Fearing financial devastation, Chester and Bensalem press state for casino tax fix

Gamblers play poker at Harrah's in Chester City

Gamblers play poker at Harrah's in Chester City

Bensalem and Chester City, Pennsylvania, stand to lose millions in casino revenues if lawmakers in Harrisburg don’t fix part of the state’s gambling code.

With time in the last legislative session of the year ticking down, municipal officials are lobbying hard in the Capitol.

Chester Mayor and state Rep. Thaddeus Kirkland, along with Chester’s CFO and controller, met with legislators on Wednesday to push for a quick fix.

“We will be meeting with the leadership, [House Speaker Mike Turzai, House Majority Leader Dave Reed, and House Minority Leader Frank Dermody] and others to talk about the importance of tweaking the legislation such that it doesn’t effect the City of Chester in a negative way,” he said.

Last month, the Pennsylvania Supreme Court ruled the way the state has been taxing casinos is unconstitutional — and gave lawmakers 120 days to change the law. Communities that are home to casinos across the state had been receiving $10 million or 2 percent of slot revenues annually.

Philadelphia’s SugarHouse Casino and boutique casinos, including one in Valley Forge, are exempt.

Without the funds, Bensalem’s mayor said last month the township would have to cut its public safety budget.

As for Chester, Kirkland said, it can’t do without the $10 million — about 25 percent of its budget — it receives annually in slot revenue from Harrah’s casino. Under Pennsylvania’s Financially Distressed Municipalities Act (Act 47), Chester faces a state takeover if it can’t get out of the red in short order.

“We have made a commitment to exit Act 47 by 2018,” said Kirkland. “If the laws are not corrected, that would prohibit us from doing so.”

State Rep. Gene DiGirolamo of Bensalem said he and other local representatives are hoping to resolve the shortfall quickly — and separately from other gaming legislation currently on the table.

“I think we need to run a clean bill and nothing that will complicate things, because that’s really what will slow us down and take time,” said DiGirolamo, R-Bucks.

However, lawmakers representing areas without casinos have a different idea. With the rules for carving up casino revenue up for debate, more districts are angling for a piece of gambling revenues.

“The circumstances and districts have changed since the original law was crafted in 2004,” said Steve Miskin, spokesman for Turzai and Reed. “A number of members and a number of regions are looking at this as an opportunity regarding the local share to see what else can be done.”

Miskin said the House is looking at closing the shortfall for Chester, Bensalem and other areas in conjunction with a budgetary bill that would “fix the budget hole and fix what the Supreme Court did to the local share” of casino revenues.

This week is the last scheduled session for 2016, so the window to shore up finances for Bensalem and Chester is rapidly closing. Several Harrisburg insiders said off the record they did not expect a resolution before the court’s deadline.

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