Thursday, January 19, 2017
NorCo Council Worries State Will Raid Gambling Fund
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.