Plan B for Ruidoso Downs Racetrack bill
Jim Kalvelage reporting for the Ruidoso News


Ruidoso Downs, NM - February 3, 2010 - After tax parity for racinos appeared doomed, new legislation would provide a local option, via an election, to raise GRT rate.

New legislation that could provide a tax break for racinos in New Mexico, through a county gross receipts tax, has been introduced at the Roundhouse.

The measure, submitted last Thursday, came just days after another bill, to provide "tax equity" for the Ruidoso Downs Race Track and Casino, was deemed all but dead.

The proposed new "local option county business retention gross receipts tax," called HB203, would provide tax relief for gaming operations at horse racetracks.

In counties that impose the new tax, the bill would require an amount up to $1 million in annual county business retention gross receipts tax revenues go to the state. Those revenues would be used to offset a gaming tax credit of up to 50 percent of a racino's monthly gaming tax.

The credit would be limited to $1 million annually. Any remaining tax revenues would be sent back to the county for promotion or administration of the county, instructional or general purposes for a public post-secondary educational institution in the county, capital outlay to expand or relocate a public post-secondary school in the county, or funding professional services for economic development planning.

"If this passes it would give counties the option of putting it on the general ballot," said New Mexico House Rep. Zach Cook (R-Ruidoso), who has co-sponsored the bill. "They (the voters) would say if they want to."
Before a county commission could impose the county business retention gross receipts tax, a majority of voters in the county would have to provide their approval at an election.

The board of commissioners would have to adopt a resolution calling for the election within 75-days of adopting an ordinance seeking the special tax. If the voters approve the measure, the ordinance setting the county business retention tax would take effect.

The effective date could be July 1 or Jan. 1. If the tax is turned down by voters, the county commission would have to wait one year before another attempt at the tax.

"I'm getting a favorable reaction from people in Lincoln County," said Cook. "And I know there is some opposition too. It's the people in the county making the decision."

An earlier bill that would have reduced the gaming tax for lower revenue racinos ran into trouble because of the state's financial problems.

"If the tracks can instead claim a tax credit, and if they do, that would obviously hurt the state," said Cook. "That's why we came up with this where the county will reimburse the state."

Cook said the earlier graduated gaming tax bill "is not going anywhere."

The chief sponsor of the gross receipts tax bill is Rep. Thomas Garcia (D-Ocate).

His District 68 covers parts of northern New Mexico, including the Raton area, where a new racetrack and casino is scheduled to open later this year.

The new proposal is being looked at by local officials hoping to keep Ruidoso Downs Race Track and Casino in the Ruidoso area.

"It gives another option that we're going to look at and evaluate," said Sandi Aguilar, executive director of the Ruidoso Valley Chamber of Commerce.

"We'll talk with the various lobbyists and legislators and we'll poll our members."

In December the chamber initiated an effort to the local track and casino. That followed the track's request before the New Mexico Racing Commission in November to move the facility to the Las Cruces area. For several years track officials have said they might seek to relocate because of competition from nearby tribal casinos who pay a lesser percentage in revenue sharing to the state compared to the track-casinos gaming tax.

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