Wednesday, October 28, 2009
COLUMBUS (AP) — A ballot proposal to build casinos in four Ohio cities seems to be clear: a ’yes’ vote would bring in millions of dollars in additional money to run local governments and schools.
But a revenue-hungry state government in Columbus may have different plans, should casinos in Cleveland, Columbus, Cincinnati and Toledo be approved on Nov. 3.
While Issue 3 backers say the casinos would be worth an additional $585 million a year to counties, cities and schools, ambiguous language in the amendment would permit the state to take money out of a fund set aside for local governments, potentially leaving them no better off than they are now, state lawmakers said.
“It’s either poorly written, ambiguously written, or too-clever-by-half written,” said state Sen. Bill Seitz, a Cincinnati Republican who’s been pushing the state to draft its own gambling plan. “In any case, all of these questions continue to swirl because of the lack of clarity on this point.”
But the Ohio Jobs and Growth Committee, which is pushing the casino plan, said the language is clear.
“The amendment clearly states that the funds generated by the new casino gross revenue tax must be used to supplement current state programs,” said spokesman Bob Tenenbaum.
Several lawmakers said the option of taking money out of the local government fund shouldn’t be taken off the table with the state facing an $850 million hole, and a much bigger hole in the next two-year budget.
To others, taking money out of the fund — which distributed $758 million to local governments in 2008 — would go against the demonstrated will of voters.
The casino amendment says that tax distributions to public school districts and local governments are “intended to supplement, not supplant, any funding obligations of the state.” It also says the casino revenue for local governments cannot be used to determine whether the state is following its funding “obligations” as determined by the Constitution.
Seitz, an attorney, said the use of “intended” weakens the language and that “funding obligations” is oblique. There is no constitutional requirement for the state to fund local government, he said.
Gov. Ted Strickland, a Democrat, agrees that the wording is ambiguous.
“This is not something the governor has considered or is inclined to do, but it does raise even more questions about this poorly drafted constitutional amendment,” said Strickland spokeswoman Amanda Wurst.
State Sen. Tom Niehaus, a Republican, said looking at the government fund shouldn’t be ruled out.
“Given the unprecedented nature of this difficult economic environment, I would think that we would not want to rule out any options at this point and be as flexible as possible,” Niehaus said.
It’s unclear, if the casino plan passes, whether the state could look toward casino revenue to help plug a current budget deficit of $850 million.
Under the plan, each casino would pay the state a $50 million license fee, but it’s unclear when those fees would be paid. The money is designated for regional job training, so lawmakers aren’t yet sure whether it can be taken for state purposes.
It may be easier once the casinos are running, and 90 percent of an estimated $650 million in annual tax revenue begins flowing to local governments. State lawmakers may be tempted when crafting a budget plan in 2011 to look at the local government fund, which they may consider no longer as vital for local governments.
State Sen. John Carey, the Republican Finance committee chairman, is reluctant.
“If it should pass, I think voters were willing to vote for it on the premise that they were voting for more money for their communities,” Carey said.
John Mahoney, deputy director of the Ohio Municipal League, said lawmakers have recently shown respect for the budget constraints of local governments.
“I think there’s good support of our cities and other local governments,” Mahoney said. “Hopefully it will continue to be there.”