HOUSE BILL No. 4648

 

May 17, 2011, Introduced by Reps. Tlaib, Olumba and Santana and referred to the Committee on Tax Policy.

 

     A bill to amend 1996 IL 1, entitled

 

"Michigan gaming control and revenue act,"

 

by amending section 12 (MCL 432.212), as amended by 2004 PA 306.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 12. (1) A wagering tax is imposed on the adjusted gross

 

receipts received by the licensee from gaming authorized under this

 

act at the rate of 18% 23%. If a city exercises either of the

 

options in subsection (4), the tax rate under this subsection shall

 

be 8.1% 10.1% and deposited in the state school aid fund to provide

 

additional funds money for K-12 classroom education. If the city

 

rescinds or is otherwise unable to exercise 1 of the options in

 

subsection (4), the tax rate under this subsection shall be 18%

 

23%. A tax rate of 18% 23% imposed under this subsection shall

 

cover any period for which the city does not or is unable to

 


exercise 1 of the options in subsection (4).

 

     (2) The state casino gaming fund is created in the department

 

of treasury. The fund shall be administered by the department in

 

accordance with this act. Except as provided in sections 12a and

 

13, the taxes imposed under this section plus all other fees,

 

fines, and charges imposed by the this state shall be deposited

 

into the state casino gaming fund. The wagering tax is to shall be

 

remitted daily by the holder of a casino license to the department

 

of treasury by electronic wire transfer of funds. The state

 

department of treasury shall remit the city's portion of the

 

wagering tax to the city daily by electronic wire transfer of funds

 

as provided by this act.

 

     (3) If the state imposes a wagering tax under subsection (1)

 

equal to 18% 23% of adjusted gross receipts, money in the state

 

casino gaming fund that is not from a tax imposed under subsections

 

(5) to (8) shall be allocated as follows:

 

     (a) 55% to the city in which a casino is located for use in

 

connection with the following:

 

     (i) The hiring, training, and deployment of street patrol

 

officers.

 

     (ii) Neighborhood and downtown economic development programs

 

designed to create local jobs.

 

     (iii) Public safety programs such as emergency medical services,

 

fire department programs, and street lighting.

 

     (iv) Anti-gang and youth development programs.

 

     (v) Other programs that are designed to contribute to the

 

improvement of the quality of life in the city.

 


     (vi) Relief to the taxpayers of the city from 1 or more taxes

 

or fees imposed by the city.

 

     (vii) The costs of capital improvements.

 

     (viii) Road repairs and improvements.

 

     (b) 45% to the state to be deposited in the state school aid

 

fund to provide additional funds money for K-12 classroom

 

education.

 

     (4) A city in which a licensee is located may do 1 of the

 

following:

 

     (a) In the development agreement into which the city is

 

entitled to enter, include a provision that requires the licensee

 

located in the city to pay the city a payment equal to 9.9% 12.9%

 

of the adjusted gross receipts received by the licensee from gaming

 

authorized under this act.

 

     (b) By ordinance, levy, assess, and collect an excise tax upon

 

licensees located in the city at a rate of 9.9% 12.9% of the

 

adjusted gross receipts received by the licensee from gaming

 

authorized under this act.

 

     (5) Subject to subsections (6) to (8), a wagering tax in

 

addition to the tax imposed in subsection (1) is imposed on the

 

adjusted gross receipts received by a licensee from gaming

 

authorized under this act at the rate of 6%. Money from the tax

 

imposed under this subsection that has been deposited in the state

 

casino gaming fund shall be allocated 1/3 to the city in which the

 

licensee's casino is located for use in connection with to be

 

expended for the purposes listed in subsection (3)(a), 7/12 to the

 

general fund, and 1/12 to the Michigan agriculture equine industry

 


development fund. The city may collect its share of the tax under

 

this subsection directly using 1 of the methods in subsection (4).

 

For a period during which the licensee is paying the city's share

 

of the tax under this subsection directly to the city under either

 

of the methods in subsection (4), the payment to the state casino

 

gaming fund under this subsection shall be 4% and shall be

 

allocated 7/8 to the general fund and 1/8 to the Michigan

 

agriculture equine industry development fund.

 

     (6) Subject to subsections (7) and (8), and unless an act of

 

God, a war, a disaster, or an act of terrorism directly and

 

substantially impacts the ability of the licensee to complete

 

construction of its casino and casino enterprise, if a casino

 

licensee is not fully operational by each of the following dates,

 

the tax on the licensee under subsection (5) shall be as follows:

 

     (a) July 1, 2009, 7%, allocated 1/2 to the general fund, 1/14

 

to the Michigan agriculture equine industry development fund, and

 

3/7 to the city in which the licensee's casino is located.

 

     (b) July 1, 2010, 8%, allocated 7/16 to the general fund, 1/16

 

to the Michigan agriculture equine industry development fund, and

 

1/2 to the city in which the licensee's casino is located.

 

     (c) July 1, 2011, 9%, allocated 7/18 to the general fund, 1/18

 

to the Michigan agriculture equine industry development fund, and

 

5/9 to the city in which the licensee's casino is located.

 

     (7) Subject to subsection (8), and irrespective of whether

 

there has been an increase under subsection (6), after a casino

 

licensee has been fully operational for 30 consecutive days, the

 

licensee may apply to the board for certification under this

 


subsection. If the board determines that a licensee that makes an

 

application under this subsection has been fully operational and in

 

compliance with its development agreement that is in existence on

 

July 1, 2004 or a subsequent original development agreement, for at

 

least 30 consecutive days, the board shall certify the licensee

 

under this subsection, and the tax imposed on the licensee under

 

subsection (5), as adjusted, if applicable, by subsection (6),

 

shall be, retroactive to the first day of the 30 consecutive day

 

period that the licensee was fully operational, reduced to 1% and

 

shall be allocated entirely to the city where the licensee operates

 

its casino.

 

     (8) If the McCauley-Traxler-Law-Bowman-McNeely lottery act,

 

1972 PA 239, MCL 432.1 to 432.47, is amended to allow the operation

 

of video lottery at horse racetracks in this state, and if video

 

lottery is being conducted at horse racetracks in this state, the

 

licensee is no longer obligated to pay the wagering tax under

 

subsections (5) to (7).

 

     (9) Notwithstanding section 9b, if the McCauley-Traxler-Law-

 

Bowman-McNeely lottery act, 1972 PA 239, MCL 432.1 to 432.47, is

 

amended to allow the operation of video lottery at horse racetracks

 

in this state, and if video lottery is being conducted at horse

 

racetracks in this state, a casino licensee may, after obtaining

 

approval from the board, apply to the racing commissioner executive

 

director of the board for authorization to simulcast horse races

 

under the horse racing law of 1995, 1995 PA 279, MCL 431.301 to

 

431.336. A casino licensee that is authorized under this subsection

 

shall display and allow wagering on simulcast horse races only at

 


the licensee's casino and shall comply with all applicable

 

provisions of the horse racing law of 1995, 1995 PA 279, MCL

 

431.301 to 431.336, rules promulgated under that act, and the

 

written permit to conduct simulcasting and any related order issued

 

to the licensee by the racing commissioner executive director of

 

the board. Simulcasting and wagering under this subsection are

 

under the primary control of the racing commissioner executive

 

director of the board, and the racing commissioner executive

 

director may revoke or suspend the authorization of or take other

 

disciplinary action against the licensee for failing to comply with

 

a law, rule, permit, or order as required by this subsection.

 

However, the simulcasting and wagering under this subsection is

 

part of the licensee's casino operation under this act and subject

 

to the same control by the board as are other parts of the

 

licensee's casino operation. The board may take disciplinary action

 

under section 4a against a casino licensee for failure to comply

 

with a law, rule, permit, or order as required by this subsection.

 

     (10) A casino licensee is entitled to the same commission from

 

money wagered on horse races simulcast by the licensee as a race

 

meeting licensee is entitled to receive from wagering on simulcast

 

horse races under the horse racing law of 1995, 1995 PA 279, MCL

 

431.301 to 431.336. The same taxes, fees, and other deductions

 

shall be subtracted and paid from the licensee's commission as are

 

subtracted and paid from a race meeting licensee's commission under

 

the horse racing law of 1995, 1995 PA 279, MCL 431.301 to 431.336.

 

     (11) Payments to a city under 1 of the methods in subsection

 

(4) shall be made in a manner, at those times, and subject to

 


reporting requirements and penalties and interest for delinquent

 

payment as may be provided for in the development agreement if the

 

payment is required under a development agreement, or by ordinance

 

if the payment is required for a tax levied by the city. Payments

 

required under the method described in subsection (4)(a) may be in

 

addition to paid with any other payments which may be required in

 

under the development agreement for the conveyance of any an

 

interest in property, the purchase of services, or the

 

reimbursement of expenses. Payments to a city under the method

 

described in subsection (4) shall be used by the city for the

 

purposes listed in subsection (3)(a).

 

     (12) Approval by the city of a development agreement or

 

adoption of an ordinance approving either casino gaming or the levy

 

of a local excise tax does not constitute the granting of a

 

franchise or license by the city for purposes of any statutory,

 

charter, or constitutional provision.

 

     (13) The taxes imposed under this section and any tax imposed

 

under section 13(2) shall be administered by the department of

 

treasury in accordance with 1941 PA 122, MCL 205.1 to 205.31, and

 

this act. In case of conflict between the provisions of 1941 PA

 

122, MCL 205.1 to 205.31, and this act, the provisions of this act

 

prevail.prevails.

 

     (14) Funds Money from this act shall not be used to supplant

 

existing state appropriations or local expenditures.

 

     (15) As used in this section:

 

     (a) "Fully operational" means that a certificate of occupancy

 

has been issued to the casino licensee for the operation of a hotel

 


with not fewer than 400 guest rooms and, after issuance of the

 

certificate of occupancy, the casino licensee's casino, casino

 

enterprise, and 400-guest-room hotel have been opened and made

 

available for public use at their permanent location and maintained

 

in that status.

 

     (b) "Michigan agriculture equine industry development fund"

 

means the Michigan agriculture equine industry development fund

 

created in section 20 of the horse racing law of 1995, 1995 PA 279,

 

MCL 431.320.