Michael Wickline of the Arkansas Democrat-Gazette reports today on a state revision in financial estimates to support Gov. Asa Hutchinson’s plan to raid casino tax revenue to help pay for his highway construction plan, along with increases in sales taxes. To cut through the statistical clutter: This is a permanent and significant raid on general revenues for highways.
Here’s how it goes:
* Through the fiscal year that ended June 30, the tax on existing casinos at Oaklawn and Southland produced $64.3 million for general revenues (schools, public safety, prisons, social services.)
* The casino expansion amendment adopted in November dramatically cut the state tax on casino gambling. That’s expected to cut general revenue by $36 million a year this year and next year on existing gambling. That’s money lost to schools, prisons, public safety
* Sometime in 2021, a new casino is expected to begin operating in Pine Bluff. Oaklawn and Southland plan casino expansions. So, the state thinks gambling taxes will increase. No doubt. But remember: The state tax rate is much lower.
* According to adjusted figures, it will take until the fiscal year ending June 30,
* Meanwhile, the governor is promising $35 million a year in casino revenue for highways. It might be a while before the casino tax hits that level and he’s prepared to make up the shortfall with the surplus he maintains rather than spending it on schools, public safety, prisons or social services.
* Bottom line: Casino gambling that had been producing $62 million a year for schools, public safety, prisons
Like it or not, the disingenuously promoted “Driving Arkansas Forward” casino campaign, pitched as a source of money for roads when the amendment did NOT dedicate the tax for that purpose, WILL be a source of money for roads. But it will be to the detriment of every other state service.
Other components of the governor’s plan to fatten pockets of the highway construction lobby