After years of disagreement, the Ohio Roundtable has filed suit against Governor Kasich and various other state entities challenging the legality of Ohio’s “racinos” and the deal struck earlier this year with casinos on the application of the commercial activities tax.
Racinos were introduced by former Governor Ted Strickland in 2009 as part of his plan to solve budget shortfalls. The legislature went on to include authorization for racinos in the previous budget bill, House Bill 1 (128th General Assembly).
House Bill 277 (129th General Assembly), enacted and signed by Governor Kasich earlier this year, memorializes the administration’s agreement to receive an additional $220 million in license fees over 10 years from the developers of the state’s four casinos in exchange for the state applying the commercial activities tax to wagers minus payouts rather than to wagers only.
Among the claims put forth by gambling opponents were that Governor Kasich and legislators unconstitutionally cut in half the $250 million investment required by casino owners; electronic slots cannot be interpreted as a mere expansion of the Ohio Lottery; and by giving race tracks two-thirds of the commission from slots, the net proceeds are not going to schools as required by the Ohio Constitution.
The suit, filed against the Governor, the Lottery Commission, the Casino Control Commission and the state Tax Commissioner in the Franklin County Common Pleas Court, may slow efforts to open the casinos, two of which are scheduled to open in late spring 2012.