For a while, casinos seemed like they might have been the “answer” for the Pittsburgh Penguins when they were struggling to keep their team together many moons ago. Now it looks like at least a few people hope that they might help the Columbus Blue Jackets stop their considerable financial bleeding.
The Blue Jackets president believes that the casino taxes that will flow to Columbus and Franklin County would be the best fix for the hockey team’s financial woes.
“I think it is the most viable solution, and it wouldn’t require any other money being used,” Mike Priest said today. “But it’s up to the public sector to decide how it wants to use that money.”
Business, government and team officials have been meeting for more than a year to come up with a way to stem the Blue Jackets’ bleeding. The club is losing an estimated $12 million a year in operations.
A 2009 report blamed the team’s arena deal – the Blue Jackets pay $5 million annual rent and lose $4 million to run Nationwide Arena – as the biggest factor in the poor finances.
It’s a pretty simple formula for teams outside of “traditional” markets: if you struggle often enough you’ll probably end up dealing with some cash flow issues. Here are a few more details from the Dispatch.
Local leaders have considered a number of possibilities, from using casino dollars to raising taxes on rental cars, hotel stays and alcoholic beverages, to help support the team. They say that losing the NHL franchise would devastate the Arena District.
Priest said using casino taxes is the most attractive idea so far because the city and county would not have to seek voter approval to use the tax money.
Four casinos, including one along W. Broad Street, are approved to be built in Ohio. A 33 percent state tax on gross casino revenue could generate $24million for Columbus and about $16million for Franklin County, according to Penn National Gaming, the developer of the Columbus casino.
City and county officials said it’s too early to say whether casino taxes will be the solution for the Blue Jackets.
Even if they’re a middling franchise at best, the Blue Jackets still play at least 41 games per year at Nationwide Arena. It makes sense, then, that the region would suffer without that regular draw. The team might not see any of that casino money until 2012, so this is more of a potential long-term situation.
In the mean time, new GM Scott Howson must attempt to put a winning team together. A playoff run or two would certainly improve their money situation – though it won’t necessarily “fix” everything. It’s might be better than banking on a lottery ticket in the form of casino cash, though …
(H/T to Kukla’s Korner.)