Lincoln Journal Star. November 27, 2022.
Editorial: A month in, casino shows revenue potential
In 2020, proponents of the initiative that would allow casinos at the state’s horseracing tracks made a convincing argument that providing gambling there would keep the cash wagered and the tax dollars it generates in Nebraska rather than seeing it cross the Missouri River to Iowa casinos.
After just a month of operation of one casino, that prediction is bearing out – in millions.
Lincoln’s WarHorse Casino, which opened in late September, generated, according to information released by the Nebraska Racing and Gaming Commission, just more than $854,000 in gaming tax revenue in October.
The state’s gaming tax is 20% of revenue, which means WarHorse made some $4.27 million last month. Assuming a 90% average payout, the industry standard, that means visitors dropped nearly $43 million, or close to $1.4 million a day into the WarHorse slot machines last month.
Across the river in Council Bluffs, the Iowa Racing and Gaming Commission reported that gamblers spent about $320 million in October on slot machines at the Ameristar, Harrah’s and Horseshoe casinos. That’s down from $331 million in September and $339 million in October, 2021.
There are, of course, myriad reasons for why the Council Bluffs gaming revenue declined by more than $10 million over the previous months, especially the notion that inflation has caused many to cut their discretionary spending, and gambling is purely discretionary.
But some, if not most, of that decline has to be attributable to Nebraskans playing the slots at WarHorse rather than driving to Council Bluffs to do so.
The Nebraska gambling numbers are certain to increase in a couple weeks when the Grand Island Resort Casino opens its temporary facility at Fonner Park. And they will jump again in the spring when the WarHorse Casino in Omaha opens its doors.
It remains to be seen how much gambling at the Grand Island and Omaha casinos will reduce the amount of money wagered in Lincoln, as some of those who’ve been coming to WarHorse surely will go to one of the two that are closer to their homes.
But overall, ever more Nebraska money will stay in Nebraska, which, as the Nebraska Racing and Gaming Commission report shows, is a very good thing for Nebraska taxpayers.
To wit, in its first 38 days, WarHorse generated $1.14 million in taxes. Of that, nearly $800,000 – 70% of the total – goes to a fund that will provide relief to the state’s property taxpayers. The city of Lincoln and Lancaster County, which each get 12.5%, have netted nearly $143,000. And the state general fund and compulsive gamblers assistance fund have each received more than $28,000.
Extrapolating that number at the same level of revenue, WarHorse will generate nearly $11 million in tax revenues in its first year.
That’s $11 million that will give property owners some tax relief and go to, say, fill some potholes, or pave county roads, pay for park improvements or other city and county projects. That will be paid entirely by gamblers, not the general taxpayer – another of the arguments in favor of casino gambling that has come to fruition in just a month of gambling at a single casino.