A gambling bill that passed the Indiana Senate this week would send an estimated $900,000 per year in tax receipts from a Terre Haute casino toward operations of the city’s new convention center.
But state Sen. Jon Ford has twice said that provision was included in error and will be removed.
The language was copied into Senate Bill 552 from a 2017 casino bill that died in committee, Ford, R-Terre Haute, explained in a Feb. 22 phone message. That language would be deleted from SB 552, he said.
After it was pointed out that aspect of the bill had not been changed, Ford said Thursday, “It won’t be in there” in any final legislation allowing one of two Gary casinos to relocate to Terre Haute.
“It’s very frustrating to me,” he said. “This [Legislative Services Agency] attorney who’s writing this bill … I don’t know how many times we’ve told him to take it out.”
The bill is now before the House, where other changes are likely and Ford said the error can still be addressed.
The 2017 bill was drafted prior to implementation of a 1 percent food and beverage tax that is expected to provide $1.2 million to $2.1 million in annual revenue for convention center operations.
Jon Marvel, president of the Capital Improvement Board of Managers, said board members initially requested funding from casino taxes, “but now that the food and beverage tax is in place I would think it’s not necessary. Certainly, we haven’t pushed for it.”
Four of the seven members of the Capital Improvement Board are appointed, rather than elected, officials.
At issue is the distribution of proceeds from the state’s supplemental wagering tax, which was enacted in 2017 to replace an admissions tax.
The admissions tax dated from when riverboat casinos cruised the Ohio River and Lake Michigan. Operators argued it had become burdensome in an era of land-based casinos with patrons entering and exiting the gaming floor multiple times in a day.
The 2017 law directs that, in most counties, two-thirds of supplemental wagering tax receipts go to the host city or county of a casino, still referred to in the statute as a “riverboat.”
There are two exceptions. In Lake County, a different formula is used to also distribute revenue to the Northwest Indiana Regional Development Authority. In Dearborn County, the county council can distribute a portion of revenue to cities and towns without a casino.
The current language of SB 552, the pending measure that allows a Terre Haute casino, requires supplemental wagering tax receipts be distributed according to the following formula:
• 33.33 percent to Terre Haute or Vigo County, depending on where the facility is located
• 33.33 percent to the Capital Improvement Board
• 3.33 percent to the Terre Haute Convention and Visitors Bureau of Vigo County
• 5 percent to the Indiana State Fair Commission
• 3.33 percent to the Indiana Division of Mental Health and Addiction
• 21.67 percent to the state general fund.
Except for the Capital Improvement Board distribution, the formula is consistent with the 2017 legislation that covers existing casinos.
The supplemental wagering tax represents only a portion of taxes that would be paid by a Terre Haute casino.
An analysis by the Indiana Legislative Services Agency projects state revenues would increase by $9 million during the first year of the facility’s operation. The agency estimates the city or county would receive $5.6 million, the Capital Improvement Board $900,000 and the Convention and Visitors Bureau $100,000.
The estimates do not include any amount the city or county would receive through a local development agreement the casino operator would be required to enter into.
A casino also would likely boost Vigo County’s revenue from its food-and-beverage and innkeepers taxes.