BY CHRIS CHRISTOFF
LANSING BUREAU CHIEF
LANSING -- Over strong objections from Detroit's three casino operators, the House voted Thursday to allow video lottery terminals at Michigan's seven horse racetracks, and to allow horse wagering by telephone and Internet.
The bills face tough opposition in the Republican-controlled Senate, as well as a potential lawsuit. But Thursday's action was a milestone for horse-racing interests that have tried for years to legalize slot machines at tracks. The video lottery terminals are similar to slot machines.
The 61-42 House vote strengthens Gov. Jennifer Granholm's hand to help the state's budget crisis by wresting more taxes from the state's Native American casinos, which also fear losing gambling customers to racetrack slot machines. Granholm could agree to veto the bill -- if it passes the Senate -- in exchange for a higher state take on Indian casino revenues.
Granholm has said she opposes the proliferation of gambling in the state, but has not denounced the racetrack bills outright.
"This has to be very carefully thought through and I'm willing to look at what comes out of the Legislature," Granholm said Thursday in Detroit. "But what we don't want is a huge proliferation of casinos at racetracks."
Strong bipartisan support pushed through the two key bills in the package in the GOP-dominated House, with Democratic "yes" votes outnumbering Republicans.
The bills were promoted as salvation for the state's waning horse-race industry while generating millions of dollars for the state and schools. The legislation would allow up to 2,000 machines per track.
Racetrack machines would be regulated by the state lottery bureau. Revenues would be divided among the state School Aid Fund, the state general fund, and racing and agricultural interests involved in horse racing.
The House Fiscal Agency estimates that if each track in Michigan installs 2,000 machines, they would generate between $200 million and $400 million per year.
The track betting machines would cut into the three Detroit casino's business, said Roger Martin, spokesman for the Greektown Casino. He said "chances are pretty doggone good" that the racetrack bills would face a lawsuit to block them from becoming law.
Peter Ellsworth, attorney for the MGM Detroit Grand Casino, said the bills violate the intent of Proposal E, the statewide ballot issue approved in 1996 that legalized the Detroit casinos.
Ellsworth said to comply with Proposal E, all of the racetrack bills require a three-fourths vote of both the House and Senate. Thursday's votes on two key bills fell well short of the 83 votes needed for a three-fourths vote.
Operators of the Detroit casinos complain that betting machines at racetracks would cut deeply into their business. That, they argue, would mean $40 million less to Detroit from direct taxes paid by the casinos on their revenues and income taxes from laid-off casino workers.
LANSING BUREAU CHIEF
LANSING -- Over strong objections from Detroit's three casino operators, the House voted Thursday to allow video lottery terminals at Michigan's seven horse racetracks, and to allow horse wagering by telephone and Internet.
The bills face tough opposition in the Republican-controlled Senate, as well as a potential lawsuit. But Thursday's action was a milestone for horse-racing interests that have tried for years to legalize slot machines at tracks. The video lottery terminals are similar to slot machines.
The 61-42 House vote strengthens Gov. Jennifer Granholm's hand to help the state's budget crisis by wresting more taxes from the state's Native American casinos, which also fear losing gambling customers to racetrack slot machines. Granholm could agree to veto the bill -- if it passes the Senate -- in exchange for a higher state take on Indian casino revenues.
Granholm has said she opposes the proliferation of gambling in the state, but has not denounced the racetrack bills outright.
"This has to be very carefully thought through and I'm willing to look at what comes out of the Legislature," Granholm said Thursday in Detroit. "But what we don't want is a huge proliferation of casinos at racetracks."
Strong bipartisan support pushed through the two key bills in the package in the GOP-dominated House, with Democratic "yes" votes outnumbering Republicans.
The bills were promoted as salvation for the state's waning horse-race industry while generating millions of dollars for the state and schools. The legislation would allow up to 2,000 machines per track.
Racetrack machines would be regulated by the state lottery bureau. Revenues would be divided among the state School Aid Fund, the state general fund, and racing and agricultural interests involved in horse racing.
The House Fiscal Agency estimates that if each track in Michigan installs 2,000 machines, they would generate between $200 million and $400 million per year.
The track betting machines would cut into the three Detroit casino's business, said Roger Martin, spokesman for the Greektown Casino. He said "chances are pretty doggone good" that the racetrack bills would face a lawsuit to block them from becoming law.
Peter Ellsworth, attorney for the MGM Detroit Grand Casino, said the bills violate the intent of Proposal E, the statewide ballot issue approved in 1996 that legalized the Detroit casinos.
Ellsworth said to comply with Proposal E, all of the racetrack bills require a three-fourths vote of both the House and Senate. Thursday's votes on two key bills fell well short of the 83 votes needed for a three-fourths vote.
Operators of the Detroit casinos complain that betting machines at racetracks would cut deeply into their business. That, they argue, would mean $40 million less to Detroit from direct taxes paid by the casinos on their revenues and income taxes from laid-off casino workers.
