Owners of Hollywood Casino, claim Kansas Legislature proposals playing a part in a decision to pay penalty rather than start construction on hotel. The penalty amounts to $1.25 million each year. This will be payed to Kansas City, Kansas and Wyandotte County. The 248 room hotel was to start construction this week.
Penn National Gaming and Kansas Entertainment, owners of Hollywood Casino, say two measures in front of the Legislature effects the beginning of the construction. One of the proposals would change how casinos get taxed. There is also a bill planned to help Woodlands Race Track with reopening, with the amount of at least 2,800 slot machines. Woodlands Race Track would have a substantial tax advantage, compared to the Hollywood Casino with this legislation.
A part of the deal with Kansas City, Kansas and the United Government of Wyandotte County, one percent of revenues made annually by the casino, is the penalty that must be paid until the start of construction. Based on the revenues from February last year through February this year, the penalty will be approximately $1.4 million this time.
Senate Federal and State Affairs Committee chairman, Sen. Ralph Ostmeyer, says Penn National's reasoning is just an excuse. The reason being, gambling makeup to the state currently, is not going to change anytime soon.
Last month a hearing was conducted by Ostmeyer's committee, about a bill allowing an amount of up to 2,800slot machines at Woodlands and the state's racetracks. Action was not taken on that bill. Sen. Ostmeyer had voted on a bill in 2007, against casino gambling being legalized. Supporters for the racetracks will have to have Gov. Sam Brownback's approval for gambling expansion. Sen. Ostmeyer says that is not likely to happen.
Wichita Republican, Rep. Steve Brunk, a chairman for the House Federal and State Affairs Committee, states that he will refuse holding any hearing on these two bills, allowing the racetracks to add slot machines.
Mike Taylor, a spokesman for United Government stated, that there is a bigger benefit financially in the short term, with obtaining the penalty money. He also states, having the hotel built is what would rather be seen in long run.
