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Ohio House meets next week with $500K racino payment amendment in front of them
Letter from State Representative Ronald V. Gerberry
Document
State Representative Ronald V. Gerberry's letter to Chairman Robert Schmitz | requesting an update on the status of Section 605.33 of Am. Sub. H.B.59. This section relates to the drafting of an agreement with the Governor, in consultation with the State Racing Commission and interested parties, to establish an ongoing $500,000 annual payment to host communities of Ohio Racinos.
By ROBERT CONNELLY
AUSTINTOWN
Penn National Gaming Inc. is critical of the state Legislature, after the Ohio Senate passed an amendment requiring the gaming operator to pay half of the $500,000 owed to Austintown and Dayton for three years.
The other half — or $250,000 — would come from the casino Operator Settlement Fund (track relocation fund) – into which Penn National is paying $150 million over the next 10 years for the new tracks in Dayton and Austintown: Hollywood Gaming at Mahoning Valley Race Course and Hollywood Gaming at Dayton Raceway.
The amendment spelling out these specifics passed the Ohio Senate 31-0 Wednesday.
The $500,000 annual payments are supposed to be paid by Dec. 31 and are to be used 50-50 for infrastructure and capital improvements and general-fund use. That is the same set up as the two $1 million payments Austintown already received, which went toward resurfacing roads and paying off a communications system debt.
The Ohio House of Representatives will take up the amendment next week.
“We are extremely disappointed by the special new tax the Ohio Senate has voted to impose on our company alone, despite our having paid an unprecedented $150 million in fees for the ability to relocate our racetracks to areas in need of new economic development and jobs,” said Eric Schippers, senior vice president of public affairs for Penn National, in a statement Thursday.
“Our company has invested nearly $1 billion in four gaming facilities in Ohio, created thousands of new jobs, and paid more than $320 million in new local and state tax revenues, and continues to support numerous local charities and civic organizations in the communities in which we operate.”
Schippers added: “We’re baffled by the Senate’s action, and we are beyond dismayed at having been singled out yet again for another money grab.”
Senate Minority Leader Joe Schiavoni of Boardman, D-33rd; and Sen. Bill Beagle of Tipp City, R-5th, had worked together on getting an amendment onto an existing bill that had already passed the House. That vehicle – HB 494 – deals with local government issues. The amendment, introduced by Beagle on Wednesday, specified that $250,000 would be paid by the track operator – Penn National in both cases – and $250,000 from the track relocation fund, which Penn National pays into already for the relocation fees associated with Austintown and Dayton.
Dayton’s track came from Toledo and Austintown’s came from Grove City.
State Rep. Ronald V. Gerberry of Austintown, D-59th, said he will pursue extending the payment past the decided-upon three-year mark. Both Schiavoni and Beagle have said they will pursue the matter in the Senate.
“That’s wonderful, but that wasn’t the agreement. The agreement was on a permanent basis,” Gerberry said of the three-year restriction.
In fact, Gerberry was on the committee that came up with the $500,000 payment included in the state’s 2012 bill on racinos.
“I do have an interest in going back and securing a longer stream of payments,” Beagle also said Thursday. “I think [this amendment] will pave the way for [Austintown] township and city [of Dayton] to get their payments in a timely manner.”
Dayton Mayor Nan Whaley was unavailable for comment Thursday.
Robert Schmitz, Ohio Racing Commission chairman, said the matter was a legislative one and had no comment. The office of Republican Gov. John Kasich also had no comment.
Austintown Trustee Ken Carano has been involved in the payment talks since he took office in January.
“The response we’re getting is fairly positive,” he said. “The thing that shocks me is that the memorandum of understanding specified for all six racinos” now in Ohio, except for Scioto Downs in Columbus.
The reason why Beagle and Schiavoni had to scramble for an amendment is because the “good faith negotiations” specified in the original memorandum of understanding did not take place until just weeks ago.
“There is no question about it,” Carano said of the mid-term elections playing a role in the meetings not being held earlier. “When you have an election year, everything pretty much stands still, from the governor down ... The whole situation is that your are putting your concentration toward re-election.”
He added: “There were so many things involved in this, and we were going through such great thrills with the opening [of Hollywood Gaming] that we didn’t think about the memorandum of understanding.”
Carano is considering going to Columbus next week for the House vote, which could come before Thursday.
Gerberry also talked about the lack of talks before the amendment flurry. He said nine members of the House signed a letter earlier this year requesting a meeting on the payments directed to Schmitz at the racing commission. That letter is dated March 25, 2014 and he provided a copy to The Vindicator.
It was written by Gerberry and requested an update, and specified the payments to the host communities – not just Austintown and Dayton. “Your assistance in expediting this process would be greatly appreciated by all of us representing the affected communities,” Gerberry wrote to Schmitz.
The letter was later signed by Gerberry and Reps. Peter Beck of Mason, R-54th, Peter Stautberg of Anderson, R-27th; Robert F. Hagan of Youngstown, D-58th; Marlene Anielski of Walton Hills, R-8th; Roland Winburn of Dayton, D-43rd; Kristina Roegner of Hudson, R-37th; Fred Strahorn of Dayton, D-39th and Jim Butler of Oakwood, R-41st.
“It wasn’t us that dropped the ball on this. It was that the administration did not push the racing commission to get this completed and then all of a sudden three weeks ago we have a meeting and we’re up against the wall,” Gerberry said.
If the House concurs on the Senate amendment, it goes to Kasich for approval. But if the House doesn’t concur, it would go into a conference committee. That would require Senate action, but the Senate’s last day of this session was Thursday.
“If we break, we can’t come back and vote on a conference report,” Beagle said. “I’m hopeful that the House [bill] will be concurred.”
Asked if there was worry about Kasich not signing the bill if it goes before him – the governor’s office has said that the payment should be the responsibility of the track – Beagle said: “There’s always a worry that he’ll veto the bill. That’s why we landed on a three-year deal.”
“I don’t think that this is a great deal for anyone, let alone everyone,” Beagle said.