By David Anderson
Anticipating council action to put a measure on the ballot to raise taxes, a reason to vote no.
The casinos in Lakewood can’t afford more taxes but the citizens can?
When Lakewood City Manager Andrew Neiditz (he’s since moved on) proposed increasing taxes on Lakewood’s residents late last year — specifically for electricity and gas utilities — in order to generate an additional $350,000 annually to help balance the 2013-14 budget, Councilman Mike Brandstetter suggested the shortfall be made up by increasing the city’s gambling tax.
“But his colleagues said they can’t count on increased revenue from minicasinos in Lakewood that pay the tax because they are in fierce competition with Indian casinos for business.”
We’ll get back to that in a moment.
In that same Tacoma News Tribune November 24, 2012 article it appeared initially that the council legitimately was concerned that raising taxes in hard times was neither a representative nor compassionate action.
Mayor Doug Richardson (he’s also moved on) said back in November, “People have to heat their homes and cook their food. Given the current economic times, we didn’t think it was wise to increase that tax.”
That being said, there was another reason noted in that article as to why council members decided to forego an increase: “They don’t want to aggravate Lakewood voters before asking them next year to raise property taxes to pay for road work and street maintenance.”
“Next year” is this year and compassion was then and this property tax increase for roads is likely to be heading our way soon.
Now, what chance is there that the council will hit up the casinos for a road-work-and-street-
Why not? Because, to review, “the mini-casinos can’t be counted on.”
But you can.
The casinos “are in fierce competition.”
But you’re not.
Are you as a citizen and taxpayer in Lakewood “in fierce competition” say, with life – to put gas in your car, food on your table, clothes on your kids, skimp on whatever else you can think of in the way of life’s most basic necessities in order to keep a roof over your head, shoes on your feet (those without holes in them to keep the infernal rain out)?
But gambling gets a pass in this budget cycle with additional tax burdens instead placed on you?
Because it’s a gamble to bet on the gambling industry as they “can’t be counted on” per your elected representatives?
Here’s what casino representatives — which representatives include the Lakewood Chamber and the Lakewood City Council, as evidenced in the latter case by Brandstetter’s “colleagues” in the statement above and quotes below — have always said and will forever say when such tax increase proposals pressure the so-called ‘fragile’ gambling business.
Keep in mind when reading the following that the Lakewood Chamber’s Vice Chair of the 2007-2008 Executive Committee, as then listed on the Chamber’s website, was Greg Bakamis, former general manager for Lakewood’s Great American Casino, following which he became Regional Director for the Grand Central Casinos. Serving with Bakamis on the Chamber at that time – on its Board of Directors — was then City Councilman Walter Neary.
· “The Lakewood Chamber of Commerce supports it (dropping tax rate on mini-casinos to 11 percent from previous sliding-scale of 11 to 20 percent) – its directors said in a letter to the council that the sliding tax was unfair and singled out one industry” – TNT, 3/14/07.
· “(Bakamis) told the City Council (3/12/07) that a sliding scale tax makes his business more hesitant to donate to charities and other community causes because it doesn’t know for sure how much discretionary income it will have” – TNT, 3/14/07.
· Neiditz “proposed eliminating the sliding scale gambling tax and replacing it with a flat tax of 11 percent to make it easier to administer and to predict revenues” – TNT, 3/14/07.
· Evergreen Entertainment, which is a part of Lakewood’s Great American/Grand Central Casino according to casino spokesman Greg Bakamis, contributed $250 to Pad Finnigan, Helen McGovern, and Doug Richardson for each of their successful 2005 election campaigns – TNT, October 3, 2007.
· GAC contributed $200 to incumbent City Councilman Walter Neary’s re-election campaign for 2007 according to the state Public Disclosure Commission – TNT, 10/3/07.
Has the council-chamber-casino relationship changed since the 2005-2007 era when these statements were made? Does the current 2013 version “can’t be counted on” and “fierce competition” hearken back to a familiar refrain?
All the hand-wringing might be handkerchief-worthy were it not for the apparent on-going hand-holding behind the scenes.
But as if that were not bad enough, black-jack brokers and other bet-takers boast big bucks in their books that boldly belie this barely-getting-by alibi.
And we’’re not talking bingo.
The following numbers were pulled from the City website:
Year Gambling total revenue Gambling Tax Projected
1996 $11,671,059 $570,892
1997 $17,162,812 $716,342
1998 $18,668,569 $668,076
1999 $21,104,898 $1,483,775
2000 $23,851,680 $1,897,606
2001 $23,536,644 $1,660,036
2002 $22,389,103 $1,607,674
2003 $24,513,631 $1,745,066
2004 $25,345,751 $2,216,114
2005 $25,918,245 $2,353,880
2006 $27,258,777 $2,277,082
2007 $13,304,506 $1,381,011*
? As of the City’s October 3, 2007 report, the gambling tax collection estimate was $2,355,000.
Three observations from these numbers.
First, with the exception of but two successive years, Lakewood’s gambling industry –throughout its entire history, together with its partner the city — has increased revenue.
Second, follow the money and those eager to take it. Upon the opening of the Grand Central Casino in Lakewood, then-Lakewood City Councilwoman Helen McGovern remarked (TNT, July 22, 2003), “It’s a legally licensed business in the state of Washington. I don’t mind where the location is. I’m not a person who believes you can legislate morality. We do get a nice chunk of change from them.”
OK, so go collect it.
Third, it’s your citizens-of-Lakewood money that’s reflected in those numbers. You’ve already gambled away what discretionary money you had. Case in point:
When Bakamis spoke March 20, 2003 at Lakewood United regarding the then-upcoming summer opening of the newest Grand Central Casino (GCC) at Highway 512 and South Tacoma Way in Lakewood, he was asked if he hoped the newest GCC might become a destination casino – that is people arriving from elsewhere as opposed to local patrons.
This is how he answered:
“I would love to be a destination casino. But it’s not likely. Our clientele will be local citizens for the most part.”
That would be you.
To summarize, there is no way, none, that you should be willing to pay more to pave-over the potholes of this city when in affect you’ve already contributed to, and been run-over by, a predatory industry with which Lakewood leadership has partnered since the beginning. No doubt your home finance numbers don’t add up but they most certainly do for the casinos just down the road which you travel over and are asked to underwrite.
Don’t buy the casino alibi. They’ve got the money. Your money. Let the council know you’ll be voting no when they present the Property Tax proposal.
Post-script – a necessary clarification that should be unnecessary given it is “council consensus to send taxing issues to voters.”
Though councilmembers said they would ensure you have your rightful opportunity to vote on tax increases, nevertheless there is a Plan B/End Run/Council Body Right maneuver that by-passes the people. It’s called a Transportation Benefit District (TBD) that allows the council to impose a $20 fee on vehicle licensing that does not have to be voted on by the people and is not subject to referendum by the people.
They can just take it and you can do nothing about it, like it or not.
Anything above $20 does require a public vote.
Though the “council consensus is to send taxing issues to the voters” it doesn’t mean it will. Especially if you vote no.
You might want to poll the new council candidates for their position on this matter. They are:
John Simpson, Don Daniels, Bryan Thomas and Ria Johnson.
Mary Moss, Mike Brandstetter and Jason Whalen (Positions 1, 2 and 3 respectively) are running unopposed. Simpson, Daniels, Thomas and Johnson will face one-another in the August 6th Primary (18-day mail-in-only voting begins July 19) with the top two vote recipients moving on to the November General Election.
The source of “council consensus to send taxing issues to the voters” was originally found on the City website, agenda packet for Jan.22, 2013, p.36. However that link is either no longer live and/or the archieve could not be located.
Jeff Brewster says
David – I am not aware of any council plans to put any tax increase on the ballot this year for road improvements or anything else, though they certainly have that prerogative. Secondly, one thing you need to consider with regard to raising taxes on a commercial enterprise – whether you like them or not – is the point of diminishing returns. When governments overtax a business, they run the danger of losing revenue or compelling the business to close or relocate (that’s right out of Econ 101). While I’m sure you would not have any heartburn with the latter two outcomes, there is no groundswell of support for taxing any of Lakewood’s businesses out of town.
In any event, if the City gets to the point that it wants Lakewood voters to consider paying more taxes to maintain their roads, the merits of that decision should be weighed independently of whatever is going on with mini-casinos. Even if increasing gambling taxes would generate more funds, it would not be nearly enough to properly maintain our roads.
Now, if I can end on a more positive note, I think your other letter asking why the State would want to commit untold millions to a new Amtrak route when its I-5 bridges along I-5 are falling into rivers is an excellent point. Hopefully our state and federal policy makers can rethink that expenditure.
David Anderson says
Thank you for the positive with regards the troubled bridge(s) falling down. As you say, “hopefully our state and federal policy makers can” not only “rethink that expenditure” but draw the same conclusion.
As to your contention that the council may not be planning on a tax increase for the ballot this year, presumably by that you mean that the council is not planning instead to by-pass the people with a license tab increase in lieu of a ballot measure which, as I wrote, they not only promised on a link no longer available on the city website but per the TNT article from late last November – also cited and linked in the article.
Overtaxing a business is not, again from what I wrote, what concerned the council — that is provided they were quoted accurately by the TNT reporter. Rather the council, sans Brandstetter, declared the gambling industry could not bear to be taxed further because they, by inference, were barely getting by.
Two points, as anyone straight out of a 101 Economic class would testify (or for that matter those who actually read what I wrote):
(1) the revenue generated by the casinos does not support – but rather exceeds, considerably – the council’s contention;
(2) the citizens can hardly be better off now – “cooking food, heating homes” – than when former Mayor Doug Richardson made that handkerchiefed remark back in November.
In other words, despite you having exacerbated what I wrote, this is not about “overtaxing” a business to the point that it closes its doors, this is about honesty, and taxation with representation which the council promised — likely to your chagrin since it was in the news and on the city website — its due diligence to perform.