Kansas Gets Into Casino Biz
It looks like Dorothy and Toto are going to get a chance to roll the dice. This week the Kansas legislature authorized legalized casinos outside Native American reservations through an initiative redefining the state’s lottery system to include the development of a gaming resort in up to four of the state’s counties. The provision will also permit a dog tracks and horse tracks to divvy up and install a total of 2,200 slot machines.The plan is expected to generate about $200 million per year in additional tax revenues for the state, which will get 22 percent of the action. An additional three percent will go to local governments and two more percent will be put into a problem gaming and addiction fund.
The bill had earlier in the week passed through the state’s House barley squeaking by with a vote of 64-28, one more than the minimum required. The same happened in the Senate when the vote passed by a margin of 21-19. The vote was held open well past midnight to allow the final state Senator who was to present earlier in the evening to cast a vote. A 12 hour filibuster was needed to keep hopes alive for those looking to get the initiative passed. Governor Kathleen Sebelius was a supporter of the bill, acknowledging it was a good way to boost state income.
“It was a long time coming,” Senator Jim Barone told the Kansas City Star. “But as in life, all good things are worth waiting for, and this is a good, good thing.”
Opponents stuck to the regular arguments that casino gaming increases crime, gambling addiction and bankruptcies. “You are forever changing the face and culture of Kansas,” said Sen. Karin Brownlee, an Olathe Republican, who told the AP is was the most important vote she had ever cast. “I can’t do that.”
Now casinos are expected to be built in Kansas City, Wichita, Dodge City and southeast Kansas. However, each county will have to separately approve legalizing casinos in their respective jurisdictions.
In an interesting spin, the casinos would actually be owned outright by the Kansas Lottery, which would then work with other companies to manage each casino resort. The state lottery and the Kansas Racing and Gaming Commission would be responsible for all oversight and regulation.
Additionally, those companies agreeing to manage the casinos would have to pay a \"privilege fee\" of $25 million per casino. Casino developers would also be expected to make a minimum $225 million investment in their respective resorts.
At the racetracks, 2,200 slot machines distributed among Woodlands in Kansas City, Wichita Greyhound Park and Camptown in Frontenac, but will get 600 more when the first casino contract is signed. Tracks will have to pay a “privilege fee” of $2,500 per slot machine. Additionally, 45 percent of slot revenue will go the state while 25 percent will go to each facility owner as a management fee, 15 percent is earmarked to cover expenses, seven percent each goes to greyhound racing and horse racing and one percent fund goes to Horse Benefit Fair Fund.
Other interesting facets of the bill include prohibiting the governor, lieutenant governor, attorney general and legislators from working with a gambling company until they\'ve been out of office for five years. Cash from the casinos much go to debt reduction, infrastructure improvements and property tax relief and local governments cannot use eminent domain, STAR bonds, tax-increment financing or tax abatements to help developers. Additionally, a 25-year moratorium on expansion of casinos or more than 2,800 slots has been set up and no tax by a government unit can be used for the minimum investment requirement for casino.
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