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Local towns seek cut of casino revenues
PARIS — If money does indeed begin to flow from the planned Oxford casino into governmental coffers, local towns should get a piece of the action, Town Manager Phil Tarr told the Board of Selectmen on Monday.
The board voted to move forward with an initiative to ask for a share of the casino's revenues in the form of an "impact fund," which would offset anticipated municipal costs.
"This is a political battle, is what it boils down to," said Chair Ray Glover.
Currently, 46 percent of the casino's slot revenues, and 16 percent of the casino's table game revenues are earmarked for various entities, including 25 percent to the state Department of Education, 2 percent to the town of Oxford, 1 percent to Oxford County, and 4 percent to the tribal governments of the Penobscot Nation and Passamaquoddy Tribe.
However, that allocation is not yet law.
"The legislature has the authority to change the referendum," said Tarr. "If ever there is going to be an opportunity to offset some of the impact that really has yet to be defined, now would be the time."
Tarr said that Paris and other local towns, including Poland, Norway, and Mechanic Falls, would see additional costs as a result of the casino's presence.
"We believe, between our fire, police, myself and our counterparts in other towns ... that there's going to be some impact," said Tarr. "I can't tell you, and I don't think anyone can tell you exactly what the impact will be, but there's going to be some."
Tarr said that he had spoken to town managers in the area, and that all had agreed to ask their respective boards of selectmen whether they would like to move forward with the initiative.
"I think it's worth our effort, and it's worth the effort of the other communities to join together and ask the legislature to set aside an impact fund that would benefit the towns that are impacted by it," said Tarr.
Costs versus benefits
"Here we are in the middle of this whole operation, with increased traffic coming from not only the south but, you know, a fair amount will come from Vermont, New Hampshire, and from Canada," said Tarr. "So I would like us to be prepared."
Selectman Lloyd Herrick said that he supported the measure, but also said that the towns will see financial benefits from the introduction of the casino to the area.
"We have the potential also to benefit by that. With the impact is a potential benefit for the tax base, or future possible housing, or filling rents or whatever," said Herrick.
"I personally think that the impact on the town of Paris is going to be negligible," said Selectman Ted Kurtz, who also said that he supported the measure.
Oxford Town Manager Michael Chammings has said that other towns in the area will benefit from the casino's presence.
Tarr says that he's not so sure.
"We've heard that our benefit will come because Oxford's tax rate will increase, therefore we're going to have a lower contribution to schools," said Tarr.
However, Tarr points to a new Oxford initiative that could wipe out much of those benefits.
"There's also Tax Increment Financing District (TIF) that could wipe all of that out. I'm not suggesting that Oxford is doing that, but Oxford is researching extending a sewer line up Route 26, You re talking about millions of dollars."
Chammings concedes that properties in a TIF district can reduce a town's share to the school district budget.
However, he says that the impact is limited.
"They're [those properties] exempted from the total value of the town, but that doesn't have any downward motion because the town's original value remains," said Chammings.
"You're also looking at a million dollars going directly to the county, which would allow them [surrounding towns] to have tax relief from their commitment to the county also," said Chammings.
"Could they [Paris] have a higher tax benefit if the building was not TIFed?" asked Chammings. "They could, but that is up to the individual towns that do these TIFs."
Chammings said that bringing water and sewer access to valuable commercial properties on Route 26 could increase Oxford's growth, which would shift the school tax burden back to Oxford.
"My advice to the other town is, you know, attract your own businesses and grow your own tax base and pick up some of our tax share," chuckled Chammings.
Battling for bucks
"That's going to be subject to a very intense political infighting in Augusta," predicted Kurtz.
Tarr, who has served on the state's Racing Commission for several years, says that the process is not unprecedented.
"I don't want us to have missed this opportunity, and then find out later on that we're not going to get the benefit that we thought we were going to get," said Tarr.
Tarr said that area towns would approach the Oxford Delegation of the state legislature to make a formal request, and then the delegation would make a request to the state's legal affairs committee hearing. "Then it would be up to the committee to debate it, and vote it up or down." said Tarr.
The source of the revenue that the towns are seeking is likely to be a source of controversy. The board agreed that it would only target funds that are already being taken from the casino, which means that it would have to come from some other entity that is currently slated to receive those dollars.
"The Town of Oxford receives 2 percent of the gross amount bet as being the host town, but then we have tribal units in the state that receive 4 percent for basically doing nothing," said Tarr.
Members of the state's Gambling Control Board have also acknowledged that they will have to fight for the 3 percent of the casino's slot machine revenues that are provided for in the legislation.
Kurtz said that the Oxford casino referendum was likely to lead to legal gambling throughout the state.
"There's going to be a terrific fight up there in the legislature, because the whole rest of the state is not going to let Oxford County get away with this hundred mile restriction," said Kurtz. "Lewiston is already approved, they're going to be in there fighting. Bangor is mad as hell. Down in Biddeford, they want a racino, so gambling is coming to the state of Maine, and it's not going to be located in Oxford Hills exclusively. That's a pipe dream."
Kurtz said that he supported the plan, because he did not see it as taking money from taxpayers.
"I'm not the least bit bashful about asking for this, because, as I say, let's go pluck the turkey here, but we're not plucking the taxpayers of the state of Maine," said Kurtz. "Let's get as big a piece of the pie of the revenue from the casino as we can for the good old town of Paris."
The board voted to approve the initiative, with four voting in favor, and Selectwoman Jean Smart abstaining.