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STATE AND LOCAL CASINO TAXES

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					EXHIBITS To Accompany Presentation—
ASSESSING IMPACTS OF EXPANDED GAMING IN RHODE ISLAND: FRAMEWORK FOR ANALYSIS

EXHIBIT Page I: STATE CASINO LICENSING FEES & TAXES…………………..…2 II: INTERNET GAMBLING PORTAL: …………..…………………….4 III: “EARMARKING” OF STATE GAMING REVENUES…………….6 IV: STATE GAMING REFERENDA: CURRENT & RECENT………...8
Source: NCSL survey of Commerce Clearing House summary of state tax laws, 2000 and updated Juy 2002.

Rhode Island Special House Commission to Study Gaming  Gary Ciminero Rhode Island House Policy Office  September 17, 2002

EXHIBIT I
STATE CASINO LICENSING FEES & TAXES
Sources: National Conference of State Legislatures (NCSL) survey of Commerce Clearing House summary of state tax laws, 2000. Information for Colorado, Illinois, Indiana, Iowa, Louisiana, Mississippi and Missouri updated 7/02, compiled and emailed to GC courtesy of Monica Kearns, NCSL. Other information on select Indian Gaming Facilities compiled by GC and added to the exhibit. A number of other states have tribal casinos that have no financial obligation to the state other than to reimburse any regulatory costs incurred on the part of state government.

Note:

STATE Colorado

Connecticut

CASINO TAXES/FEES Casino tax:  Progressive Rates—  Ranging from 0.25% tax on $0 - $2 million in adjusted gross proceeds (AGP)  Increasing to 20% tax on AGP above $15 million. Tribal Casinos—Revenue sharing agreement: Each of two tribal casinos pay the greater of  25% of their slot machine revenues  Or $80 million. Racetrack Slots/Video Gaming: Progressive Rates on Average Daily Win—  Ranging from 12.5% of $0 - $25k  Increasing to 30% of amounts exceeding $75K Riverboat Gaming—  Admissions tax: $2/person.  Progressive Wagering Tax Rates—  Ranging from 15% tax on $0 - $25 million in adjusted gross receipts  Increasing to 35% of adjusted gross receipts in excess of $100 million. Riverboat Gaming—  Admissions fee: $3/person.  Dockside Boats Levied Progressive Wagering Tax Rates—  Ranging from 15% tax on $0 - $25 million in adjusted gross receipts  Increasing to 35% of adjusted gross receipts in excess of $150 million  Cruising Boats—Levied a Flat Tax of 22.5% of adjusted gross receipts Excursion boat Gaming—  Admissions Tax of $0.50/person  Imposed by state  Plus an additional $0.50 each authorized by cities/counties  Progressive Wagering Tax Rates—  Ranging from 5% on $0 - $1 million in adjusted gross receipts  Increasing to 20% of adjusted gross receipts in excess of $2 million Riverboat Gaming—wagering tax:  Shreveport-based boats phasing from 18.5% up to 21.5% on net proceeds.  Bally’s boat in New Orleans: Progressive Wagering Tax Rates on “Monthly New Proceeds—:  Ranging from 18.5% on $0 - $6 million  Increasing to 21.5% over $8 million  Riverboat admissions fee—local option: up to $2.50 or $3 per person, depending on the parish. New Orleans land-based casino tax:  21.5% of net revenues or $50 million, whichever is greater

Delaware

Illinois

Indiana

Iowa

Louisiana

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Michigan

Michigan

Mississippi

Detroit Casinos  Casino wagering tax—18% of GGR  Municipal service fee—greater of 1.25% of gross revenue or $4 million.  Annual Assessment: initially $25 million adjusted annually by the CPI. o Equal share of levy imposed on each of 3 (three) casinos. Tribal Casinos—Revenue sharing agreement  10% of slot revenues until other non-tribal casinos are operational in state.  No tax due once other non-tribal operations commence. (Some have agreed to continue the payment even after Detroit casinos were opened.) Riverboat Gaming—  Progressive “Wagering License Fee” levied on monthly gross revenue (GR):  Ranging from 4% on $0 - $50K  Increasing to 8% over $134K.  City or county may impose a license fee ranging from 0.4%, to 0.6%, to 0.8% on GR.  Many local governments also impose an additional 3.2% tax on GR. Riverboat Gaming—  Admissions fee of $2 per person  Plus a wagering tax of 20% of AGR Non-casino/non-track Video Gaming/VLT—  Tax of 15% of net lottery machine revenues (after pay-outs)  Annual state device/license fees o $200 per device o $1,000 license fees imposed on manufacturer and distributor Casino License Fees & Taxes  License fees: imposed at both state and local level. o County monthly fees range from $10 to $50. o State fees:  Monthly fees range from 3% to 6.25% of gross revenues.  Annual fees range from $100 to $6,000 based on establishment.  Additional annual $80 fee peer slot machine is imposed for an unrestricted state license.  A restricted quarterly state license fee ranges from $45 per machine to $225 plus $90 per machine.  Slot machine tax: annual fee of $250 imposed on each machine.  Casino entertainment tax: 10% of amounts paid for admission, food, refreshments and merchandise. Casino License Fees & Taxes  License fees:  Minimum initial fee—$200K  Minimum annual renewal fee—$100K.  Slot machine annual license—$500.  Gaming tax: 8% tax on casino gross revenues.  Investment alternative tax: 2.5% on the gross revenues of casino licensees. Taxes are imposed on slot machine revenues Gaming tax: 8% is imposed on adjusted gross proceeds.

Missouri

Montana

Nevada

New Jersey

Puerto Rico South Dakota

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EXHIBIT II INTERNET GAMBLING PORTAL: www.internet-gambling-portal.com/

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EXHIBIT III
“EARMARKING” of STATE GAMING REVENUES
Source: National Conference of State Legislatures (NCSL) survey of Commerce Clearing House summary of state tax laws, 2000. Information for Colorado, Illinois, Indiana, Iowa, Louisiana, Mississippi and Missouri updated 7/02, compiled and emailed to GC courtesy of Monica Kearns, NCSL. Other information on select Indian Gaming Facilities compiled by GC and added to the exhibit.

STATE Colorado

Connecticut Delaware

USE OF REVENUE  28% to the Colorado Historical Society for historical preservations grants  12% to Gilpin and Teller County governments, in proportion to the gaming revenues generated in the respective counties  10% to the city governments of Black Hawk, Central City, and Cripple Creek, in proportion to the gaming revenues generated in each  0.2% to the Colorado Travel and Tourism Promotion Fund  49.8% to the state general fund, of which the following are designated: 2% to the Municipal Impact Fund for the cities of Woodland Park and Victor; at least 11% to the Local Government Limited Gaming Impact Fund; and an amount to be determined annually to the Colorado Department of Transportation. General revenue fund and local governments. Local governments and the state education assistance fund. Each local government that serves as a host community for a casino licensee receives a share of gaming taxes in an amount equal to 5 percent of the adjusted gross revenue and one-half of the admission tax attributable to the licensee within its jurisdiction. Admissions tax:  $1 to the city where the riverboat is docked  $1 to the county where the riverboat is docked  $0.10 to the county tourism promotion fund  $0.15 to the state fair commission  $0.10 to the division of mental health  $0.65 to the state horse racing commission.  Riverboats operating on Patoka Lake have separate revenue distribution provisions. Wagering tax:  25% to the riverboats’ home cities and counties, up to $33 million (the total local distribution level for 2002)  75% to the property tax replacement fund and the Build Indiana Fund lottery and gaming surplus account.

Illinois

Indiana

Iowa

 One-half of one percent (0.5%) of adjusted gross receipts to the city from which the gambling excursion originated  Another one-half of one percent (0.5%) to the county in which the gambling excursion originated  0.3% to the Gamblers Assistance Fund  The remainder goes to the state general fund Riverboats:  9% of state revenues go to an education fund for teacher salaries/pay raises  1% of state revenues go to a compulsive gambling program  Remaining state revenues go to the general fund for gambling enforcement Land-based casino:  All state revenues go to the education fund for teacher salaries/pay raises. Local government revenue allocations are determined by Louisiana Revised Statutes Title 27, section 93. 7

STATE Louisiana Michigan

USE OF REVENUE Forty-five percent to the state school aid fund and 55 percent to the city where casino is located for public safety and economic development.  $3 million or 25%, whichever is greater, of the state monthly revenue share goes to retire bonds until 2012  Any amount in excess of $3 million but less than 25% goes to the state Highway Fund until 2012  The remainder goes to the state general fund. All of the state revenues go to the general fund after 2012. Admissions fee:  $1 to the state gaming commission; $0.01 of this goes to the compulsive gamblers treatment fund  $1 to the home dock city or county Wagering tax:  10% of the adjusted gross receipts revenues go to local governments  The state share of adjusted gross receipts go to an education fund Local governments and state general fund. Casino revenue funds provide financial assistance to the elderly and disabled.  34% to hotels  20% to the University  20% to education  9% to economic development  17% to tourism. General revenue fund and historic preservation.

Michigan

Mississippi Missouri Montana

Nevada

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EXHIBIT IV
STATE GAMING REFERENDA: CURRENT and RECENT
Source: Relayed by Monica Kearns, NCSL, from the Listserve of the National Association of Legislative Fiscal Officers.

STATE ARIZONA

ARKANSAS CALIFORNIA

COLORADO GEORGIA

FLORIDA IDAHO LOUISIANA

RECENT REFERENDA Lottery Referendum— 1998: Voters passed a referendum to extend state lottery until 7/1/03 November 2002 Ballot: Three Indian Gaming initiatives Gaming Referendum— 2000: Whether to establish statewide lottery and permit charitable bingo and casinos—FAILED Lottery Referendum— 1998: To establish terms and conditions of compacts between state and Indian tribes for gaming on Indian tribal land and to authorize slot machines and banked card games at tribal casinos—PASSED Lottery Referendum— 2000: To allow participation in multi-state lotteries—PASSED Lottery Referendum— 1998: Amending the state constitution to limit educational purposes for earmarking lottery proceeds, giving piority  to scholarships, pre-kindergarten programs, and shortfall reserves over teacher technology training and capital  outlays for educational facilities—PASSED Florida voters defeated a casino gambling referendum in November 1994. It did not earmark revenues. Lottery Referendum— November 2002 Ballot: Indian Gaming initiative Gaming Referenda— 1996: 33 parishes voted to shut down video poker machines by 1999; 31 parishes voted to keep video poker. [Machines in riverboat casinos, New Orleans French Quarter, racetracks and off-track betting parlours not affected.] Lottery Referendum— 2000: Whether to establish a video lottery—FAILED Dog racing Referendum— 2000: Whether to prohibit dog racing in the state—FAILED Gaming Referenda— 1996: “Proposition E”, authorizing three licensed casinos to be built in Detroit—PASSED. [Later substitially improved and strengthened, presumably by legislation, and signed into law as the Michigan Gaming Control & Revenue Act, AA (Public Act 69 of 1997; MCL 432.201] Gaming Referenda— 1988: Voters adopted a constitutional amendment to allow a state lottery. 1990: Constitutional amendment adopted to dedicate 40% of lottery proceeds to the Environment & Natural Resources Trust Fund. 1994: Voters rejected a constitutional amendment to authorize off-track wagering on horse racing.

MAINE MASSACHUSETTS MICHIGAN

MINNESOTA

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STATE MISSOURI

NEBRASKA

NEW JERSEY

NEW MEXICO OKLAHOMA OREGON

SOUTH CAROLINA

SOUTH DAKOTA

TENNESSEE

UTAH

VIRGINIA WASHINGTON

WEST VIRGINIA

RECENT REFERENDA Riverboat Casino Referendum— 1998: Whether to approve constitutional amendment, authorizing riverboat casinos to remain dockside— PASSED Gaming Referenda— 1990: Whether to establish a NB State Lottery System, operated by certain nonprofit organizations—FAILED 1992: State Lottery passed—referendum adopted 1992: Whether to use proceeds of state lottery to compensate depositors of Industrial Loan & Investment companies for unreimbursed losses—FAILED 1996: Whether to remove restriction that pari-mutuel horseracing be conducted within licensed racetrack enclosures—FAILED Current: One new initiative (details currently unknown) introduced this year but not yet voted on. Gaming Referenda— Since 1990, nothing on gaming, per se. Gaming-related referenda include— 1998: Allows Legislature to regulate horserace wagering and simulcasting—not through referenda—PASSED 1999: Prohibiting state lottery proceeds from being used to support correctional system costs—PASSED Gaming Referendum— 2000: Whether to construct a casino or racetrack in McKinley County—FAILED Gaming Referendum— 2000: Whether to authorize casino gambling—FAILED Lottery Referendum— 1998: Whether to dedicate 15% of net lottery proceeds to a new fund for parks, beaches, wildlife habitat, and watershed protection—PASSED Gaming Referenda— [1999: SC Legislature passed a ban on video poker but gave voters the right to decide by referendum whether these games should remain legal. SC Supreme Court blocked the referendum, saying the legislature should not delegate its power, but kept in place part of the law that banned these games.] 2000: Whether to create a state lottery—PASSED Gaming Referenda— 1992: Whether to keep VLTs—PASSED 62.8% to 37.2% 2000: Whether to increase betting limits in Deadwood, SD—PASSED Lottery Referendum— 2002: Whether to approve a constitutional amendment to create a state lottery.[The state had allowed charity bingo until a 1989 TN Supreme Court ruling decided it was a lottery and therefore banned by the TN constitution. Gaming Referenda— 1992: Citizen initiative allowing pari-mutuel betting on horses; revenues earmarked to regulate racing— FAILED Lottery Referendum— 2000: Whether to direct lottery proceeds specifically to public education—PASSED Lottery Referenda— 1996: Whether to authorize electronic gaming on Indian lands with joint regulation and earmarking—FAILED 2000: Whether to direct lottery proceeds specifically to public education—PASSED Casino Referendum— 2000: Whether to allow the Greenbriar Resort in WV to open a casino—FAILED 10

NOTES: Website of I. Nelson Rose, law professor and well-known gaming scholar, at www.gamblingandthe law.com/dates.html LaFleur’s Lottery Fast Facts, charts lotteries, when established and how (by legislation or referendum, etc.). See www.lafleurs.com/fastfacts

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