Adams County plays it safe in gaming revenue estimates
NATCHEZ — Despite the fact that a new casino opened in December, Adams County has only budgeted for an additional $95,000 in gaming revenue for fiscal year 2013.
For the fiscal year that ended in September 2012, a period in which only one casino — the Isle of Capri — was open, the county received $405,363 in gaming revenue.
But for the current fiscal year, which started two months before the Magnolia Bluffs Casino opened its doors, County Administrator Joe Murray said he has budgeted for the county to receive $500,000 in gaming revenue.
The reason, he said, is caution.
“I was trying to be conservative when we were doing the budget, because there is no way to know what will happen,” Murray said. “The new establishment could come in and it doesn’t work, or the Isle of Capri closes and it washes out, or one takes customers from the other and the business remains the same for both of them.”
The county receives two streams of gaming revenue, one per state statute and one per local legislation that the City of Natchez enacted in 1993 and the county government ratified in 1994.
Under that agreement, the city receives 3.2 percent of all gaming revenues in Natchez for a given month. The city then forwards 30 percent of its gaming receipts to the county, Murray said.
“Every county that has a gaming vessel and most of the cities have local-private legislation to distribute revenues from the city to the county or the county to the city,” Murray said.
The state statute that generates gaming revenue taxes revenue on a progressive rate. The first $50,000 a gaming site grosses will be taxed at 0.4 percent, the next $84,000 are taxed at 0.6 percent and all gross revenue exceeding $134,000 is taxed at 0.8 percent.
Murray said the gaming revenue budget for the year was based in part on last year’s receipts with the knowledge that more would likely come in.
“It is really difficult to determine something like (future gaming receipts),” he said. “You would certainly hope that you come out a little more to the good than you expected, and I would certainly hope from what I budgeted that it doesn’t come in under.”
The county administrator said trying to budget gaming receipts is similar to Vidalia trying to budget based on hydro plant revenues.
“Several months ago, the river was at a record high, and then it was at a record low,” Murray said. “Just like that, gaming is not a static rate. Years ago, during Hurricane Katrina, we had all this influx of people coming from out of area and our gaming revenues shot up. People were in town, they were staying here and spending money and your revenues for gaming were up, but you knew good and well not to budget your next year based on that year.”
Revenues were also difficult to project because the county will only see nine months of revenue from the Magnolia Bluffs Casino in the fiscal year.
“As these months go on and you see how the casinos are going to be able to coincide and exist together, it will give you a better idea what you can hope to expect from them in the next fiscal year,” Murray said.