INDIANAPOLIS | Casino tax revenue paid to Northwest Indiana communities would be cut under legislation amended and approved by the Senate Appropriations Committee on Thursday.
Senate Bill 528 was changed to require counties, cities and towns, instead of state government, to bear more of the costs of a proposal to reduce gaming taxes on Indiana casinos to spur property improvements and make the casinos more competitive with other states.
Under the amended legislation, local gaming taxes paid by Gary's Majestic Star casinos would drop by at least $5.1 million a year. East Chicago's Ameristar Casino would pay local governments at least $4 million less; Blue Chip Casino, in Michigan City, would pay $2.6 million less, and Hammond's Horseshoe Casino $400,000 less.
Nearly every unit of government in Lake, Porter and LaPorte counties shares in the distribution of those funds.
Most of the revenue drop would come from elimination of a state guarantee that the local share of casino admission tax revenue will never drop below the 2002 total. The legislation replaces the admission tax with a supplemental wagering tax.
State Sen. Luke Kenley, R-Noblesville, the committee chairman, said attendance at every casino except Horseshoe has declined since 2002, and last year the state paid $40 million from its general fund to make good on the guarantee.
Kenley said if the plan to make Indiana's casinos more competitive doesn't work, he doesn't want the state on the hook for unlimited future payments to local governments.
State Sen. Earline Rogers, D-Gary, said the state took in more than $600 million in gaming taxes last year and can more easily afford a reduction in its gaming revenue.
"I don't see why those dollars have to be taken from the individual communities where these boats are docked," Rogers said. "I think the state needs to be reminded that were it not for individual communities pushing for riverboat gaming, then we probably wouldn't have it."
An official estimate of the local revenue reductions is being compiled by the nonpartisan Legislative Services Agency.
Kenley noted the proposal is "a work in progress" and likely to change again as it continues to move through the General Assembly.
Next week all senators will have the opportunity to propose changes before voting on whether to send the measure to the House.
Besides reducing local government gaming tax revenue, the legislation makes numerous changes to Indiana's casino industry, including allowing riverboats to move onto land next to their current docks and permitting the central Indiana horse track casinos to use live dealers.
The state also would give casinos a 10 percent tax credit for up to $400 million in new construction costs, and casinos could exempt from wagering taxes up to $2 million in free play awarded to non-Indiana residents.
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