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P. 1
Racino Letter 01-12-11

Racino Letter 01-12-11

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Published by Celeste Katz

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Published by: Celeste Katz on Jan 12, 2011
Copyright:Attribution Non-commercial

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01/12/2011

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GAMING
ANDRACEWAY
January11,2011
Steve
CohenOffice
of
the
Governor
110
StateStreet
Albany,
NY
12207
Robert
MegnaNewYork
State
Divisionof
theBudget
StateCapitol
Albany,
NY
12224
GordonMedenicaNewYork
State
DivisionofLottery
1
Broadway
Ctr,
#700Schenectady,
NY
12305
Dean
G.
Skelos
Majority
Leader
NewYorkStateSenateCapitol,
Rm.315
Albany,
NY12247
Sheldon
Silver
Speaker
NewYorkState
Assembly
LegislativeOffice
Building,
Rm.932
Albany,
NY12248
Re:Fiscal
ImpactsofStockbridge-Munsee
Casino
Compact
Messrs,
Cohen,
Megna,
Medenica,
Silver
andSkelos:On
December
29,2010,
formerGovernor
DavidPaterson,
in
one
of
hisfinal
acts
as
the
leader
of
the
State,
entered
into
a
LandSettlement
and
submitted
a
Compact
to
theFederal
DepartmentofInterior
(DO!)thatwould
give
Wisconsin’sStockbridge-Munsee
Community
Bandof
Mohican
Indians
theability
to
develop
a
Casino
with
table
gamesandslots
in
Sullivan
County,
NewYork.We
believe
that
thisCompact,signed
and
submitted
without
public
input
or
oversightand
at
theveryend
of
the
Governor
Paterson’stenure,posessignificant,
negativebudgetary
impacts
for
New
York
State
thatshould
be
carefully
re-evaluated——particularly
inthis
time
of
fiscal
342
JEFFERSONSTREET
P0
Box
356
SARATOGASPRINGS,
NEW
YORK
12866
PHONE
(518)
584-2110
FAX
(518)
583-1269
 
Messrs,Cohen,
Megna,
Medenica,SilverandSkelosJanuary
11,
2011
Page
2
crises—to
determine
whether
or
not
the
currentNew
York
State
Administration
should
withdraw
the
Compact
and
inform
the
DO!that
it
nolongersupports
the
Compact.
Giventhat
DOT
is
on
a
statutory-mandated
45-day-clock
(endingFebruary
19,
2011)
toapprove
or
disapprove
the
Compact,
we
additionallyrequest
that
you
ask
DO!
to
“stopthe
clock”
until
you
havehad
time
to
more
closelystudy
theeconomicimpacts
set
forth
below.The
!ndian
Casino
would
result
in
the
near-certain
closure
of
theMonticello
Racino,
which
is
located
10
minutes
from
the
proposed
site,
andtakeaway
higher-end
and
weekend
customersfrom
Yonkers,
Resorts
World
New
York
and
Saratoga
Racinos.
By
our
calculation,
thiswilllessen
thestate
tax
revenues
byhundredsof
millions
of
dollarsfortheEducation
Fund
and
Lottery
Administration.
Comingon
top
of
the
closure
of
NYC
OTB,
theopening
of
the
SullivanCounty
Casino
maywell
spelltheend
of
the
New
York
horseracing
industry.We
estimate
annuallossestied
to
the
proposed
casino
to
include
(all
numbers
are
rounded):
$407
million
in
overallrevenue;
$188
million
instate
education
funding;
$127
million
in
racetrack
commissions;
$51
millionhorseracing
industrysupport;
$40
million
in
lottery
administration
fees;
900
employees
and
thousands
morefromeducationand
horseracing
industry.The
reasons
forthese
losses
aresimple:the
proposed
!ndian
Casino
wouldprovide
both
table
games
and
slot
machines,
which
are
moreattractive
than
statesponsoredvideo
lottery
terminals.
In
addition,
Indian
casinospaytaxes
of
anywhere
of
18%to
25%on
slots
and
0%
on
table
games
compared
withRacinosthatpaytaxes
ofanywhere
from
60%
to70%on
video
lotteryrevenues.
The
reduced
tax
structure
provided
to
Indian
Casinos
not
only
immediately
reduces
statetax
and
education
funding,butcreates
a
structural
competitive
advantage
that
cannot
be
overcome
because
IndianCasinos
have
the
ability
to
offer
freeroom,
food
and
beverage
because
of
the
lowtaxrate.
Withlimited
products
and
profoundly
greater
taxes,
Racinos
cannot
and
willnotbe
able
to
effectively
compete.ExistingVLT
Operators
have
already
becomecautious
when
considering
new
or
further
investment
into
theirfacilities.Proposed
new
construction
has
been
minimized
and
expansion
plans
havebeen
delayed
as
uncertainty
remains.
In
addition
to
the900existing
jobs,numerous
newjobs
will
notbeëreated
because
overallinvestmentmustbecurtailed.

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