Senate will face move for slots at Racino

When lawmakers return to St. Paul in February they will find the Racino Bill still on the table in the Senate Taxes Committee.

For supporters of the Racino at Canterbury Park in Shakopee, the idea makes good sense for the financially strapped state and would also boost the horse racing and breeding industry.

The concept allows slot machines at the race track, which already has horse betting and a card club offering poker and other casino games. It would be a state-regulated, privately-financed venue, based on successful models in other states.

The $90 million project would include a casino, an Olympic-scale horse park, hotel and conference center and related improvements to the 367-are site.

The Racino bill passed the House last session, although it did not have the support of Northland legislators. It now has to get through the committee for a full Senate vote, then approval by the governor.

"No one thought we would have gotten as far as we did," said Carin Offerman, on the board of directors of racing at Canterbury Park. "The public is really behind this issue. That's what drove it through the House last year.

"People are kind of mad. They would like to see the state get some revenue from gaming."

She cited three different polls that showed 70 percent of state residents want the Racino, with support at 75 percent in northern Minnesota.

"We've gotten a lot of support from Minnesotans in general," Offerman said. "People just want to see this happen. They want to see the state get a little bit of revenue out of a multi-billion dollar industry."

She said the Racino would be the first gaming and entertainment operation to generate substantial tax revenues for the state. Minnesota would get 40 percent off the top. Another 15 percent would go to the state lottery, which would run the slot machines.

"They will actually place the slot machines at Canterbury Park and operate them," she said.

According to an independent analysis, the Racino could generate at least $150 million in new state tax revenue in two years of full operation. The local governments would get about $4 million in new revenue, and the project would create more than 1,400 new full and part-time jobs.

She acknowledged people do not want to see a spread of gaming to more locations, and since the track and card room already exist, it is not viewed as an expansion of gambling.

"We're already there," she said. "We're three miles from Mystic Lake, the second largest tribal casino in the nation, and we're not going to create any new gamblers. ... We're giving people an option for a new place to go."

"The local government wants it," she said, noting there is really little opposition except from existing casinos. "We have six lobbyists; last year they had 56," she said.

Minnesota has 18 tribal casinos with an estimated 21,000 slot machines. There are about 22 casinos in Wisconsin. Tribes are not required to report gross gambling revenues. Estimates provided by Canterbury Park put Minnesota's total tribal casino betting at about $3 billion each year.

The last official net revenue estimate from the the state of Minnesota was $500 million for 1993, which meant bettors put down about $2.5 billion. Federal law keeps Minnesota and Wisconsin from taxing Indian gambling. However, unlike Minnesota, Wisconsin has found a way to claim a share of the payoff -- about $24 million in 2001 -- while Minnesota got about $160,000 to defray some state expenses. There are also local revenue arrangements.

State Rep. Tom Huntley, DFL-Duluth, doesn't believe the Racino project would have a significant impact on state finances and has other issues.

"It's basically an attack on the Indian tribes," he said. "They're finally making a few bucks -- they want to cut them out of it."

Huntley said that all the money that is spent in gambling and all the money that is spent at professional sports is disposable income, and there is a fixed amount of it. "If you don't spend it there, you spend it someplace," he said. "There's no addition to the economy. It just changes how it's redistributed."

State Sen. Dave Tomassoni, DFL-Chisholm, is vice chair of the Senate Taxes Committee. He said the big problem the Racino will face is that it is a non-budget year, and the main focus will be on the bonding bill. He doesn't know if it can get through the tax committee.

"Racino is an idea that's got a specific spot where it has to go," he said. "Whether or not it actually helps the state has not been established."

Tomassoni said since no one in Minnesota is more than an hour away from a casino, and residents enjoy gambling, slots could be placed anywhere.

He raised the possibility of having the state lottery operate slot machines in local bars. The senator acknowledged there would be objections and issues to settle but concluded it may be the best chance for additional state revenue, outside of raising taxes.