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Mississippi Lawmakers Pass Legislation Allowing
 13 Casinos to Rebuild Up to 800 feet Onshore
By Geoff Pender, The Sun Herald, Biloxi, Miss.
Knight Ridder/Tribune Business News

Oct. 8, 2005 - JACKSON -- Coast casinos destroyed by Katrina will be allowed to rebuild up to 800 feet onshore after state lawmakers ended a standoff over how to continue charging them a "tidelands fee" once they no longer float over state waterbottoms.

Lawmakers ended their Katrina-relief special session Friday night after nearly two weeks of wrangling, mainly over the onshore casino and tidelands issues.

Gov. Haley Barbour said he will sign and put the onshore bill and other legislation they passed "into effect immediately."

House leaders left claiming they had saved the Coast's tourism industry, Senate leaders claiming they had saved the tidelands fund.

Many observers left claiming the Legislature can't appear to get anything done promptly and without bitter political warfare, even in the name of Katrina relief. One noted, "The Mississippi Legislature makes FEMA look like they move in a hurry."

Coast leaders consider the onshore casino bill crucial to rebuilding a $2 billion a year tourism industry. If casinos were forced to stay on floating barges, they said, many would not receive the financing and insurance they need to rebuild.

The House passed the onshore bill last week and the Senate followed suit Monday, but Senate leaders held the bill hostage on a parliamentary motion as leverage on the tidelands issue.

Nine of the Coast's 13 casinos had been paying state tidelands leases, calculated and collected by Secretary of State Eric Clark.

The money, about $7 million a year, went to Coast governments for recreation and conservation projects, such as piers and boat ramps.

The Senate never passed its own onshore casino or tidelands bill, but rejected the House tidelands plan. Senate leaders claimed the House bill would allow onshore casinos to wriggle out of paying the state.

The Senate changed the House bill to charge casinos 1 percent of their gross gambling revenue as a tidelands fee.

The House rejected this, saying this amounted to a new tax on casinos at a time when lawmakers were supposed to be helping them rebuild and Wall Street was watching.

After more than seven hours of tedious negotiations Friday, lawmakers passed a plan that would allow casinos that want to remain floating to keep their current leases, which are recalculated by Clark every five years, or to switch to a 30-year lease that will increase yearly with the Consumer Price Index.

Casinos that currently rent land and shore from local governments will be exempt from the tidelands payments, as would Casino Magic Bay St. Louis, which was floating over private shoreline prior to the hurricane.

Any future casinos building on land would pay a fee on a sliding scale, based on the amount of investment the casino makes in its property.

Those investing $50 million or less would pay $400,000 a year. Those investing more than $125 million would pay $750,000. These payments would increase annually based on the CPI.

Senate Finance Chairman Tommy Robertson, R-Moss Point, and House Gaming Chairman Bobby Moak, D-Bogue Chitto, brokered the deal that ended the impasse over tidelands.

The Senate passed the tidelands bill on a voice vote Friday night. The House officially passed it by a vote of 109-4 according to its voting machine, but at the time, only about 40 House members were actually present, not enough for a -- official quorum.

Most had had all they could take of the waiting and political fighting by Friday evening and had left. Under House rules, the vote stands, since no one raised a point of order about a quorum not being present.

Treasure Bay Casino President Bernie Burkholder, who along with many Coast business leaders watched the Legislature haggle the last two weeks, said he hopes to have an onshore casino operating within six months.

"I'm pleased that this thing ultimately prevailed," Burkholder said. "I think the right thing was done for the Coast."

Coast casinos directly employed more than 17,000 people before Katrina hit, and an estimated 50,000 total jobs depend on the industry.


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Copyright (c) 2005, The Sun Herald, Biloxi, Miss.

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