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Nazareth, Pa., United States

Thursday, January 19, 2017

NorCo Council Worries State Will Raid Gambling Fund

Northampton County Council President John Cusick has joined ranks with DA John Morganelli to condemn the Bethlehem Sands Casino over its refusal to pay its host and impact fees.

n September, Pennsylvania's Supreme Court declared that the host fee provision in the casino law violates what is known as the uniformity clause A casino must pay $10 million a year, but if its revenues top $500 million, it must pay two percent. Under Pennsylvania's Constitution, even income tax must be the same for one and all. An attempt.to make people who earn more pay more is unconstitutional. This same principle applies to the casino host fee tax.

The Court stayed its decision until January 26 to give legislators time to fix the situation. Casinos were supposed to make their next payment on January 15, but that date came and went without a legislative fix.

Unlike other casinos, Sands Bethlehem has refused to pledge making the annual $10 million payment of its host fee. Mayor Bob Donchez has said that is the equivalent of 100 police officers. DA John Morganelli has threatened to refuse to prosecute petty crimes like bad checks, but the Sands points to a $1 billion investment in Bethlehem, including the creation of 2,500 jobs, as well as millions of dollars in taxes paid.

This topic came up when the Personnel Committee considered the appointment of Donna Louder, a Lower Saucon Council member, to the county Gaming Board. She will replace David Willard.

Louder was thanked for her willingness to serve, and that's when Cusick took the casino to task. "I don't know why, but they seem to be the lone holdout," he complained. "They are a poor corporate neighbor," agreed Ken Kraft.

But Hayden Phillips, who said he was part of a roundtable discussion with Governor Wolf recently, provided an explanation.

"The sands is trying to protect themselves," he said, noting that the state legislature may divert this money away from local governments and into the state Commonwealth Financing Agency CFA, a nontransparent branch of the state Department of Community and Economic Development. It was established in 2004 to enable the state legislature and governor to hand out money based on connections, as opposed to what is needed.

Case in point. Bethlehem Township's Brodhead Road repaving project. A nearly four mile stretch of local road was chewed to pieces by tractor trailer traffic, but the state agency denied any funding to repave the project. Though Manager Melissa Shafer was successful in securing some funding for this badly needed repaving project from other sources, it is a pittance.

The Pittsburgh Tribune has taken this state agency to task for "the public-be-damned secrecy under which it steadfastly operates." This includes a refusal to publish all information from grant requests, including those that are ultimately denied. But lobbyists no doubt love this gigantic candy machine, as well as state legislators seeking money to hand out at election time.

Phillips warns that the legislative "fix" of the state law might include sending the money to the CFA. By refusing to pay the host fee, Sands is placing pressure on the state legislature to do its job.

"It would be a shame if this were to go into the black hole that is the Commonwealth Financing Authority." said Cusick.

NorCo's Gaming Authority is scheduled to meet on Monday. It could be one of their last meetings.


Anonymous said...

The county gaming authority was a sham anyway. It took money that should have gone to county services and extremely important projects near the casino and doled it out as political favors all over the county. BS just got dealt a losing hand.

It was a great idea for an impact fee but it turned into a political slush fund!

Anonymous said...

The gaming authority IS the CFA on a local level. Freemansburg and Bethlehem Twsp ageeed on projects before they walked through the door and rarely if ever voted differently. The gaming authority refused to acknowledge their lack of understanding of impact and did nothing to try and fairly evaluate impact because it might cost money and restrict their inappropriate spending in favor of spending the funds as the law required. The outlying communities who spent the same amount of time and energy trying to evaluate projects based on impact usually got left out of consideration for no reason than the contiguous knew if they spent it all on themselves, there would be nothing left to give out. They viewed the county with skepticism while, at least initially, ignoring the human service impacts of a casino. It cannot get any worse if it goes to the CFA and President Cusick is not paying attention to a board in his own county if he doesn't realize that. May it Rest In Peace.

Anonymous said...

What munipalities have benefited from gaming in Lehigh and Northampton Counties?

Anonymous said...

6:22am ditto

Glad to see somebody is paying attention to what is really going on.

Anonymous said...

6:39 really? Have you not seen the fleet of new cars in bethlehem township, or the tash mehal that Freemansburg built, or all the new shiny stuff Hellertown and lower saucing have?

Where do you think the money came from ?

The most criminal act was when bethlehem townships Nolan got the authority to help expense the volunteer fire company new ladder truck. Showing zero impact and also breaking the law saying that they respond to fires in bethlehem knowing fulll well that bethlehem won't even let them respond to a school fire in their area

Anonymous said...

Save the impact BS. A small percentage of the $100m distributed in Lehigh Valley actully addresses impact. It has become a budget line item to a few select communities. The sad reality is some municipalities stand a better chance at getting a grant from the CFA than County governmwnt. One would think local control over these funds would be better. Counties should be required to distribute 80% of the local share to municipalities.

Maybe get the politics out of this entire mess. Ensure, but cap a defined benefit to the three Cities innaddition to Hellertown and Fountain Hill based on emergency services need. Current law requires increase in revenue month over month to be distrubuted to the same hands instead of broadening the benefit to other municipalities.

Distribute the remaining local share to NC and LC based on per capita. 20% to each County to fund projects and pay debt service. (Not election cycle tax rebates). Take 60% and distribute to NC and LC communities with funded police departmwnts based on number of uniform officers. Take the last 20% and provide assistance to purchase equipment for volunteer departments.

Gaming is a legalized monopoly so better distribution should be paramount. Funds to combat gaming additction should come from the States share on an as needed basis.

Anonymous said...

I agree totally with 3:53 and 6:22.

If you ever look at the funds doled out and the purpose of such entitlements, it will make you sick. You got a county prison that is falling apart and yet I see very limited amounts going into that need. But Bethlehem Twp. P.D. gets equipment, including interceptor patrol cars, in almost every year.

This is the county's legacy with the money. It seems they can't even get this right!

Anonymous said...

As someone who spends way too much time at the Sands I can tell you that in the last 6 months they have been changing the rules of certain games in their favor, eliminating games they feel are too player-friendly, and cutting back on player comps. Combined with their position on the $10 million fee, it just seems like a macro-level corporate belt tightening. They feel they have a lock on the northern NJ/NYC market and have no reason to stand out or offer something favorable anymore.

Bernie O'Hare said...

Those of you complaining about the Gaming Authority have no idea what you are talking about, have posted inaccuracies, and I have to warn my readers that I question your motives Instead of being citizens interested in good government, it is very possible that some of these comments are from lobbyists who want the CFA running the show. You forget that I cover the Gaming Authority. As far as BT is concerned, the Gaming Authority actually DENIED a grant for a ladder truck precisely bc of impact. It later decided to fund a percentage of the ladder truck precisely bc of impact. As for Freemansburg,it has probably suffered the most adverse impact from the casino,along with Hellertown and Bethlehem. I can guarantee you that the CFA would ensure that both of these municipalities get nothing.

I agree the current gaming law is flawed bc there is no definition of impact. But the solution of taking local control away is clearly a money grab by powerbrokers.

Anonymous said...

No one forgets that your macrush Finnegan is the lifelong president of that authority. He is the ultimate political insider and the noble intent of an impact fee has been bastardized not by the state but greedy local yokels who want money. It would be easy to be angry at Sands if the locals had acted honorably but they saw it a cash cow and raided it for all the nice "stuff" they could get. Meanwhile human services got crumbs.

Bernie O'Hare said...

He is not the President, but the Chair of a nine-member body made up of citizens throughout the county. His name is Finnigan. I would prefer that they decide how the money is distributed over a nontransparent gang governed by lobbyists.

Bernie O'Hare said...

Fix the definition of impact, but keep local control and stay away from lobbyists.

Anonymous said...

If the locals has acted with "honor" you would not have top worry about the state. Your pal and Angle confidant Finney and Stoffa gal pal Collis are in charge so you will defend them at all costs. Problem is you make it sound like without a "state" definition the locals had no choice but to hand it out to all the municipalities for shiny new toys. They could have said let us prop up services like county drug, alcohol and addiction services. No, they went for the loot. The Board is made up of municipal representatives looking out for each other in this cash grab bag. It was flawed for the start.

Sorry, they are to blame for their own greed, not the state. They are as bad as the lobbyists!

Ken Kraft said...

Jay finnigan never took impact fees for his contiguous municipality that where not vetted. Any times they. Asked for no money at all, you are being disingenuous when you anonymously say things that are not true. I sat on this board for years and your view on the president is way off base and I wish your would identify yourself you anonymous coward

Ken Kraft said...

View of the chair... sorry a typo

Bernie O'Hare said...

Ken Kradft happens to be a Democrat while Finnigan is Republican. Their politics differ, but they share a healthy respect for the truth. Good for you, Ken!

Anonymous said...

Setting aside the definition of impact, consider this:

Excluding the $Ms Northampton County gaming board distributes from its share, between 2003 to 2016, a total of $8,926,655 in Monroe County share (Mount Airy) has been awarded as 50 grants benefiting 27 entities in Northampton County via the CFA awards.

During that same period a total of $1,486,647 in impact grants have been awarded to only 4 municipalities in Lehigh County from the Sands local share. No funding is available for community grants.

Given the state created a legalaized monopoly threrby picking winners and losers, how is this gross imbalanced justified?

Time for a better distribution formula.

Anonymous said...

Local share distribution from 2015YE

Bethlehem $52.6M
Allentown $20.6M
Easton. $3.5M

Northampton County $19.7M
NC Grants from Monroe. $8.9M
Lehigh County. $6.7M

Anonymous said...

Wow, so it is true that this Ken Kraft guy is a nasty bully. This is the guy who is going to be the next Director of Admisntration? Good Lord!

Bernie O'Hare said...

He couldn't afford the pay cut.