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See the increase, but beware of raising the stakes

August 7, 2012 - Rob Weaver
It’s ironic that one of the biggest boosts to Seneca County coffers this year is from gambling.

The county’s initial quarterly share from the state’s tax on casino’s gross revenues was slightly more than $49,000, received this month. The next payment is expected in October, before a casino opens in Columbus. But the casinos in Toledo and Cleveland will have been open the entire quarter by then, so the county should get a bigger check.

Last October, the County Commissioners Association of Ohio estimated each county’s take from the gross revenue tax. For our county, that prediction amounted to about $206,000 this year and $756,000 in 2013.

Ohio Casino Control Commission announced Tuesday betting in the Cleveland and Toledo casinos had dropped from June to July; revenues fell nearly 7 percent from about $46 million to about $43 million. That’s not surprising. The same thing tends to happen at restaurants, bars and other entertainment venues. People flock to see the new attraction, then business dips after the newness wears off. Just don’t bank on those revenues before they’re bet.

The county budget commission also raised its estimate for county sales tax revenue this year, by $550,000. The hazard for county commissioners when budgeting the anticipated increase is planning for greater sales tax receipts -- and expecting $756,000 annually from the casino tax -- on a continuing basis would be a gamble.

It would be tempting to allocate part of the expected revenue increase for raises for county employees, especially those who have been subject to a wage freeze. But a downturn in the economy could reduce sales tax receipts and casino tax revenue. And it’s looking more and more like any attempt to trim the federal budget deficit would send ripples throughout the national economy. Just consider the outright fear a looming $110 billion budget sequester is striking in Washington.

A possible compromise for commissioners in allocating some of the extra revenue for county workers might be to dole out one-time bonuses, reviewed annually, instead of ongoing raises. That way, neither the board nor the employees would be taking a chance that the economy won’t begin to recede again soon.

 
 

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