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5:28 pm
Mon January 27, 2014

The Sidebar: Latest N.H. Casino Bill Builds On Failed 2013 Legislation

Credit JV via Flickr CC

Update: The Senate Ways & Means Committee approved SB 366, 4-1, this morning. Sen. Bob Odell, R-Lempster, was the lone vote in opposition to the bill, which would license two casinos. Senate President Chuck Morse said the legislation will now move to the full Senate. Morse said the Senate will likely table it and wait for the House to act on its own gambling bill. That legislation, drafted by members of the Gaming Regulatory Oversight Authorityenvisions a single casino, which Gov. Maggie Hassan supports.

The debate over casino gambling restarts in Concord Tuesday. 

The Senate Ways and Means Committee will hold a public hearing on SB 366 at 9:30 a.m. The bill is the latest effort by Sen. Lou D’Allesandro, D-Manchester, to bring slot machines and table games to New Hampshire.

Last year, the Senate passed a version of the bill, which had strong backing from Gov. Maggie Hassan. But it was rejected by the House.

The new bill, co-sponsored by Andrew Hosmer, D-Laconia, proposes 5,000 slot machines, as did last year's bill, but increases the number of table games from 150 to  240.

The big difference, though, is that SB 366 envisions two casinos at least 30 miles apart – one with 3,500 video slot machines and 160 table games; another with 1,500 video terminals and 80 table games. It would also require operators to provide space for charitable gaming.

There are other differences between the 2013 and 2014 bills, some of which attempt to accommodate critics of previous legislation.

Here’s a quick look:

Oversight

Last year, D’Allesandro proposed creating a gaming enforcement unit in the division of state police, while allowing the lottery commission to license and regulate slots and table games.

SB 366 again gives state police an enforcement role, but it proposes a new regulatory system, based on recommendations by the New Hampshire Regulatory Oversight Authority. Under that system, a gaming commission would oversee all gambling in the state, with separate divisions in charge of the lottery, casinos, and racing and charitable gaming.

Licensing and Application

The 2013 legislation called for a $500,000 non-refundable application fee from each casino bidder and an $80 million license fee from the chosen operator.

This year, the license fee for the larger, or Category One, casino would remain the same; the application fee would triple, to $1.5 million. Application fees for the smaller, or Category Two, casino would be $750,000, and the licensing fee would be $40 million.

All applicants would be required to pay $100,000 to cover the cost of a background investigation.

Credit Michael Kappell via Flickr CC

Taxes

Table games would be taxed at 14 percent, the same as last year’s bill.

The tax on slot revenue would be 30 percent, a five percent increase over the 2013 legislation.

SB 366 estimates more than $456 million in slot revenue and $192.7 million from table games in 2018, the first full year of operation. That’s compared to the $449.4 million from slots and $129 million from table games estimated in the 2013 bill.

Distribution of Proceeds

Income from table games would once again go to the state’s school districts.

Last year's bill earmarked 45 percent of slot proceeds for transportation, including $20 million for debt service on bonds issued to pay for the widening of I-93.

The 2014 bill commits the 45 percent - $48.5 million in 2018 – to the state’s 10-year transportation plan, which currently has no funding in place for some $750 million in major projects, including I-93.

Like last year, this year’s bill commits 45 percent to higher education. The difference is $10,000,000 would be set aside specifically for scholarships in STEM studies - science, technology, engineering and math.

As in 2013, 10 percent - about $11 million - will go toward economic development in the North Country. 

The same 3 percent of would go to the town that hosts the casino. Nearby towns would do a bit better under the 2014 bill: 2 percent would go to surrounding municipalities versus one percent in the 2013 legislation. 

And like last year, 1 percent – about $4.7 million - would go to the Department of Health and Human Services to treat problem gaming.

Credit RK via Flickr CC

Other Bills on the Table

This session, Hassan is focused on legislation drafted by the Gaming Regulatory Oversight Authority, said spokesperson Marc Goldberg.  

That bill, which is sponsored by Rep. Richard Ames, D-Jaffrey, Rep. Lucy Weber, D-Walpole and Sen. Jim Rausch, R-Derry, would allow for a single casino with 5,000 slot machines and 150 table games. Table games would be taxed at 18 percent and slots at 35 percent. How the proceeds are distributed would be left to the legislature.

A bill by Rep. Steve Vaillancourt, R-Manchester, would legalize 5,000 slot machines at a half dozen locations in the state. Most of the revenue - 73 percent – would go to the general fund.

A fourth bill, sponsored by Rep. Dan Sullivan, D-Manchester and Rep. Frank Sapareto, R-Derry, would allow as many as 1,500 slot machines at six locations.

Meanwhile, opposition to this year’s casino bills is likely to be every bit as vehement as it was last year.

Two anti-casino groups, Casino Free Hampshire and the Granite State Coalition Against Expanded Gambling, joined forces in December. The move came after former coalition leader Jim Rubens announced he was running for the U.S. Senate.

The group is now led by former Democratic state Sen. Harold Janeway and Republican businessman Steve Duprey. They warn that the New England casino market, which will soon include Massachusetts, is saturated and that the social costs of expanded gambling will exceed the financial gains.