Proposed casino: a gamble in Ohio?

By MICHAEL SANGIACOMO

A Minnesota-based firm hopes to change Ohio’s mind on gambling in the state.

Lyle Berman is a betting man. He bolstered his casino empire with $1.5 million he won in a high-stakes poker game.

Now he’s wagering that the people of Ohio are ready for their first casino. And he’s sweetened the pot by offering to make all 88 of the state’s counties winners: an annual split of the earnings, about $211 million, to be divided up based on county population.

Berman’s Lakes Entertainment from Minnetonka, Minn., has partnered with MyOhioNow.com in Beachwood to ask voters to approve a referendum to change the Ohio Constitution and allow a $600 million casino and resort between Columbus and Cincinnati.

Is it enough to persuade Ohio voters to approve casino gambling, a proposal that has been voted down three times since 1990?

National experts say no, but Berman has learned from the mistakes made by the other attempts to bring casinos to Ohio. He said the big mistakes were making the proposals too large or too complicated.

Berman’s proposal is for one casino located in Clinton County in rural southern Ohio, a place that needs the projected 5,000 jobs — with an average salary of $38,000, counting benefits — it would create. The lowest-paid job would be $15 an hour.

Berman, who built his family leather shop into a booming leather goods business, said he’s not trying to win over politicians. He’s concentrating on voters by using celebrities such as Jamie Farr, Suzanne Somers, Dwayne Hickman and Vicki Lawrence to pitch the referendum.

Rick Lertzman and his MyOhioNow.com group are the minority partner in the casino venture. He can’t see why Northeast Ohio voters would vote against it.

“People from Cleveland go to Detroit and Windsor every day, about three hours away,” Lertzman said. “So what’s the difference if they drive west or south?”

Timothy Cope, president of Lakes Entertainment Co., explained the tax breakdown for the casino.

Using the three Ohio River riverboat casinos in Indiana— the Argosy, the Grand Victorian and Belterra — for comparison, Cope projected that the Clinton County casino would gross $800 million a year from gambling.

Of that, 30 percent, or about $240 million, would be shared. Clinton County would receive 10 percent of that amount, 1 percent would go to the state for administrative costs and 1 percent would go toward treatment programs for problem gamblers. The remainder, about $211 million, would be divided among the state’s 88 counties —including Clinton County — based on population.

“A person loses $100 at the casino, he can be assured that $30 of that goes right back to the state in some way,” said Cope.

I. Nelson Rose, a law professor at Whittier Law School, Costa Mesa, Calif., who writes a syndicated column on gambling and the law, said the percentages being proposed are similar to a deal in Connecticut where American Indian tribes opened a casino in exchange for 25 percent off the proceeds. The remainder went to local governments.

Ernest Yelton, Indiana Gaming Commission executive director, confirmed that the three Ohio River casinos generated $851 million in “gaming wins” in 2007. Combined, the three casinos gave $257 million in taxes to the state last year.

But both experts agree it may be a moot point because they think the referendum will fail.

“I can tell you already it will not pass,” Rose said. “One-third of the public is dead set against gambling, period, for religious or other reasons. Another one-third is mildly against gambling, and the remaining third just does not care. There is no significant group of people who favor gambling. Because of that, the measure will fail.”

The Ohio Roundtable of Strongsville opposes the casino, as it has every other casino proposal. President Dave Zanotti noted that the referendum says if another casino opens in Ohio, the Clinton County casino would only have to give up a split with the counties equal to what the new casino pays. That could be another American Indian casino, which pays only 2 percent, Zanotti said.

“You see what could happen?” he said. “Counties that planned on that income would not get it.”

Lertzman said that there are “absolutely no plans” to open a second casino in Ohio and that opening an American Indian casino in the state would be almost impossible.

Zanotti said the new casino owners expect a lot of people in Ohio to become big gamblers.

“It’s just common sense,” Zanotti said. “How will they turn that many people into gambling addicts?”

The Ohio Roundtable comes under the nonprofit American Policy Roundtable, whose mission statement states a goal to “restore traditional Judeo-Christian principles to American public policy.”

“The ‘antis’ are already out there,” Berman said. “They’ll say what they always say, that it will mean an increase in drugs, prostitution and crime and that it will hurt local restaurants. But, as we say in Minnesota, ‘That dog don’t hunt.’ People have been to casinos now and they have seen that those claims are just not true.”

A Sacramento firm has been hired to gather the 402,275 signatures necessary to put the referendum on the November ballot, and it anticipates no problems.

Ohio is surrounded by casinos, including Mountaineer Park in West Virginia; Presque Isle Downs Casino in Erie, Pa.; multiple casinos in Detroit and throughout Michigan; Casino Windsor in Windsor, Ontario; Seneca Casino in Buffalo, N.Y.; and others.

Lertzman said casinos — any building with slot machines — are “legal in 38 states and there are efforts pending in five others. That means Ohio will be one of the seven states in the country that does not offer gambling.”