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127th MAINE LEGISLATURE |
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LD 1280 |
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LR 1572(16) |
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An Act To Provide
Income Tax Relief by Expanding Gaming Opportunities |
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Fiscal Note for
Bill as Amended by Committee Amendment " " |
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Committee: Veterans and Legal Affairs |
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Fiscal Note Required: Yes |
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| Fiscal Note |
Current biennium cost increase - General Fund
Contingent future biennium cost increase - General Fund
Contingent future biennium revenue decrease - General Fund
Contingent future biennium cost increase - Other Special Revenue Funds
Contingent future biennium revenue increase - Other Special Revenue Funds |
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| Referendum Costs |
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Month/Year |
Election Type |
Question |
Length |
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Nov-16 |
General |
Referendum |
Standard |
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The Secretary of
State's budget includes sufficient funds to accommodate one ballot of average
length for the general election in November.
If the number or size of the referendum questions requires production
and delivery of a second ballot, an additional appropriation of $107,250 may
be required. |
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| Fiscal Detail
and Notes |
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The bill creates a
commission to use a competitive bid process to award the privilege to apply
for a casino to a single applicant. Bidders will pay a $250,000 bidding fee
to win the right to be the applicant. The Gambling Control Board will accept
an application for a casino license in either York County or Cumberland
County from the winning bidder as long as the voters of the State and the
voters of the municipality where the casino will be located vote to approve.
Only one casino, in either York or Cumberland County, may be licensed. |
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The facility would
be taxed at the rate of 35% of net slot income and 16% of net table game
income. The bill requires a casino, beginning no sooner than 5 years after
operation of slot machines, to make annual capital improvements to the casino
using 3% to 4% of both net slot machine income and net table game income or
direct those funds to the Gambling Control Board. This fiscal note assumes
that the facility will not direct these funds to the Gambling Control Board.
This fiscal note assumes a total of 1,000 slot machines and 24 table games,
generating an estimated annual Other Special Revenue Funds (OSRF) revenue of
$25,498,980. |
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Each
non-refundable bid proposal will generate $250,000 in General Fund revenue.
The casino operator license will generate $10,000,000 in General Fund
revenue. The casino operator renewal fee will generate $250,000 in OSRF
revenue every five years. $126,400 in annual OSRF revenue will be generated
from registration fees on slot machines and table games. Annual state costs
associated with 5 inspectors, 1 auditor, 1 detective and 1 office specialist
and other related expenses are estimated to be $763,705. |
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WhiteSand Gaming's
market feasibility study on expanded gaming in Maine estimated a 20%
reduction in revenue to Oxford Casino if a new southern Maine casino were to
open. This fiscal note assumes the same 20% reduction, resulting in an
estimated annual General Fund revenue loss of $379,070 and OSRF revenue loss
of $5,932,193 when the southern Maine casino becomes operational. An
assessment of the impact on revenues generated by Hollywood Casino has not
been done at this time. |
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Under current law,
State revenue from both Oxford Casino and Hollywood Casino go to various
funds, but this bill directs all State revenue from these casinos to go to
the Gambling Control Board until a distribution of slot machine and table
game revenue is established in law. This results in an estimated annual
General Fund revenue decrease of $8,382,405 and an annual OSRF revenue
increase of $8,382,405. The bill requires the new distribution to be 35% of
net slot machine revenue and 16% of net table game revenue for both Oxford
Casino and Hollywood Casino. This results in an estimated annual General Fund
revenue loss of $4,498,347 and an estimated annual OSRF revenue loss of
$7,028,385. Due to the recipients of future net slot machine and net table game
distributions being unknown at this time, there is no current estimate on the
amount of net slot machine and net table game revenue that would go to the
General Fund and OSRF. |
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The additional
costs to the Office of the Attorney General are expected to be minor. |
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Annual |
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Summary of Casino Revenue |
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Estimate |
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Gross Slot Income (total value of money, tokens,
credits and other value used to play slots) |
$659,190,000 |
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Player Payback - Slot Income |
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$591,293,430 |
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Net Slot Income |
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$67,896,570 |
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Share of Net Slot Income for Distribution - 35% |
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$23,763,800 |
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Operator Share of Net Slot Income - 65% |
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$44,132,771 |
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Net Table Game Income |
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$10,844,880 |
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Share of Net Table Game Income for Distribution
- 16% |
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$1,735,181 |
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Operator Share of Net Table Game Income - 84% |
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$9,109,699 |
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State Revenues by Fund |
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General Fund |
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Oxford Casino Revenue Reduced |
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($379,070) |
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Oxford Casino Revenue was GF, now OSRF |
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($1,516,280) |
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Hollywood Casino revenue was GF, now OSRF |
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($6,866,125) |
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Total General
Fund Revenue |
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($8,761,475) |
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Casino Operator License - 1st Year Only |
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$10,000,000 |
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Bidding Fee - assumes 2 bidders |
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$500,000 (one-time) |
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Other Special Revenue Funds |
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Gambling Control Board |
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$25,498,980 |
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Registration Fees |
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$126,400 |
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Oxford Casino Revenue Was GF, now OSRF |
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$1,516,280 |
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Hollywood Casino Revenue was GF, now OSRF |
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$6,866,125 |
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Oxford Casino Revenue Reduced |
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($5,932,193) |
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Total Other Special Revenue Funds Revenue |
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$28,075,592 |
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Casino Operator Renewal Fee (every five years) |
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$250,000 |
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Total Revenue All Funds |
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$19,314,117 |
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Summary of Expenditure Impacts to the State |
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Other Special Revenue Funds |
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-- Public
Safety |
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$126,400 |
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General Fund |
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-- Public
Safety |
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$637,305 |
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Total Expenditure Impacts to the State |
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$763,705 |
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