Ohio Sen. Bill Coley argued that the state’s gambling venues have failed to deliver on the initially promised tax revenue and due to this, they need to have their non-taxable gaming credits capped or even nullified.
Ohio’s gambling industry was legalized in 2009 after residents voted in favor of the establishment of four casinos and seven racinos on the territory of the state. Developers, in turn, promised that their facilities would annually generate at least $500 million in tax revenue. Furthermore, 34,000 new jobs were to be created for residents. It seems, however, that operators have failed to live up to those initial expectations.
Ohio’s tax revenue peaked in 2013 when the sum of $272 million was generated. In 2014, the eleven gambling venues contributed $267 million to the state.
Meanwhile, Sen. Coley pointed out that they have given away more than $500 million in non-taxable promotional gaming credits since July 2012. Generally speaking, the credits offer free slot machines and table game plays and are aimed at enticing new customers. According to Sen. Coley, those have cost Ohio more than $160 million in tax revenue.
The West Chester Republican said he is planning to propose a bill that would permit Ohio’s gambling venues offer their credits only if they manage to meet the initial tax revenue expectations. Furthermore, those credits will be imposed an annual cap of $5 million.
Tax revenue from the state’s eleven gambling facilities is distributed to counties and schools, in particular. If Sen. Coley’s bill is passed into law, more money will be generated for Ohio’s well-being.
The non-taxable gaming credits were introduced with a law signed by Gov. John Kasich in 2011. Moreover, the Governor and Ohio’s gambling operators signed an agreement, under which the latter were to pay the additional sum of $110 million over the next ten years.
Sen. Coley explained that his bill aims at overturning the above-mentioned law. If this happens, however, gaming operators Rock Ohio Caesars and Penn National could refuse to make their payments to those $110 million.
Eric Schippers, Senior Vice President of Penn National Gaming, explained that the non-taxable credits are among the things that make Ohio’s gambling market competitive. If the state regulator imposes a cap on those, this might lead to an increase in the number of players at Ohio’s casinos and racinos.
Mr. Schippers also pointed out that such a major legislation simply could not be based on estimates that were made several years ago under different circumstances.
