Casinos In Ohio Not Meeting Expectations As State Budget Suffers

Published on December 9, 2013 by Terry Goodwin

It took lawmakers several attempts to convince Ohio residents that casinos can be beneficial to the state budget. The legislators and lobbyists ran with the concept not just the tax revenue, but in addition the industrial impact of getting casinos in a town would far outweigh the negative possibilities.

After years of trying, residents finally embraced the idea, authorizing four casinos back in 2008. The cities of Toledo, Columbus, Cleveland, and Cincinnati received the rights to host the casinos, and last year the gaming facilities were off and running. Within the year for the reason that casinos opened, revenue has fallen in need of expectations.

The 2013 budget proposed by Governor John Kasich included $958 million in tax revenue from casino gaming. The real figure came out to $868 million, falling nearly $100 million in need of expectations. That has ended in some questions in Ohio as casino operators seek for answers, and lawmakers spoke to the unpredictability of projections.

"Estimates of casino revenue are very difficult to foretell while you have no prior performance to head off," said Fred Church, Deputy Director of the Office of Budget and Management.

Year two may be equally hard for lawmakers to predict, because the first year is usually the next grossing revenue producer than years yet to come. The joy of the brand new casinos have worn off, and now the gaming facilities must depend on their loyal customers to drive revenue. Analysts predict that it takes three years before accurate predictions of casino revenue will also be made.

The developers of the four casinos, Penn National Gaming and Rock Gaming, pay the state a 33% tax on slot revenue. That may be probably the most highest percentages within the US, and indicates the small margins that the operators are engaged on.

While the 2013 revenue projections were off, officials in all four cities, and the state, are preparing for less revenue in 2014. Budget adjustments are being made upwards of $1 million in each city, and an adjustment of around $10 million is predicted within the state budget for next year.

Read More... [Source: Casino Gambling News]