Indiana Racing Could Pay Price in Budget

by James Platz

Indiana Gov. Frank O'Bannon gave his state of the state address Tuesday evening before members of the General Assembly, and the pari-mutuel industry wasn't left out of the equation.

Faced with the prospect of no revenue growth in the current fiscal year, and a budget deficit of $1.3 billion by mid-2003, O'Bannon stressed the importance of "doing the hard things today to ensure a better tomorrow."

One of the "hard things" outlined would be to increase the riverboat casino admissions tax from $3 to $5, coupled with a proposed cigarette tax increase of 50 cents per pack. The plan, which is outlined in House Bill 1004, also calls for revenue paid each year to the horse racing industry to be moved to the state's general fund. The tax increases are projected to raise more than $500 million in revenue.

The alternative to the tax hikes is to cut funding in education. Noting that education comprises 55% of the total budget, O'Bannon told General Assembly members: "In a choice between those taxes and our schools, I will pick Indiana's children every time."

On Jan. 9, O'Bannon testified before the House Ways and Means Committee during a public hearing. It was the second time he had testified on House Bill 1004; the other occasion came two months ago during the first statewide hearing in Evansville.

In the Jan. 16 edition of the Indianapolis Star, House Ways and Means Chairman B. Patrick Bauer of South Bend said the committee would vote on House Bill 1004 within two weeks.

Another bill that could alter the gaming industry in the state is also on the books. Senate Bill 333 would authorize dockside gaming, as well as pull-tab machines (video lottery terminals) at pari-mutuel racetracks and satellite wagering facilities. A similar proposal was rejected last year.

Indiana has one pari-mutuel racetrack -- Hoosier Park -- and another one in works. Indianapolis Downs is scheduled to open in December of this year.