Casino foes say issue contains hidden tax

9/14/2009

COLUMBUS - The backers of four proposed Ohio casinos insist taxpayers will not foot the bill for road, traffic, and utility improvements if voters approve Issue 3 on Nov. 3.

Critics, however, charge that the issue contains a hidden tax, despite promises of job creation and new revenue for cities, counties, and school districts.

"There are no monies committed to the infrastructure, and the great question is who's going to be asked to pay for that," said Sen. Teresa Fedor (D., Toledo), one of the co-chairmen of Truth PAC, the committee established to convince voters that Issue 3 is a sucker's bet.

"There are no guarantees here," she said. "There are too many questions out there about the details of this constitutional amendment."

Middletown-based River Road Developments bought the site for the proposed Toledo casino in 2006 for $565,000 and has an agreement to sell it for an undisclosed sum to Raceway Park-owner Penn National Gaming if voters approve the ballot issue. The 44-acre site, formerly owned by Libbey-Owens-Ford and Pilkington North America, has an address of 1968 Miami St. on the south side of the Maumee River abutting Rossford.

The proposed constitutional amendment states that the casinos "shall make an initial investment of at least $250 million for the development of each casino facility."

But it is silent on any off-site improvements such as utility extensions, road upgrades, traffic controls, or lighting improvements that might be necessary to prepare for a large development that would include a casino, restaurants, bars, and parking lots.

"Any additional costs will be borne by us," said Penn National spokesman Eric Schippers.

Issue 3 will ask voters to approve a single casino each on specific sites in Toledo, Columbus, Cleveland, and Cincinnati.

Penn National plans to develop the Toledo and Columbus sites, while Dan Gilbert, majority owner of the Cleveland Cavaliers, would focus on Cleveland and Cincinnati.

River Road's president, Brad White, said he has brought water and sewer lines to the reclaimed former industrial site, which has been rezoned for multifamily residential and commercial use.

"The cleanup is done," Mr. White said. "The utilities are in. I was ready for parcels to be sold, but someone wanted to buy the whole parcel."

But there are limits to what Penn can do, thanks to restrictions enacted when the Ohio Environmental Protection Agency cleared the site for development last year after a taxpayer-financed environmental cleanup.

Waste sand ponds from glassmaking operations until the 1970s contaminated the soil and groundwater that was partly remedied with the cleanup.

The effort was aided by a $3 million grant from the Clean Ohio Fund and $1.1 million from the city.

Gov. Ted Strickland said he hopes the state would never have to question whether a casino was the development voters envisioned when they agreed to borrow money to fuel the Clean Ohio Fund in 2000.

"I have indicated that I am not supportive of the casino issue, and so I guess we'll cross that bridge when we come to it," Mr. Strickland said. "It is my hope that the initiative will not be approved by the people of Ohio, and we would not have to come to that decision."

The cleanup involved removal and replacement of about 2 feet of soil. The state cleared the site for development, but construction would essentially be limited to slabs at grade level, no basements.

"There is a covenant not to sue by Ohio where they've approved the cleanup of the site," said Joel Mazur, brownfield coordinator for the city of Toledo. "There was a lot of arsenic and heavy metals, so it was capped with cover soils. Everything is in place and is ready for resettlement, even for residential use … There are certain restrictions on the property. They can't dig into the cap."

Penn National has provided no architectural drawings, but Mr. Schippers said Penn envisions a gaming floor on one level.

"We met with members of the community, business leaders, and said we have different elements that we've used in developments across the country that we'd like to use here," he said. "It will be developed in concert with a partnership involving Toledo and Rossford.

"In Bangor, Maine, we incorporated many architectural elements into the facility so that it could serve as a gateway to downtown Bangor," he said. "This will serve as a gateway into Rossford. We want it to complement the local community and other business offerings."

No hotel is planned.

Mr. Schippers noted that Penn facilities in other states run shuttles between existing hotels and the casino.

Ms. Fedor suggested the fact that a portion of the Toledo site runs under an I-75 bridge could complicate development.

"Our highway system is right in the middle of the proposed site," she said. "If you think it's tough working with [the Ohio Department of Transportation], work with the U.S. [Department of] Transportation."

Mr. Schippers said the portion that might be affected by I-75 would not be critical to the development but might be used for overflow parking.

Contact Jim Provance at:

jprovance@theblade.com

or 614-221-0496.