Ohio Gaming Law: December 2004 News

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December

Indian Casinos
December 30, 2004

As reported in the Columbus Dispatch, a consultant representing the Eastern Shawnee Tribe stated that the group plans to send Governor Bob Taft formal proposals to locate two casinos along Interstate 75 near Monroe and Botkins. Terry Casey describes the State legislature's interest in gambling as growing and indicates "It's looking more and more inevitable."

According to the Middletown Journal, despite being put into a state of fiscal emergency in August by the State of Ohio, the City of Monroe continues to debate a proposal by the Eastern Shawnee Tribe of Oklahoma to locate a casino and entertainment complex on 175 acres near Interstate 75. According to Monroe's Development Director, a financial analysis of the project estimates that the City stands to receive between $16 million and $53 million dollars in gaming and tax revenue from the project over a 10 year period. Opponents of the project cite social, moral and civic reasons why the casino proposal should not be accepted.

Legislator Looks to Legalize Casinos
December 30, 2004

The Plain Dealer recently reported that the House Minority leader, Representative Chris Redfern (D-Port Clinton), says he will push for a vote in next November’s election to legalize casinos in Ohio. Representative Redfern and David Zanotti, head of the anti-gambling Ohio Roundtable group, recently debated the issue at a City Club luncheon. Redfern advocates for the state legislature to put a constitutional amendment before the voters which would allow up to seven casinos across the state, as well as allowing slot machines at Ohio’s racetracks. The proposal for legalizing this gambling can expect a strong push back from Zanotti and the Ohio Business Roundtable. Zanotti commented that billions of dollars will drop from the local economies. However, Redfern contends that casinos could provide relief to the state’s budget problems and deliver tax revenue to help restore services which have been lost in big cities. He commented that the industry as a whole provides 350,000 jobs nationwide, with a $11 billion payroll. Currently casinos are barred by the Ohio Constitution, and a statewide vote is needed to have them legalized.

Mayor Leads Push for Cleveland Casino
December 30, 2004

According to recent Plain Dealer reports, one of Cleveland Mayor Jane Campbell’s top priorities for 2005 will be to bring a casino to Cleveland. This initiative is part of Mayor Campbell’s comprehensive economic revitalization strategy for Cleveland. Campbell’s support for a Cleveland casino will also be part of her re-election campaign in 2005.

An Ohio casino would first require an amendment to the Ohio Constitution, something that has been twice rejected since 1990. To even get the issue on the ballot would require 300,000 signatures across Ohio. In spite of Ohio’s rejection of casinos in the past, Campbell believes that this third attempt has a good chance of succeeding.

According to the Plain Dealer, instead of asking voters to simply decide “yes” or “no,” the proposed amendment would give cities the right to vote on whether they would allow gambling within their particular city. For example, Cleveland voters would decide whether gambling should be permitted in Cleveland. The Plain Dealer also reports that in light of the recent popularity of gambling, supporters have good reason to be optimistic. “Just tune into ESPN and watch the world series poker matches. Even the reruns get good ratings.” In sum, gambling today is much less taboo than in the past.

Cambell’s proposal is also getting support from Cincinnati Mayor Charlie Luken who has been noticing an uncomfortable trend where droves of people from Hamilton County and Southwest Ohio travel to Indiana to gamble on riverboats. The mayor of Toledo has also been reported to be a supporter of the amendment.

In a recent editorial, Plain Dealer Associate Editor Phillip Morris, who is in support of the amendment commented that Campbell’s push for a casino makes economic sense in that it offers significant new revenue. “We are now surrounded by states that allow for gambling (with the exception of Kentucky). We are the big hole in the Midwest gambling donut. We have become generous donors to other states’ gambling enterprises and their state budgets… Something’s got to give. The good folks in Mississippi and places much closer, long ago figured out the advantages of responsible gambling. It’s part time that we do the same here.”

Middletown TV Station May Host Poker Fundraiser
December 30, 2004

According to the Middletown Journal, the local Middletown television station may be the host to a televised Texas Hold ‘em tournament like ones seen on ESPN and the Travel Channel. Leonard Robinson, station board member and volunteer, said he will most likely go before the Middletown City Council in the upcoming months and propose a poker tournament from the station as a fundraiser. The station’s funding was cut by one-third for 2005 by the city council to help balance the city’s $27 million budget. TV Middletown is considering several options to increase funding; the station is primarily funded through the city by its franchise agreement with Time Warner cable. Robinson commented that the details about the organization of the tournament, and who will play, still need to be finalized. The Ohio Attorney General’s office has issued a press release describing the circumstances under which such tournaments can be held. All of the current poker tournaments being held in Ohio are being operated as “charitable festivals.”

Attorney General to Give Money Confiscated in Bingo Ticket Scam to Charities
December 21, 2004

According to the Cincinnati Post, Attorney General Jim Petro will oversee the distribution of $4.7 million, to Ohio counties. The $4.7 million was recovered in connection with an instant bingo scam. The Hamilton County Common Pleas Court recently ruled that Petro has until January 18, 2005 to submit a plan to the court for distributing the money. In order for a charity to be eligible for the money, the charity must provide medical and therapeutic services to people with mental or physical disabilities. The only charity the court has awarded money to thus far is Apple Patch Community Inc., which was a charity that was originally designated to receive some of the money.

The Cincinnati Enquirer reported that the money is a result of an effort by Hamilton County sheriff’s deputies and other law agencies in raiding homes and businesses of the charity-scamming organizers in November of 2000. The scam began in 1997, with a change in the interpretation of state law, that allowed bars and other businesses to sell instant-lottery tickets if all proceeds went to recognized charities. The charities were then supposed to supervise the tickets and keep records. The law has since been changed. The group’s two ringleaders, Phillip F. George, Jr., 45 of Akron, and James H. Jackson, 66, of Talmadge, were convicted of skimming millions from the sales of the pull tab tickets in the illegal gambling scheme. Officials have commented that the group had kept millions of dollars for themselves while paying charities only a fraction of what they were owed. Judge Fred Nelson commented that this occurred even though state law forbids anyone from making salaries, wages, commissions, administrative fees or kickbacks from the sales. Since the raids, more than twenty people have been convicted of crimes relating to the scheme.

Fewer Ohioans Visited Casinos in 2003
December 21, 2004

The Columbus Dispatch has reported that according to an annual survey of gambling, fewer Ohioans visited casinos in 2003 than during the previous two years. The annual survey found that 19 percent, 1.54 million, of Ohio’s adults visited a casino at least once last year. This is down from 19.7 percent in 2002 and 21.9 percent in 2001. The survey was conducted by Harrah’s Entertainment, Inc. Harrah’s spokesperson, Dean Hesterman, commented that the state’s weak economy could be a factor in the decline, as fewer people have the disposable income to spend on gambling.

Some of Ohio’s legal gambling is down as well, as the state’s seven horse-racing tracks report a 7 percent decrease so far this year. However, Ohio Lottery ticket sales, with the addition this year of the multistate Mega Millions game, has risen by 3.7 percent to $2.15 billion during the fiscal year which ended June 30, 2004. Every state which borders Ohio, with the exception of Kentucky, has casino-style gambling. Pennsylvania’s legislature recently approved up to 60,000 slot machines at various sites throughout the state. West Virginia has video slots, Michigan has corporate and Indian owned casinos, and Indiana has riverboat casinos.

Monroe Possible Site for Indian Casino
December 21, 2004

According to the Middletown Journal, the Monroe City Council recently viewed plans for a possible casino complex in Monroe, to be built by the Eastern Shawnee Indian tribe of Oklahoma. Monroe and Botkins, are the only communities targeted along Interstate 75 as possible casino sites. City officials commented that they are still in the preliminary stages of the project and want to be sure that it is in the best interest of the city before completely committing to the idea. The tribe is looking to purchase 150 acres in Monroe for the casino complex. According to the Cincinnati Enquirer, the tribe plans to approach state officials early in 2005 to discuss current state law, as it would need to be changed to build any casinos in Ohio. In addition, the tribe will need to enter into a compact with the state for the casinos.

The Cincinnati Enquirer reported that the plans include not only a casino, but a large development of retail, entertainment, offices and a recreational district. The development plan, which was recently unveiled to the Monroe City Council, showed three casino buildings, a parking garage, a hotel and an events center. Once the casino is built, the tribe has plans to expand to another 750 acres which would include an outdoor “lifestyle” center, a family entertainment district with amusements and restaurants, a 40-acre lake, as well as an Indian village “living museum.” According to Monroe Development Director Jay Stewart, if approved, the casino alone would generate $1.5 million annually for Monroe in earnings taxes. The Middletown Journal reported that a Middletown area developer, Leonard Robinson, has said that the whole site is tentatively named “Wild Creek”. Robinson reported that the site could eventually produce $750 million in development and approximately 3,000 employees.

Hawk Receives Lifetime Sentence; Ohio’s Racetracks Agree on 2005 Dates
December 21, 2004

According to the Plain Dealer, the Ohio State Racing Commission recently met and suspended David Hawk, standard-bred driver, for life. Hawk was found guilty of wagering on horses, other than his own, in races he participated in at Northfield Park, in 2003. He was cited for at least seventeen violations where Hawk bet against himself from a cell phone on Northfield’s grounds. For the previous eight years Hawk finished among the top twenty drivers in North America, and in his twenty-three year career, he rode 5,523 winners and ranks among the winningest drivers in standardbred history. These winnings reach over $21,839,553. Hawk’s suspension begins immediately.

The Plain Dealer also reports that the Ohio State Racing Commission has recently agreed on a plan to reduce the number of live racing dates for 2005. The Commission held a meeting on November 2 to try to reach a consensus. However, the final agreement was not reached until the Commission’s regularly scheduled monthly meeting on November 18. The Commission’s chairman, Scott Borgemenke’s, original plan for 2005 called for a total of 770 dates, which was then revised to 879. The final count at the last Commission meeting was 949, which is just 27 days less than what is being raced in 2004.

Pennsylvania Casino Operator to Buy the Owner of Argosy Casino
December 21, 2004

According to the Cincinnati Enquirer, the Pennsylvania based casino and racetrack operator, Penn National Gaming, Inc. will buy the owner of Lawrenceburg’s Argosy riverboat casino. Penn National Gaming will buy Argosy for $2.2 billion, which will create the third-largest gambling company in the nation. Executives for each company commented that the deal will create $20 million in savings by eliminating duplicate jobs and other associated costs. The deal is anticipated to close in six to nine months pending shareholder and regulatory approval.

The combined company is estimated to produce annual revenue of more than $2 billion, with over 20,000 slot machines and approximately 700,000 square feet of casino space. Argosy owns riverboat casinos near cities in Illinois, Missouri, Louisiana and Iowa, in addition to the Lawrenceburg casino.

Botkins Village Council Approves Sale of Land for Eastern Shawnee Casino
December 21, 2004

The Lima News recently reported that the Botkins Village Council has approved two documents pertaining to the Eastern Shawnee tribe, of Oklahoma, who is seeking to establish a casino in the village. The two documents were an intergovernmental agreement and a real estate purchase agreement relating to 50 acres of land owned by the village, adjacent to Interstate 75 and State Route 274. The purchase will be an outright sale of the property, with the tribe paying $600,00 for the land. Since the process could take years for the Eastern Shawnees to have the land placed in trust by the Interior Department of the federal government, the purchase agreement is effective through 2009. The tribe is also looking to purchase an additional 83 acres of farmland owned by several local residents. The anticipated cost of this land is $663, 392.

According to the Dayton Daily News, Tom Schnippel, president of National Capital I, a development company representing the tribe, reported that the tribe plans to build a 60,000 square foot casino in Botkins, costing approximately $50 million. This casino will include 1,500 slot machines, and 45 to 50 table games including blackjack and poker. Additionally there are three restaurants and retail space planned for the casino. The resort is anticipated to employ 1,500 people initially, but could eventually employ over 2,000.

Terry Casey, a consultant to the tribe and National Capital I, said he expects that it will take three to seven months before the tribe applies to the Interior Department to place the land in trust. He anticipates a permanent casino resort opening in Botkins in 2007. Casey also commented that meetings are being scheduled for early next year with Ohio legislators and other elected state officials to discuss plans for this casino, as well as the possibility of the tribe locating six other casinos throughout Ohio.