Sunday, January 14, 2007

The early odds of passing the General Assembly are uncertain, but the
latest, yearly push to authorize slot machines at horse-racing venues in
Indiana will at least get a chance of clearing the gate this session. House
Speaker Patrick Bauer, D-South Bend, said Thursday that at least one
proposal for slots at the tracks would get a hearing before the House Public
Policy Committee. He did not guarantee that a committee vote to advance such
a plan would be made, but the issue is clearly in play now. Indiana's two
pari-mutuel tracks have struggled financially and their owners have warned
lawmakers that they cannot stay in business much longer without more help.
They say additional revenue from slots would allow them to boost purses,
which would attract better horses and therefore more bettors. The tracks
also would reap millions of dollars in profits, and the state would
potentially take in tens of millions in wagering taxes. "The horse-racing
industry is in deep trouble in this state because both tracks appear to be
going broke, and I think we're open to looking at some way of helping them,"
Bauer said. At least two bills have been filed by House Democrats that would
allow slots at horse racing venues, with one allowing up to 2,500 machines
at each track. The tracks and industry currently share $27 million a year in
subsidies from riverboat gambling revenue to help prop them up. Numerous
attempts to allow slot machines or similar devices at horse tracks and
off-track betting parlors have failed to pass the General Assembly over the
past several years. One proposal passed a Democrat-controlled House in 2004,
but it was killed in the Republican-controlled Senate under the leadership
of then Senate President Pro Tem Robert Garton, R-Columbus. Garton was
generally opposed to expansions of gambling and helped block previous
attempts to allow slots at horse-racing venues, saying they would only make
a few rich people richer. But Garton was defeated in the May primary, and
the GOP-ruled Senate is now led by Sen. David Long of Fort Wayne. Long said
Thursday that he "was not a fan of gambling or expanding it in this state,"
but if a slot bill passed the House, he would let his caucus decide whether
it got a committee hearing and a chance to advance.

Jane Jankowski, press secretary to Republican Gov. Mitch Daniels, noted
Thursday that the governor has often said that he does not favor an
expansion of gambling.

One bill by Rep. Scott Reske, D-Pendleton, would allow up to 2,500 slot
machines at each of the two tracks, as well as jointly owned OTBs in Fort
Wayne and Indianapolis. The licenses would be awarded to the owners of the
tracks.

Louisville, Ky.-based Churchill Downs has been the primary owner of Hoosier
Park, but announced last month that it was selling its remaining interest to
its minority partner, Indiana-based Centaur Inc. Indiana Downs is largely
owned by a group of Indiana investors.

Reske's bill, which is being co-sponsored by Rep. Terri Austin, D-Anderson,
would impose a 32.5 percent state wagering tax on the first $150 million in
annual adjusted gross receipts from the slot machines, and a 37.5 percent
rate on proceeds above that. The tax revenue would be dedicated to full-day
kindergarten and health initiatives, among other things.

Bauer said whatever bill was considered would limit slots to two sites, and
Austin has a separate bill that would only allow slots at the two tracks.
The licenses also would go to the track owners.

Austin's bill would impose a 32 percent state wagering tax and a 5 percent
local wagering tax, with revenue from the latter going to cities and towns
in Madison and Shelby counties where the tracks are located.

Austin estimated that her bill would generate $200 million in annual state
tax revenue, with $150 million going to full-day kindergarten and the rest
divided between other education and economic development initiatives.

Democrats control the House 51-49 and in recent years they generally have
been more receptive to expanding gambling. But there are not clearly defined
partisan lines on the issue.

House Minority Leader Brian Bosma, R-Indianapolis, said one might find 40
opinions on slots at the tracks among the 49 members of his caucus.

"There will be some who believe it's a great thing and an addition to our
state's economy addressing both the ag and racing industries," he said. "You
will find others here that find it too large of an expansion of gaming - and
probably all points in between."