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EEC presentation

  1. 1. STATE OF KANSAS SOUTH CENTRAL GAMING ZONE: FISCAL IMPACT ANALYSIS OF PROPOSED GAMING FACILITIES DECEMBER 2010
  2. 2. Study Purpose • Estimate the financial impact of the proposed gaming facility on State and local governments’ budgets • To determine if the gaming facility will cause a financial surplus or deficit to governments’ budgets • Compare proposer’s estimated public sector revenue and costs to consultant’s estimate
  3. 3. Methodology • 7-Year Fiscal Impact Summary: – Global Gaming-full buildout and 1 year of operations – Peninsula Gaming-full buildout and 3 years of operations • Sources of Data: 1. Developer’s template, Lottery contract, predevelopment agreements 2. Interviews with county, city and school district representatives
  4. 4. • Revenue Estimated: -Gaming Revenue Sharing -Sales Tax -Property Tax -Income Tax -Building Permit Fees -Lodging Tax • Costs Estimated: -Law Enforcement -Fire/EMS -Public Works (Streets, Water, Wastewater, Electric) -Building Inspections -Golf Club* -Administrative Overhead -Education *Global Gaming only. Methodology
  5. 5. Assumptions • Lottery Contracts provide that – Global Gaming proposes to provide funds for the purchase of police/fire equipment and technology – Peninsula Gaming proposes to provide a fund for student reward cards and scholarships – Both proposers have agreed to increase the required gaming contribution to the State based on gaming revenue levels • Global Gaming-1% additional contribution for gaming revenues above $250 million provided no competitive facilities are constructed • Peninsula Gaming-2% additional contribution for gaming revenue between $180 and $220 million and 4% additional contribution for gaming revenues above $220 million
  6. 6. Assumptions • Proposers’ Predevelopment Agreements provide that – Both developers will construct or provide funds to construct adequate infrastructure to service the development, including roadways, utilities, public safety and emergency service facilities • Analysis estimates full operating and capital costs associated with each development and adjusts these costs for the amount of proposed developer contribution
  7. 7. Assumptions • Analysis assumes only Professional, Manager, Executive and Technician positions will be new to the area – Global Gaming-169 employees at buildout – Peninsula Gaming-137 employees at buildout – Remaining positions will be filled by existing area residents • 25,198 unemployed people in the Wichita MSA as of September 2010 • No significant incremental resident-driven costs: – Clerk, Registrar, Courthouse, Unified Court, Counselor, CASA, and Juvenile Court
  8. 8. Assumptions • No significant incremental school costs-existing capacity within area school districts – Between 2000 and 2009 Sumner County school districts experienced a decrease of 1,281 school-aged children – USD 353 (Wellington) has an existing capacity of 1,970 students, 920 in elementary school, 500 in middle school and 550 in high school – USD 263 (Mulvane) has an existing capacity of 273 students, 98 in primary and grade school, 165 in middle school and 10 in high school
  9. 9. Entities Global Gaming Peninsula Gaming State* State* Sumner County Sumner County Sedgwick County* Sedgwick County* City of Wellington City of Mulvane USD 353 USD 263 *Only revenue is estimated
  10. 10. Global Gaming-7 Year Summary REVENUE State Sumner County Sedgwick County City of Wellington USD 353 Property Tax 230,151$ 8,978,508$ -$ 7,663,730$ 9,163,089$ Sales Tax 13,176,743 2,091,546 - 2,614,433 - Gaming Revenue 168,898,997 7,037,458 7,037,458 7,037,458 - Income Tax Revenue 17,822,773 - - - - Building Permit Rev. - - - 193,766 - Lodging Tax Revenue - - - 859,300 - Developer Contrib. - - - 6,253,969 - Total 200,128,664$ 18,107,512$ 7,037,458$ 24,622,657$ 9,163,089$ COSTS State Sumner County Sedgwick County City of Wellington USD 353 Law Enforcement -$ 1,997,764$ -$ 1,581,215$ -$ Fire/EMS - - - 4,818,384 - Public Works - - - 3,051,752 - Other - - - 493,766 - Education - - - - - Admin./Overhead - 475,522 - 894,763 - Total -$ 2,473,285$ -$ 10,839,881$ -$
  11. 11. Global Gaming-Comparison State Sumner County Sedgwick County City of Wellington USD 353 Revenue 200,128,664$ 18,107,512$ 7,037,458$ 18,368,688$ 9,163,089$ Developer's Contr. - - - 6,253,969 - Cost - 2,473,285 - 10,839,881 - Surplus/ (Deficit) 200,128,664$ 15,634,227$ 7,037,458$ 13,782,776$ 9,163,089$ State Sumner County Sedgwick County City of Wellington USD 353 Revenue 170,638,890$ 14,921,708$ 6,929,525$ 13,557,591$ 2,700,000$ Developer's Contr. - - - 5,000,000 - Cost - 1,237,946 - 10,087,971 181,500 Surplus/ (Deficit) 170,638,890$ 13,683,762$ 6,929,525$ 8,469,620$ 2,518,500$ CONSULTANT APPLICANT
  12. 12. Peninsula Gaming-7 Year Summary REVENUE State Sumner County Sedgwick County City of Mulvane USD 263 Property Tax 301,493$ 11,761,657$ -$ 10,788,436$ 11,286,704$ Sales Tax 12,679,005 2,012,540 - - - Gaming Revenue 266,031,211 11,013,577 11,013,577 11,013,577 - Income Tax Revenue 10,281,926 - - - - Building Permit Rev. - - - 326,103 - Lodging Tax Revenue - - - 582,741 - Developer Contrib. - 206,250 - 19,798,000 9,000,000 Total 289,293,635$ 24,994,024$ 11,013,577$ 42,508,857$ 20,286,704$ COSTS State Sumner County Sedgwick County City of Mulvane USD 263 Law Enforcement -$ 2,603,567$ -$ 2,176,045$ -$ Fire/EMS - - - 7,795,417 - Public Works - 666,246 - 17,275,500 - Other - - - 326,103 - Education - - - - - Admin./Overhead - 778,304 - 2,119,603 - Total -$ 4,048,116$ -$ 29,692,668$ -$
  13. 13. Peninsula Gaming-Comparison State Sumner County Sedgwick County City of Mulvane USD 263 Revenue 289,293,635$ 24,787,774$ 11,013,577$ 22,710,857$ 11,286,704$ Developer's Contr. - 206,250 - 19,798,000 9,000,000 Cost - 4,048,116 - 29,692,668 - Surplus/ (Deficit) 289,293,635$ 20,945,908$ 11,013,577$ 12,816,190$ 20,286,704$ State Sumner County Sedgwick County City of Mulvane USD 263 Revenue 262,574,961$ 22,934,451$ 10,337,330$ 24,116,691$ -$ Developer's Contr. - - - 13,438,400 9,000,000 Cost - - - 15,928,691 - Surplus/ (Deficit) 262,574,961$ 22,934,451$ 10,337,330$ 21,626,400$ 9,000,000$ CONSULTANT APPLICANT
  14. 14. Peninsula Gaming-Site A v. B City of Sumner Sedgwick State of REVENUES USD 263 Mulvane County County Kansas Site A 11,286,704$ 22,710,857$ 24,787,774$ 11,013,577$ 289,293,635$ Site B 11,286,704 21,870,032 23,946,949 10,172,752 267,907,222 Difference -$ 840,825$ 840,825$ 840,825$ 21,386,412$ COSTS Site A -$ 29,692,668$ 4,048,116$ -$ -$ Site B - 24,801,245 4,048,116 - - Difference -$ 4,891,423$ -$ -$ -$ 1. Revenue difference is due to a difference in gaming revenue generated by each site as estimated by Wells and Cummings. 2. Cost difference is due to the difference in Water, Wastewater, and Electric department costs and resulting Administrative Overhead estimates.
  15. 15. Applicant Comparison State Sumner County Sedgwick County City of Wellington USD 353 Revenue 200,128,664$ 18,107,512$ 7,037,458$ 18,368,688$ 9,163,089$ Developer's Contr. - - - 6,253,969 - Cost - 2,473,285 - 10,839,881 - Surplus/ (Deficit) 200,128,664$ 15,634,227$ 7,037,458$ 13,782,776$ 9,163,089$ State Sumner County Sedgwick County City of Mulvane USD 263 Revenue 289,293,635$ 24,787,774$ 11,013,577$ 22,710,857$ 11,286,704$ Developer's Contr. - 206,250 - 19,798,000 9,000,000 Cost - 4,048,116 - 29,692,668 - Surplus/ (Deficit) 289,293,635$ 20,945,908$ 11,013,577$ 12,816,190$ 20,286,704$ GLOBAL GAMING PENINSULA GAMING

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