By Dave Stafford, Herald Bulletin Staff Writer
dave.stafford@heraldbulletin.com
ANDERSON - In the high-stakes game of paying for political influence, Hoosier Park and its parent company have more money on the table than nearly anyone.
But at the General Assembly, the Anderson racino hasn't gotten the payoff it was hoping for. At least not yet.
The racino and its parent company, Centaur LLC, spent $534,434 to lobby members of the Indiana General Assembly, according to 2009 filings with the Indiana Lobby Registration Commission.
Taken together, the sum that Hoosier Park and Centaur spent to hire lobbyists and wine, dine, and influence lawmakers, represents the largest lobbying total for a business in Indiana, according to a Herald Bulletin analysis of 2009 lobbying reports filed with the state.
More than a dozen gaming interests reported lobbying expenses in the most recent period, but Hoosier Park and Centaur seemed to go all in. For every lobbying dollar spent by gaming concerns, more than 40 cents came from Hoosier Park or Centaur. The vast majority of the money paid salaries for Hoosier Park and Centaur lobbyists.
The spending at the statehouse during the 2009 regular and special sessions came as Centaur was beginning to show signs of economic distress. Since then, Centaur in August missed an interest payment to senior lenders, causing the company to default on one of its loans.
But lobbyists for Hoosier Park said its success or troubles are entwined with the system that regulates the racino - unfairly, they claim.
"I think because of those financial challenges, that's part of the reason we felt it necessary to make an all-out effort to try to obtain some relief from the legislature," said Phil Bainbridge, general counsel for Centaur, who lobbied members last year. He said the racino had an obligation to shareholders, the community and its lenders to seek a break on a $250 million licensing casino fee that he called "unprecedented."
"Unfortunately, that did not happen," he said. "We had to do everything we could to try."
"When it was determined that revenue levels would not meet initial projections for Indiana's first racino as it navigated uncharted waters, it quickly became apparent that the model in place limits sustainability and places Indiana's racino industry at risk," said Centaur spokeswoman Susan Kilkenny.
"There was much work to accomplish during a relatively short period of time. To accomplish this important work in the most efficient and effective manner, a team of lobbyists was assembled to help educate legislators about the facts of the situation and possible solutions," Kilkenny said.
Calls to Jim Brown, general manager of gaming at Hoosier Park, were referred to Centaur.
Riverboat casinos pay a tax and fee rate of 35 percent compared with 47 percent for racinos, Kilkenny said. "If you would compare a riverboat that had identical gross revenues, Hoosier Park would incur $24 million more in taxes," Bainbridge said.
Hoosier Park and the state's other racino, Indiana Live! in Shelbyville, also had to pay a fee of $250 million for a state license and is taxed at a higher rate. But its operator, Indianapolis Downs, paid only a fraction of Hoosier Park's lobbying tab.
While Hoosier Park didn't get the break it was looking for in the legislature, it got its word out. And the legislature formed a study committee that next month is expected to announce its recommendations on a wide range of gaming issues.
John Keeler, assistant general counsel and lobbyist for Centaur, said Hoosier Park didn't try to steer the committee, but "did make a substantial presentation" that illustrated the disparity in taxation between racinos and riverboats.
"Repairing of that disparity will be essential if racinos are to remain viable," he said.
"While we were unsuccessful in the relief we sought to achieve, I don't think there's any doubt that in terms of educating legislators and making them aware of our situation, we accomplished a great deal."