June 15, 2011 at 3:21 PM EST - Updated June 24 at 9:49 AM
DOWNTOWN CLEVELAND, OH (WOIO)
Governor John Kasich and Rock Ohio Caesar's Owner Dan Gilbert met to discuss the details of an agreement on the casinos in Cleveland and Cincinnati.
Casino construction came to a halt last month when Kasich said he wanted casinos to pay more taxes.
Here's what we now know following a statement from Governor Kasich's Office:
With gaming having been legalized in Ohio in phases over approximately the past 80 years, Gov. John R. Kasich initiated a comprehensive review to ensure that the state's laws for horse racing, the Ohio Lottery and casino gaming are consistent and uniform, and provide the maximum benefit to Ohioans.
The result is an agreement in principle between the Office of the Governor and Rock Ohio Caesars, LLC (ROC) that would provide significant additional funds to Ohioans, increased regulatory certainty for ROC and additional policies for the Ohio Lottery and horse racing. Highlights include:
· $110 million in additional payments to the state over the next 10 years by ROC;
· ROC would pay Ohio's Commercial Activity Tax on wagers minus payout's, instead of on wagers only;
· $350 million to the state in video lottery terminal (VLT) license fees, plus 33.5 percent of all VLT sales revenue;
Portions of the agreement would require approval by the General Assembly, and in some cases the Casino Control, Lottery and Racing commissions. Portions of the agreement only apply to ROC.
· $110 Million in Additional Payments: ROC would provide an additional $10 million annually for the first five years and $12 million annually for the five years after that;
· CAT: Ohio's Commercial Activity Tax (CAT) would be applied to, what in the gaming industry is referred to as, ROC's "gross," - total dollars wagered minus winnings and prizes to customers;
· Capital Expenditures: ROC would make a combined capital expenditure of at least $900 million in its two casino facilities (Cleveland and Cincinnati), up from the combined $500 million currently required by Article 15 of the Ohio Constitution;
· ROC Site: The two parcels of land on which ROC will build its Cleveland casino would be treated as a single facility for licensing and regulatory purposes;
· License Transfers: Casino license transfers must be approved by the Casino Control Commission and would require a $1.5 million application fee;
· License Renewals: ROC's casino licenses must be renewed every three years for an amount designed to cover the Casino Control Commission's administrative costs.
VIDEO LOTTERY TERMINALS
· $50 million VLT Licenses: The Lottery Commission intends to allow each of Ohio's seven horse racing permit holders to apply for a 10-year sales agent license to operate a VLT facility. Licenses would cost $50 million and be paid over time: $10 million upon application, $15 million at the onset of VLT sales, and $25 million one year later;
· Capital Expenditures: VLT sales agents would be required to invest at least $150 million in their facilities, including VLT machines, with a maximum credit of $25 million allowed for the value of existing facilities and land;
· Sales Agent Commission: The commission for VLT sales agents [the amount of their sales revenue they would be permitted to keep] would not exceed 66.5 percent;
· Opening Date Requirements: VLT sales agents would be required to fully complete their capital spending and open their facilities within three years of license approval;
HORSE RACE TRACKS
· Track Relocations: The state would consider transferring horse racing permits from current track locations to new locations, including locations in the Dayton and Youngstown areas, at a later date;
· Horse Industry Agreements: No VLT sales can commence without VLT licensees reaching an agreement with the horse racing industry on funds to benefit the industry. The state reserves the right to set the details of an agreement if one is not reached by the time VLT sales are set to begin.