SCHENECTADY — After years of promises from local officials about the economic benefits of bringing a casino to Schenectady, county and municipal leaders are putting together a budget for the first time working with actual figures from Rivers Casino & Resort.
Eight counties and one city receive quarterly payments from Rivers' taxable gaming revenue. While the money has thus far fallen short of the casino's own projections, it will largely be used to offset property tax increases in the coming year, area officials said. Those organizing 2018 budgets widely consider the extra money as a positive, but differ on the scale of its expected impact.
“It helps, but it’s not necessarily a game changer,” said Montgomery County Executive Matthew Ossenfort. “It won’t make or break the county budget.”
“It’s multiple millions of dollars in revenues, thousands of new jobs, it transformed a brownfield that sat there underutilized and abandoned,” said Schenectady Mayor Gary McCarthy. “It’s significant.”
“There’s no question it’s a significant amount of money,” said Saratoga County Administrator Spencer Hellwig. “We’re talking hundreds of thousands of dollars. You can’t discount it as immaterial.”
The state taxes Rivers’ gaming revenue at a rate of 10 percent on table games and 45 percent on slot machines, which is the highest among commercial casinos in New York. The rate was determined in the Upstate New York Gaming and Economic Development Act of 2013, which legalized the construction of new commercial casinos in Schenectady, Seneca and Sullivan counties, and the expansion of Tioga Downs.
Of the tax money, 80 percent is redistributed to public schools across New York, based on the state’s education formula. Another 10 percent is split evenly between the city and county of Schenectady as host communities.
The remaining 10 percent is divided among Albany, Fulton, Montgomery, Rensselaer, Saratoga, Schoharie and Washington counties, based on population. For example, Albany County receives the highest percentage, then Saratoga County, and so on.
Until this year, counties poised to benefit from the taxed gaming revenue had only projections to work with, submitted in 2014 by Rush Street Gaming as part of its proposal to win one of the state’s four commercial gaming licenses.
The city and county of Schenectady used the low-end projection for 2017, and pro-rated it to a March opening to come up with an expectation of $2.75 million for the 2017 budget. While weekly revenue totals have ebbed and flowed to date, Rivers appears likely to fall well short of that projection at year’s end.
But as finance commissioners, budget directors and county executives look to formulate a 2018 budget, the casino’s performance thus far provides tangible figures to use for future estimates. Most budgets will be proposed in the coming weeks, then approved in the next two months following public hearings.
In the city of Schenectady, McCarthy said he wouldn’t get into specifics, only saying casino money would be listed as a revenue source in the upcoming budget, and calling it a significant help.
McCarthy, who in 2016 suggested the city might see up to a 10-percent tax cut thanks to casino money, must submit a budget proposal by Oct. 1. The City Council is expected to hold a public hearing on the budget on Oct. 10, and must adopt the 2018 budget on or before Nov. 1.
Schenectady County intends to use casino revenues to provide property tax relief and annual cost savings, officials said. A year ago, officials expected to see $900,000 in annual savings, but given Rivers’ performance so far, that number was reduced to about $855,000 annually.
In neighboring counties, money will almost universally be put toward tax relief.
In Albany County, which gets the largest cut of gaming revenues outside of Schenectady city and county, casino revenues will be put into the general fund for tax stabilization and to offset any potential cost increases, County Executive Dan McCoy said in an email.
In the future, the county will “conservatively budget each year’s casino revenues based on past year’s performance and future outlooks and trends,” he said.
Saratoga County finds itself in a distinct position, receiving some money from the racino in Saratoga Springs and some money from Rivers Casino in Schenectady. Last year, the county received about $775,000 in video lottery terminal revenue from the racino, said Spencer Hellwig, the county administrator
The additional casino revenue will come in handy when juggling rising service costs and state mandates, Hellwig said.
“There’s not going to be any elaborate use for the money because we’re just trying to maintain the level of services while costs continue to go up,” he said.
While Saratoga and Albany counties did not provide a specific budget amount being penciled in for the casino in 2018, Fulton County’s initial proposal has a line for $175,000 in gaming revenue for next year, said Alice Kuntzsch, the county’s budget director.
That money will be put toward property tax relief, she said, adding that every little bit of added revenue helps. Typically, the county budget falls around $90 million, meaning the casino revenue accounts for less than 1 percent of the overall budget.
It’s a similar fraction in Montgomery County, where the annual budget is about $113 million, and Ossenfort, the county executive, said officials have budgeted $200,000 for casino revenues in 2018.
Like many area officials, Ossenfort views the Rivers Casino infusion as helpful, but not something the county can rely on to change its larger outlook.
“More times than not you’re being wary of expenses increasing or new expenses coming down the pipe, so to have a new revenue line is certainly a positive,” Ossenfort said. “It’s not a major revenue source, but when we’re making decisions with this budget that come down to $10,000 or $20,000, it certainly helps.”
THE NUMBERS SO FAR
The New York State Gaming Commission provides monthly reports on gaming revenue distributions among Rivers Casino & Resort’s beneficiaries. Here’s how much Rivers has paid out to each through August, with the percentage of the taxed gaming revenue each one receives in parentheses:
- Education (80 percent): $21 million
- Schenectady County (5 percent): $1.3 million
- City of Schenectady (5 percent): $1.3 million
- Albany County (3.44 percent): $902,740
- Fulton County (.63 percent): $164,791
- Montgomery County (.57 percent): $149,027
- Rensselaer County (1.8 percent): $473,113
- Saratoga County (2.48 percent): $651,694
- Schoharie County (.37 percent): $97,184
- Washington County (.71 percent): $187,596