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Gaming tax revenue drop in Atlantic City stirs concern over casino fund
By DONALD WITTKOWSKI Staff Writer, 609-272-7258
Published: Monday, November 10, 2008

  ATLANTIC CITY - Not every dollar that's deposited in a slot machine or bet at the gaming tables goes into the pockets of Atlantic City's casinos.

New Jersey has an 8 percent tax on gross gaming revenue to finance state programs benefiting senior citizens and disabled residents, including prescription drug subsidies, transportation services and housing assistance.

For years, things seemed rock solid with the Casino Revenue Fund, but for the first time ever there will be public hearings held by an advisory commission to discuss how to divvy up the money in the wake of Atlantic City's gaming slump.

The first hearing is scheduled Nov. 19 in Atlantic City at the New Jersey Casino Control Commission office at Tennessee Avenue and the Boardwalk. The second will be held Nov. 21 in Senate Committee Room 4 at the State House Annex in Trenton, and the third Dec. 9 at the Bergen County Freeholders Conference Room in Hackensack. Each hearing will run from 9 a.m. to 1 p.m.

Misono Miller, chair of the Casino Revenue Fund Advisory Commission, said the panel wants to hear directly from the public to make sure critical programs aren't being underfunded.

"We're talking about increases for programs that have been underfunded and are crucial to the support of senior citizens who are trying to live in their homes," she said. "We have to state the need for the programs. We have to state the case why these programs need more funding than in the past."

The advisory commission has recommended changes in a spending formula to compensate for what Miller believes are funding inequities. More money would primarily go for casino-financed transportation services if the state Legislature approves the recommendations.

The Casino Revenue Fund budget peaked at $502.3 million in fiscal year 2006, but has declined the past two years because of a downturn in the gaming industry. For fiscal year 2008, the budget was $413 million.

Competition from Pennsylvania's slot parlors caused Atlantic City gaming revenue to fall 5.7 percent in 2007. The casino slump has grown worse this year because of the sluggish economy, with revenue down 6.3 percent through the first nine months. State tax breaks on casino income also have cut into the funding pool, according to the advisory commission's 2008 annual report.

Most of the Casino Revenue Fund, about $216 million, goes to support the Pharmaceutical Assistance to the Aged and Disabled program, or PAAD. People eligible for the PAAD program may purchase their medications for only $5, regardless of the cost of the medicine. About 200,000 senior citizens and disabled people benefit from the program.

Miller, who also serves as executive director of the Cumberland County Office of Aging and Disabled, argued the PAAD program is strong enough to redirect some of its funding to other services hit hard by the decline in casino revenue. That issue is expected to be discussed at the public hearings.

According to Miller, the transportation assistance program has suffered the most. The program gives the elderly and disabled rides to their doctor's offices, medical facilities, nutrition sites and senior centers. But transportation funding is projected to drop from $36.9 million in fiscal year 2008 to $33 million in fiscal year 2009, forcing counties to consider making cuts in paratransit.

"All of the counties have indicated they will be reducing services, somehow," Miller said.

In Miller's Cumberland County, there will be $60,000 in transportation cuts. As a result, one driver and one transportation dispatcher may lose their jobs, she said.

Stressing the importance of paratransit services, the advisory commission is calling for legislative approval of a bill to increase the Casino Revenue Fund's spending formula for transportation from 7.5 percent to 8.5 percent.

State Assemblyman Vincent J. Polistina, R-Atlantic, a legislative representative on the Casino Revenue Fund Advisory Commission, said the public hearings will give lawmakers some guidance in setting spending priorities. But at the same time, he is demanding more accountability from the state Treasury Department in its oversight of the casino tax revenue.

"I have not been able to get a full accounting of how the money is being spent," Polistina said.

E-mail Donald Wittkowski:

DWittkowski@pressofac.com

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