This one is based around this article from the latest edition of the Champion. The first paragraph is I think a bit of fear mongering saying that basically if Mohawk doesn’t get a casino, we’ll be faced with a 22-25% tax hike in taxes. There is no question the town will be hit hard financially- the racetrack provides between $5.5-6 million/ year to the coffers. But would it really be that bad? What the lead paragraph misses out I think is, the timing part; we’re being faced with the hike… but over how long? What it misses is the fact Milton is still a growing, expanding town. New residents arrive, new houses, and businesses are built all providing more tax dollars. If the 22-25% hike is true, I doubt it will all take place in one year; you still have to manage growth or what little remains of it because a tax hike of that size would kill it.
The reason this is suddenly hitting the news is that there are plans to completely cut the horse-racing subsidy, which, would cripple the industry. The provincial government would have us believe that the move is part of its attempts to implement parts of the Drummond Report. In a way they’re right, but I don’t think Drummond meant for the subsidy to be completely cut before the government worked with the industry on replacing that revenue.
One basic business principle is if you take away one source of revenue (i.e. the subsidy) it has to be made up somewhere else. Where else does Mohawk get a good chunk of its revenue? The slot machines leading us to the idea of a Casino. Increase the amount of slot machines, gaming tables and betting opportunities and you’ll increase the revenue. Increase the amount of revenue, and Mohawk will still have a racetrack. Taking it a step further; the Community fund will be richer, and we’ll avoid the previously mentioned tax hike. So yes, there is a lot riding on the possibility of a Casino at Mohawk. If it happens, we all win; everything continues rosy.
if Milton doesn’t get a Casino at Mohawk taxes will likely go up. The revenue that would be lost has to be at least partially replaced somewhere, and the obvious place to do it would be to raise taxes. As we read these figures of 22-25% let’s keep in mind that it’s all hypothetical until the final decision is made by the provincial government later this fall.