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$100 million fee tied to Gary casino move raises eyebrows at Statehouse
2019 Indiana General Assembly

$100 million fee tied to Gary casino move raises eyebrows at Statehouse


INDIANAPOLIS — The Region lawmaker who has done the most to pave the way for the relocation of Gary's Majestic Star casinos, and to set the stage for the redevelopment of Buffington Harbor, opposes recent legislative action that puts those moves in doubt.

State Sen. Eddie Melton, D-Gary, said Thursday he disagrees with changes to Senate Bill 552 made Wednesday by the House Public Policy Committee, including requiring Spectacle Entertainment to pay a $100 million fee and forfeit its second gaming license for permission to take the Majestic Star from its Lake Michigan dock and put it at a land-based site adjacent to the Borman Expressway.

"I believe we can do better," he said. "I remain hopeful and look forward to working with House Republicans to identify amendments that are additive to all the diverse interests served by this truly transformative legislation."

On the other hand, state Rep. Carolyn Jackson, D-Hammond, said she understands why the committee wants Spectacle to pay $100 million to become the first Indiana casino to move from its original site, and to possibly open a second casino in Terre Haute.

"You have two licenses there, and if you move one away your profit is going to go up sky-high immediately," she said.

Jackson also isn't on board with Melton's proposal in Senate Bill 66 to turn Buffington Harbor into an intermodal shipping and warehousing center, following the Majestic Star move, because it will mean many more long trains blocking Hammond's streets.

"You would split up my town," Jackson said. "What's going to happen if there's an emergency?"

Jackson suggested that if Spectacle ultimately pays $100 million to move to the Borman, and Gary develops Buffington Harbor into an intermodal facility, the fee paid in connection with that move should be used to construct overpasses that eliminate road-rail intersections throughout Hammond.

Notably, both Jackson and Melton recognize that nothing is yet set in stone with the gaming legislation, which next week is likely to be evaluated for its state and local financial impact by the House Ways and Means Committee.

"In my short time here in the Legislature, I've quickly learned that a bill as impactful as this would invariably meet a multitude of opinions, perspectives and understandings as it matured through the process," Melton said.

Even House Speaker Brian Bosma, R-Indianapolis, who has served in the chamber since 1986, acknowledged that more changes are coming to the measure. But so far he's pleased with how it's been revised since passing the Senate, 38-11, on Feb. 26.

"There was a lot of concern about the provisions of the bill as it came over from the Senate, with a lot of payments back and forth, hold-harmless payments, that made a lot of people uncomfortable," Bosma said.

Bosma also contends that it's "very appropriate" for a fee to be attached to the Gary casino move, since the improved location near the Borman, and the possibility of a second casino in Terre Haute, increases the value of Spectacle's investment by upwards of $100 million.

"(A fee) is what we've done previously as well when there's been either a transfer or a big enlargement like the racinos," he said.

Senate President Rod Bray, R-Martinsville, is not yet all-in on the $100 million fee. Though he's also not surprised that the House is considering the charge.

"There is maybe some value that's being added there so maybe it justifies the fee. Whether it's $100 million, which is a big one, I don't know. But we'll take a look at it," Bray said.

"They're working on it, trying to find the best language for them. I understand that. I expected there would be changes."

At the same time, Senate Democratic Leader Tim Lanane, D-Anderson, said it smacks of "strong arm" tactics by the state to require Spectacle pay a huge fee and give up its second license to complete a move that will create jobs in Northwest Indiana and grow the state's gaming tax revenue.

"I look at it as economic development. That's exactly what I see is going on with this legislation. I think it's a way to help various communities. Certainly it would help Gary, Terre Haute," Lanane said.

"So I hope that whatever changes are made it doesn't interfere with the economic development opportunities that I see in that bill."


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