In a little noticed move this week, the Kasich administration rolled out their revised rules for video lottery terminals (slots) at racetracks. The changes, approved by a vote of the Lottery Commission on Monday, include some major departures from the Strickland administration, who originally drafted — then shelved — the plan. Conveniently, the Strickland plan was put on hold by a citizen referendum — Let Ohio Vote — which was led by the husband of Governor Kasich’s chief of staff, necessitating a budget fix that put an income tax cut on hold. Hmmmm…coincidence? but I digress.

Here are some policy changes the Kasich team is implementing:

  • Lower the tax rate paid to the state by VLT operators from 50% to 33.5%
  • Eliminate goal of hiring mostly Ohio companies for capital improvements, goods & services related to VLT operations
  • Similarly eliminate a very modest goal of using 5% minority-owned businesses for VLT operations
  • Eliminate goal of hiring & training local residents, rather than bringing in staff from out of state
  • Eliminate restriction that patrons must be 21 to enter the VLT area

In other words, in exchange for Kasich cutting racetracks a huge break by decreasing the tax rate they pay for the privilege of operating state-authorized slot machines, the administration has made additional concessions to the tracks: namely, that they no longer have to meet any local or minority hiring goals. Clearly, I didn’t attend the John Kasich school of deal negotiations, but my sense is normally that if you GIVE UP something huge (like a tax break) in negotiations, you should try to GET something in exchange (like say, jobs for Ohioans that you like to claim your are laser-focused on creating). Instead Team Kasich chose to give yet more concessions to the tracks. For the record, the racetracks had agreed to these minority and local hiring goals back in 2009, when they were adopted by the Strickland administration, so this change was not necessary to get them on board. It just shows that Kasich and his crew are either terrible negotiators, or really don’t want Ohioans to get jobs.

The other major news in this announcement is the elimination of the 21-year-old age requirement for entry into the slots parlors. Anyone who was around in 2009 will remember that when Strickland initially set the age limit at 18 (the legal age to play the Lottery), there was quite a fuss made by Republican legislators and newspapers around the state. It’ll be interesting to see what legislators and editorial board have to say about this reversal.

File this one under “John Kasich: terrible negotiator”. (Hey, Eric? We might have to buy more storage space for that file.)

 

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