenues for the first full year of operations for the state’s four casinos. These revenues sharply differ from the profits predicted in 2009 when voters were asked to amend the state constitution to allow casinos. During that campaign revenues as high as $1.9 billion annually were predicted.

The four casinos are likely to produce $900 in revenues for the first year that all four have been open, according to statistic provided by the Ohio Casino Control Commission. That translates into $297 million in taxes for the state’s 88 counties, schools and each casino’s host city.

The Cincinnati casino was projected to reap $300 million during its first year, compared to the $200.7 it actually did make. Kevin Kline, the casino’s general manager, in an interview with the Toledo Blade, said, “The ramp-up has been a little slower than what some had anticipated. We’re a new business that continues to ramp up and continues to build, and we consider year two to be a building year and to we expect the results to get better.”

During the 2009 campaign, pro-casino forces claimed that the taxes generated would help alleviate the state’s budgetary issues. Opponents in that election criticized the 33 percent tax rate as too low compared to other states. Two percent of the revenue is earmarked for treatment of gambling problems and has led to six treatment centers in the state. As of last month 748 people had signed up for treatment, with numbers of those needing treatment on the rise.