The Lacey City Council Thursday will consider whether to amend its gambling tax rate for social card games, a move designed to aid Hawks Prairie Casino, a non-tribal casino near Interstate 5 and Marvin Road.
The owners of the casino and its landlord, Jim Kerzie, could not be reached Wednesday.
But they met with the city’s general government committee in December and asked that the city’s gambling tax rate on social card games be reduced to 7.5 percent from 10 percent, according to background information provided for Thursday’s meeting.
Here’s more from concil agenda materials:
“According to representatives of the Hawks Prairie Casino, economic and regulatory challenges remain and continue to evolve. Consideration for some form of permanent social card game tax relief is necessary in order for its business model to work. Without reductions in the gambling tax rate or lease payments, owners of the Hawks Prairie Casino stated they would explore other options, potentially even relocating to another community.”
Kerzie has stated his willingness to reduce lease payments on the building.
If the gambling tax and lease rates are reduced, “representatives of the Hawks Prairie Casino indicated they would renew their multi-year lease,” according to the agenda.
But here’s what an amended gambling tax rate would mean for the city.
The current tax rate of 10 percent on gross revenue from the operation of social card games is expected to generate about $450,000 for the city this year.
But if the amended rate is approved, the city recommends it be implemented over time, cutting the rate to 9.17 percent in April, 8.33 percent on Jan. 1, 2015, and then again to 7.5 percent on Jan. 1, 2016.
That schedule would eventually reduce the city’s gambling tax revenue on social card games to $337,500 in 2016 from $450,000 in 2014, according to the agenda.
Arguments for and against doing this include saving casino jobs, but it also would mean less revenue for the city to pay for “essential services,” according to the agenda.
Lacey City Council meets at 7 p.m. Thursday, Lacey City Hall, 420 College St. S.E.
Rolf Boone email@example.com 360-754-5403