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Dayton Business Journal...
Gambling foes mull
lawsuit over slots at Ohio tracks
by Jeff Bell, DBJ Contributor
Thursday, June 16, 2011
An agreement that would open the door for slot machines at Ohio horse
racing tracks is facing a possible legal challenge even before the ink
is dry on the deal brokered by Gov. John Kasich and gaming operator
Rock Ohio Caesars LLC.
The Ohio Roundtable, a longtime foe of expanded gambling in the state,
is looking at filing suit over the agreement, which would allow the
state’s seven tracks to add slot machine-like video lottery terminals.
The organization is a conservative public-policy group based in
suburban Cleveland.
“It’s not set in stone or 100 percent something we’ll go after, but
it’s something we’re discussing,” said Ohio Roundtable Vice President
Rob Walgate of a lawsuit. “We did it before in the same type of
situation.”
He was referring to the lawsuit it filed in 2009 in which it asked the
Ohio Supreme Court to invalidate on constitutional grounds a
VLTs-at-the-tracks plan backed by former Gov. Ted Strickland. The group
claimed the Ohio Lottery does not have the constitutional authority to
operate such gaming and any slots plan would need to be approved by
Ohio voters.
The Supreme Court dismissed the case after it ruled in another lawsuit
that Strickland’s VLT plan was subject to a voter referendum. The
referendum never came to pass after Strickland shelved his proposal.
But the issue surfaced again Wednesday when the VLT proposal was
included in a broader gaming agreement Kasich reached with Rock Ohio
Caesars, developer of casinos in Cleveland and Cincinnati. Like
Strickland’s plan, it calls for the Lottery Commission to operate the
VLTs at the tracks.
The deal has ramifications for Dayton, as Penn National Gaming Inc.
announced a project earlier this year for a “racino” in north Dayton,
which would relocate Beulah Park horse track in Columbus to the old
Delphi facility at Needmore and Wagner Ford roads.
Penn’s complex would include a one-mile horse track, sports bar,
restaurants and large slot machine area. In total, officials expect the
track and gaming center to create 1,500 direct and indirect jobs in the
Dayton region, with 1,000 construction jobs.
Penn has said it needs to clear two major regulatory hurdles before it
will move forward with the plan: state approval for video lottery
terminals, or VLTs, at Ohio racetracks and the Ohio State Racing
Commission’s blessing to move Beulah Park from Columbus to Dayton. Once
those two pieces are in place, company officials expect a complex to be
up and running within 18 to 24 months.
Although Wednesday’s agreement does not apply yet to Penn — which is
developing casinos in Columbus and Toledo — that could change soon,
according to a source familiar with the discussions between Penn
National and the Kasich administration.
The Ohio Roundtable denounced the deal within moments of Kasich and
Rock Ohio developer Dan Gilbert announcing their agreement in Cleveland.
“Any deal to place slot machines at Ohio racetracks is a clear
violation of the Ohio Revised Code and the constitution,” the release
said. “Such a practice cannot become legal by edict of the governor or
any deal struck with casino operators. If the governor wants to open
racetrack casinos with Vegas-style slot machines, he is required to
take such a proposal to the voters.”
The Roundtable also said Kasich does not have the legal authority to
change terms in the constitutional amendment that Ohio voters approved
in November 2009 to allow casinos to be built in Columbus, Toledo,
Cincinnati and Cleveland. Part of the governor’s deal with Rock Ohio
stipulates the casinos will pay the state’s commercial activity tax on
wagers minus payouts to winning bettors instead of on wages only. The
Roundtable said such a special tax treatment was not specified in the
constitutional amendment and can only be made through additional
voter-approved amendments.
Read it with links at the Dayton Business Journal
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