PENNSYLVANIA Lawmakers: Proposals to legalize slots could get a renewed effort
The House wants 11 venues for slots; the Senate wants eight.
HARRISBURG (AP) -- With bills that would raise income taxes and lower property taxes passed by the House and being considered in the Senate, a stalled effort to legalize slot machines may get going again in earnest, lawmakers say.
A bill to legalize and tax slot machines, which is a major piece of the funding puzzle in Gov. Ed Rendell's initiatives to increase education funding and lower property taxes, has been relegated to the back burner while lawmakers try to work through an impasse over education funding.
Senate and House Democratic leaders spoke earlier this month in an effort to resolve issues that divide two different bills passed separately by the chambers to legalize slot machines.
The main issue keeping Senate Republicans from supporting the House bill passed in July is the inclusion of 11 venues for slot machines, including off-track sites, as opposed to the eight sites at horse-racing tracks that the Senate approved in June.
"We'll have to come up with the right mix of racetrack and nontrack venues," House Democratic leader, H. William DeWeese said Wednesday.
Hoping for a compromise
Rendell said he would like to get House and Senate leaders together to work out a compromise bill, and DeWeese said that it would likely take Rendell's involvement to get that done.
DeWeese noted, however, that he would propose placing slots parlors at more off-track sites, instead of on-track sites, since few lawmakers who represent agricultural areas where horses are bred and raised have not supported the slots bills. Horse breeders stand to benefit considerably from the slots bills because purses at racetracks would be fattened.
The House passed a package of bills early Tuesday that, among other things, lays the groundwork to reduce property taxes. Rendell and House lawmakers say the House's bill on slot machines would raise about $1 billion to finance public education and help school districts lower property taxes.
Under the bill, districts that raise the local earned-income tax by at least 0.1 percent would receive slot-machine revenues to lower their property taxes by a corresponding combined amount.
A formula would distribute the slots revenue to local districts in multiples of the amount of their local tax increase, along with an additional adjustment that would direct more money to the poorest districts.
Looking at funds
If slot machines raise $1 billion in revenue, then each district should realize between 15 percent and 60 percent in property tax relief, DeWeese said. But the state would have to bring in at least $600 million in slots revenue for the money to be sent to districts, he said.
While House Democrats say that $600 million is the point at which the state can affect significant property-tax relief statewide -- about 10 percent to 40 percent, depending on the district -- Crompton said that having a "trigger" for the relief could present a problem.
For instance, the state could realize slot-machine revenues above $600 million in one year, and then miss that target the next year, which would mean no property-tax relief, he said.