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Issue 3: Is it a good deal?

October 29th, 2009

On Nov. 3, the state of Ohio will be voting to amend its constitution, where one of the hottest topics will be Issue 3. For those of you who are not aware, Issue 3 is a plan that will create four new casinos, which will be in the four largest cities in the state (Cleveland, Cincinnati, Columbus and Toledo).

Issue 3 will also produce tens of thousands of jobs, and hundreds of millions of dollars in tax revenue for the state of Ohio. Billions of dollars leave the state every year as Ohioans leave to gamble in surrounding states, which have already legalized gambling. The overlying plan of Issue 3 is to keep “Ohio’s money in Ohio,” yet there are formidable parties and strong arguments that are both for and against. 

The “Official Argument and Explanation For Issue 3,” from the state of Ohio’s Web site, outlines all the reasons Issue 3 is a good deal. According to the official argument, by voting “yes” on Issue 3, you will:

• Create first-class casinos in Cleveland, Columbus, Cincinnati and Toledo.

• Create 34,000 new Ohio jobs.

• Produce $11 billion in economic impact over 5 years.

• Generate $651 million a year in tax revenue.

• Provide $200 million for state job training programs.

• Mandate at least $1 billion in new private investment to be spent on casino new casino facilities.

The “Official Argument and Explanation Against Issue 3” states that Issue 3 is a bad deal for Ohioans because:

• Casinos pay only a 33 percent tax rate, keeping 67 percent for themselves.

• Bans other casino gambling, such as “casino nights” at churches or other organizations.

• It imposes a hidden tax by failing to limit how much taxpayers must spend to upgrade infrastructure if a casino is built.

• Allows casinos to be open 24 hours a day, seven days a week.

It is not as simple as reading these facts and formulating an opinion. According to Dan Gilbert, owner of the Cleveland Cavaliers, an independent study supports that 34,000 jobs will be created state-wide. Of the 34,000 jobs, 19,000 will be created through construction projects and 15,000 will be permanent positions. Those against Issue 3 argue that many of the jobs will not be given to those in Ohio, but rather licensed employees from other states.

This seems like a radical idea but, even if it were true, these employees would have to relocate to Ohio permanently in order to work. I do not picture people from Las Vegas or other states flying in on a daily basis to work their shift. Worst case scenario, if out of state employees were hired they would be moving here, paying income taxes here, and spending their income in Ohio. 

Secondly, people argue that the tax rate is much too low. Casinos in New York and Pennsylvania have tax rates over 50 percent and feel a rate of only 33 percent puts too much money back in the hands of the operators and not the state. The money from tax revenues ($651 million annually) is dedicated to all 88 counties. The majority of revenues will benefit the struggling public school systems of Ohio, more specifically city schools where these casinos will be located. So take your pick–should we be greedy and expect more from the casinos, or be willing to accept the current infusion of $651 million?

The official argument for Issue 3 and Gilbert insist the casinos will spark revitalization in the downtown centers of Ohio’s four largest cities. Gilbert projects that an entire casino complex located in downtown Cleveland will bring an additional 8 million people annually. The casino complex will include new retail shops and restaurants, which according to Gilbert “is a catalyst for growth.” 

But there are several large parties who oppose economic growth in Ohio. There are rumors floating around that the majority of the sponsorship against Issue 3 is coming from parties which operate casinos out of state. The Mountaineer, a casino in West Virginia, has been said to be heavily contributing to the fight against Issue 3. It is conveniently located in the panhandle of WV, just minutes from the Ohio border. Clearly, out of state operators have their own interests in mind as they would lose millions of dollars in revenue from the development of casinos in Ohio.

At a time when Ohio’s economy is still struggling and unemployment is around ten percent, nontraditional ideas to aid in the recovery must be considered. Issue 3 could be an enormous lift for the state. There are definitely some detractors to this amendment and, while it is not perfect, it appears the state of Ohio would almost certainly benefit from the passing of Issue 3.

On Nov. 3, find your way to the polls if you want a say in Ohio’s constitution!