Casino tax no bonanza for Akron-Canton area

Elected officials say forecasts were inflated

5/12/2013

AKRON — In the 12 months since Ohio opened its first casino, Akron-Canton region has received nearly $15 million in new tax revenue.

Counties, public schools, and the cities of Akron and Canton have all received distributions from the Casino Tax Revenue Fund.

Although officials said they were happy to take the money, it was no windfall. The new income did not come close to making up for recent cuts in state aid.

Brian Nelsen, Summit County budget director, said this year, the county will lose $6.5 million between reductions in local government funding and the phaseout of the tangible property tax. During the same period, he expects to get about $2.9 million from the casinos. “It helps, yeah, but it doesn't make up for it,” he said.

Akron Finance Director Diane Miller-Dawson echoed that thought.

The city expects local government funds to dip 23 percent this year and the estate tax the state ended in December cost Akron about $4.2 million a year.

So the $2.1 million sent to the city from the casino fund over the last 12 months is falling short.

“Originally it was expected and touted as a source to fill the holes left by the loss of local government and estate taxes. It is lacking and therefore, very disappointing,” she said.

The casino money is generated by a 33 percent tax on gross receipts once winners are paid. Of the amount collected, 51 percent goes to the state’s 88 counties, based on population. The state’s eight largest cities (which include Akron and Canton) get half of their county’s take.

Public school districts share 34 percent of the fund, based on enrollment, with the rest going to things like a gambling addiction fund and law enforcement training.

In addition to the $2.1 million given to Summit County and Akron, the fund distributed $1.4 million to Stark County and the same amount to the city of Canton, $1.3 million to Medina County, $1.2 million to Portage County, and $884,000 to Wayne County.

Public schools in the Akron-Canton area shared about $4.4 million in the first distribution from the fund in January, with checks ranging between $11,000 for the area’s smallest district (Black River in Medina County) to $463,000 for the largest (Akron).

Statewide, the total distribution of $174 million in the last 12 months is a far cry from the $643 million that the Ohio Department of Taxation once predicted would be earned in the first full year of operation.

State officials said those early estimates — made in 2009 when Ohio voters amended the state Constitution to allow for the casinos — are no longer relevant because some casinos are smaller than originally planned, and because the state allows so-called “racinos.” So far, two racetracks have been allowed to install video lottery terminals, and that has taken a piece of the gambling pie.

More recently, the County Commissioners' Association of Ohio has taken a crack at guessing what counties might receive in 2014 and are predicting the 12 months of that calendar year will nearly triple the past year's collection.

The report issued last year estimates Summit County and Akron, for instance, could each receive closer to $5.5 million by year's end. Stark County and Canton could see $3.8 million each next year, Medina County $3.5 million, Portage County $3.3 million, and Wayne County $2.3 million. Summit County’s Mr. Nelsen said he doesn’t put much stock in estimates anymore.

When the casinos were going before voters, the county was told to expect about $7.5 million a year. Now, the county will not count on the $5.5 million predicted for 2014. “We’re forecasting $3.5 million [in 2014,] and based on what casinos did last quarter, $3.5 million is probably where we're going to be,” he said.