Toledo budget forecast hurt by casino opening delay

The Hollywood Casino hasn't opened yet, but already the City of Toledo is betting on the gaming venue to help balance its budget this year.

Now, with an expected two-month delay in the casino's opening, city officials said Thursday that they're bracing for an estimated $1.1 million shortfall in tax revenue.

Mayor Mike Bell's 2012 budget proposal had anticipated a $4.5 million tax boost from the casino if it opened in April, finance director Patrick McLean said. But with the opening held up by the Ohio Casino Control Commission, the city is having to readjust its already tight budget figures.

Mr. McLean said the administration has not yet come up with a solution for the potential financial hole. He said he hopes to have an answer by next week when the city presents an amended 2012 budget to council. "If it's not open, it's not open. We used the best information we had at the time when we created the budget," the director said. "As circumstances change, we simply have to adapt."

Other financial news Thursday offered a more positive outlook. Mr. McLean said the city will almost certainly end 2011 in the black, thanks to an $8 million boost from the sale of city-owned parking garages to the Toledo-Lucas County Port Authority in December. The Bell administration had originally projected an estimated $7 million budget deficit if the garages weren't sold.

Plans are also taking shape to fund recreation programs this summer, including youth sports and swimming pools, Mr. McLean said. The mayor's original proposal cut recreation funding by about a third, which threatened to cut many of the city's leisure offerings. That prompted an outcry from Toledo residents, the director said.

Mr. McLean would not give specifics on how the recreation funding gap would be closed, but said he is confident a resolution will be found by next week. But he cautioned that officials have yet to come up with a long-term strategy for recreation funding.

"Without question, we're going to need long-term solutions," he said. "We share the public's concern that we want to find a way to get the recreation program funded."

The Bell administration also hopes to put forward a comprehensive plan to fund road paving, he added. The plan would include residential streets, which have suffered from neglect recently because of budget constraints. Mr. McLean said the plan will be worked out once the operating budget is confirmed.

"We would like to have a robust road construction program," he said. "I'm optimistic that we can do a lot more than we did last year."

Tax collections for the city in 2011 showed continued improvement over the previous year, a sign the local economy is starting to climb. Although final collection figures are pending, numbers to date show the city took in $9.1 million more in tax revenue during 2011 than it did in 2010, more than a 7 percent increase. The figures are still behind 2007 levels, but officials lauded the trend as a positive indicator for the city's financial health in 2012.

"Clearly the economy is continuing to improve slowly and surely in Toledo and northwest Ohio, and we're seeing the results from that," finance committee chairman George Sarantou said. "I continue to be cautiously optimistic that we are going to continue to see positive tax collection efforts."

The councilman agreed the possible loss from the casino delay would hurt the city's finances. But he emphasized the overall picture for Toledo is good, given the jobs the Hollywood Casino is expected to create and additional hiring in the works at Chrysler's Toledo North Assembly plant.

Councilman D. Michael Collins said he is also encouraged by the city's tax revenue report. However, he said he is concerned that a pending unfair labor practice lawsuit by the Toledo Police Command Officers' Association against the city could derail the 2012 financial plan. The complaint, which questioned the legality of council's vote to impose "exigent circumstances" and require workers to pay larger pension and health-care contributions, has been pending since March, 2010.

Contact Claudia Boyd-Barrett at cbarrett@theblade.com or 419-724-6272.