Harrah’s plan: $117 million more taxes than competitors
By Andrew Conte
Tuesday, February 14, 2006
The backers of a proposed Harrah’s Station Square Casino say their plan would raise $117 million more in annual state and local taxes than either of their competitors could, according to a letter they sent to governmental leaders Friday.
The casino at Station Square would bring in more than $347 million a year for Pittsburgh, Allegheny County and the state — compared to a $230 million estimate for their nearest competitor, Cleveland-based Forest City Enterprises says.
Majestic Star Casino, a proposal backed by Detroit businessman Don Barden on the North Shore, would raise about $230 million, while Isle of Capri Casino, the Biloxi, Miss., company partnered with the Penguins, would bring in slightly less than that, according to the letter.
“This is about property tax relief,” said Abe Naparstek, Forest City’s spokesman. “We’re going to raise over $100 million more per year.”
Forest City, which is seeking the license for Pittsburgh’s stand-alone slots parlor, sent the letter to Mayor Bob O’Connor and county Chief Executive Dan Onorato on Friday. Las Vegas-based Harrah’s Entertainment would operate the casino.
By projecting to raise more tax money, Forest City says its proposal proves the Penguins arena would not be free to taxpayers. The public cost of clearing land for the arena would be at least $50 million, it says. And Isle of Capri’s proposal would bring in less tax money.
“It is disingenuous to say the arena is free,” Forest City’s Executive Vice President Brian Ratner says in the letter. “We believe it will cost the tax payers over $115 million a year.”
Forest City based its projections on a larger overall investment, which would mean more money in annual property taxes. The Harrah’s casino would cost an estimated $512 million, compared to publicly stated projections of $325 million for Majestic Star or $250 million for Isle of Capri.
The estimate for Station Square does not include the economic impact of 1,250 proposed condo units.
The Cleveland company also expects its casino to be more lucrative than stated projections from its competitors. Forest City says its casino will bring in more than $617 million a year by its second year of operation. That’s $200 million more than either of its competitors have said they expect to make.
That would make Pittsburgh the nation’s 15th largest market, based on a study by the American Gaming Association of 2004 casino revenues.
Andrew Conte can be reached at email@example.com or (412) 765-2312.
This article appeared in the Pittsburgh Tribune Review © Pittsburgh Tribune Review