Casino tax earnings on track with pre-Katrina numbers|[10/25/07]

Published 12:00 am Thursday, October 25, 2007

Tax revenue collected by local government from Vicksburg’s four casinos finished the 2006-07 fiscal year behind totals from last year’s hurricane-skewed totals, finishing September in line with pre-storm trends.

Totals available this week quantified the gradual return to trends seen before Hurricane Katrina, which hit in August 2005 and drove gaming business in the state toward the Mississippi River while casinos on the Gulf Coast rebuilt over a year-long period. For Vicksburg, the added take was about $1 million.

Hopes remain for the Vicksburg market to stay on an even keel while a fifth casino is being built and two more are in preconstruction phases.

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“Until then, we feel it’s a stable market,” Mississippi Gaming Commission deputy director Allen Godfrey said.

Revenue collected by the city equaled $482,451 in September, down 9 percent from August but ahead of September 2006. For the year, Vicksburg was paid $7,019,109 in revenue taxes.

Warren County expects to take in $227,296 for September, up a tad from the $226,150 last year. Warren County will take in $3,025,041 from local casinos in 2006-07, about $428,000 less than in 2005-06.

Of a 3.2 percent tax on wagers the casinos collect, 10 percent goes to schools, 25 percent to Warren County and 65 percent to the City of Vicksburg. A second revenue tax is an .8 percent share of the state’s 8 percent revenue tax. It is split based on population proportions between Vicksburg and Warren County.

Vicksburg also receives $150 per gaming position per year, called a device tax. Paid about every other month, that fee generated $595,050 for the city last year.

Monthly figures are compiled based on when area casinos collect the money, whereas Warren County records it when payments actually arrive.

Compared to the last budget year before Katrina, numbers looked slightly better. Vicksburg collected just more than $6.8 million and Warren County $2.9 million during 2004-05.

While the numbers were not completely unexpected, the arrival of one new casino in Vicksburg in the next 18 months and the possibility of two others being approved promises to put more cash in local coffers.

Vicksburg’s $30 million spending plan for 2007-08 estimates $6.44 million from gaming taxes will flow to the general fund. In the county, where gaming money is treated separate and apart from its general fund, just more than $2.6 million is expected to help pay for paving, anti-erosion projects, recreation and some of its charitable contributions.

All casino developments, including their hotels and other amenities also pay property taxes, most of which goes to schools, and collect sales, tourism and bed taxes.

Riverwalk Casino is scheduled to have its $150 million facility on Warrenton Road opened by late 2008. A few miles up the road, the purchase of the planned Mississippi Bluffs casino and golf complex by Nevada-based American Gaming Enterprises is expected finalized by December.

Minnesota-based Lakes Entertainment has until February 2009 to show finances to the state for its projected $100 million casino off U.S. 61 South. Its deal is contingent on developing about 150 acres of former railroad right-of-way purchased temporarily from the City of Vicksburg.

Industry analysts have doubted whether the local economy can support seven casinos, terming the Vicksburg gaming climate flat. State regulators see hope for growth, based on the level of interest taken by the three proposed developments.

“It’s still positive when they’re willing to take it to the next level,” Godfrey said.

As for gross revenues, Mississippi’s casinos reported $239 million in September, down just $175,000 from August. Mississippi River casinos reported $127 million in September, down $3 million from August but in line with five previous Septembers before Katrina.

Coastal casino revenues enjoyed a record September, buoyed by openings in the past year of Silver Slipper Casino near Waveland and Hard Rock Casino Biloxi. Eleven casinos are on the coast.

Mississippi Gaming Commission officials have said total gross gaming revenue could top $3 billion this year, which would surpass a previous high of more than $2.7 billion in 2004.

The Legislature passed enabling legislation for casino development in coastal and Mississippi River counties that did not object in 1990. Since then, the state and localities with casinos have collected a total of $3.9 billion in taxes on slot machine play and table games.