Report: VLTs Considered Option by Michigan Governor
by Tom LaMarra
Date Posted: 10/14/2003 10:43:35 AM
Last Updated: 10/15/2003 10:42:46 AM

Michigan Gov. Jennifer Granholm said a proposal to authorize video lottery terminals at racetracks is one possible way to help balance the state's budget.

According to the Gongwer News Service, which tracks legislative activities, Granholm plans to tour the state to get feedback from residents. She said her main interest is to keep Michigan "a low-tax state."

Gongwer reported that revenues for the last and current fiscal years are more than $800 million below estimates made in March. Currently on the table is a rollback in the state income tax from 4% to 3.9% in an effort to raise hundreds of millions of dollars.

There are several bills still in play that would generate $400 million to $800 million a year in revenue, according to supporters. The House has approved most of the bills.

Under the primary racino measure, net VLT income from all license-holders -- in this case the racetracks -- would be combined. The state treasurer's office would get 40% of the revenue to distribute to education and agriculture programs and to certain cities in Michigan.

Racetracks would get 42.5% of the revenue. The tracks would pay 0.05%, but not more than $1 million, to local government.

An "agricultural enhancement purse pool" would get 15% of VLT revenue, while 2.5% would go toward breeders' awards.

A maximum of 500 machines would be authorized at each track, though approval could be obtained to increase that amount. Michigan has six operating racetracks: Great Lakes Downs, the state's Thoroughbred track; Mt. Pleasant Meadows, a mixed-breed facility; and Hazel Park, Jackson Raceway, Northville Downs, Saginaw Raceway, and Sports Creek Raceway, all of which are Standardbred tracks.

Other bills would authorize off-track betting and permit Detroit's land-based casinos to simulcast races.

The Michigan racing industry has been in a downward spiral for years. Aside from the Detroit casinos, there are Indian casinos in the state, a casino in neighboring Windsor, Ontario, and two racinos on the Ontario border.

All Thoroughbred racing has been held at Great Lakes in western Michigan since 1999, the year after Detroit Race Course closed. Thoroughbred supporters believe racing needs a presence in the Detroit metropolitan area; Magna Entertainment Corp. has proposed a track in the metro area that would offer Thoroughbred and Standardbred racing.

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