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Council gives $17.5 million in TIF financing for proposed WarHorse Casino

Posted at 6:44 PM, Jul 20, 2021
and last updated 2021-07-20 19:44:11-04

OMAHA, Neb. (KMTV) — A brand-new $220 million casino planned in south-central Omaha was given a tax break by the Omaha City Council on Tuesday.

The proposed major renovation is planned at 63th and Q, turning Horsemen’s Park into the WarHorse casino.

Typically, Tax Increment Financing projects, known as TIF, get little to no opposition at the Omaha City Council.

That was not the case Tuesday, with opponents giving a variety of reasons that the proposed $220 million dollar casino should not get the $17.5 million in TIF financing.

“Where’s the property tax relief? Now that they got it passed, not they got their hand out saying we want 17.5 million to help us build,” said Pat Loonjer, with Gambling with the Good Life. Pat Loontjer has been fighting casino gambling in Nebraska for decades. Helping to stop efforts for years, before voters in Nebraska overwhelmingly approved of it in 2020.

Tuesday, she battled developers of the $220 million WarHorse casino.

They sought out more than $17 million in TIF funds to help spur the project, which includes improving parts of Q street, near Horsemen's Park.

Loontjer was joined by former Omaha Mayor Hal Daub, who questioned if the project qualifies for TIF funds.

“For if a casino is somehow economically a 220-plus million dollar economic development, is infeasible unless they tax paid subsidies,” said Daub.

Here's a general idea of how TIF works for the WarHorse casino.

It would lock the casino in for 15 years at the current value of the Horsemen's Park land, which is around $649,000 dollars.

It currently pays around $13,000 a year in taxes on the property. Those payments would be roughly the same for the 15-year period.

The company also takes out a loan for the $17.5 million in TIF funds for project expenses and pays that back, so instead of spending money on property taxes, it can use the funds to pay for part of the project. In this case that includes road upgrades to Q street.

After 15 years, the organization will begin paying the full property tax amount on its land, valued at $85 million and it would pay somewhere around $1.9 million dollars in property taxes.

That is 130 times more than the company is currently paying.

One Councilmember who was vocally supportive was Vinny Palermo, whose district would include the casino.

“We would welcome it proudly with the jobs that it would create,” said Palermo.

While TIF funds are used often, and usually granted with little pushback, this was different. Since Nebraska just recently legalized gambling, a casino has never been TIF financed.

The council debated and asked questions of city staff and developers for more than an hour on multiple questions, including whether the casino was holding back crucial documents.

Gambling with the Good Life sent in a public information request for the entire WarHorse casino application. The city sent back some parts of the application but redacted other portions that include proprietary information, which could be used by competitors.

The Nebraska Attorney General’s office issued an opinion saying they agreed with city lawyers.

City Planner Don Seten reassured the council that they would have likely redacted this information from any applicant for TIF, if it was requested by the public.

Opponents also questioned whether the casino qualifies for TIF.

They say the company backing it, Ho-Chunk Inc. — which is owned by the Winnebago Tribe of Nebraska — spent millions in pushing for gambling legalization and likely would build a casino in the Omaha area regardless.

City attorneys seemed to convince most of the city council that the project qualifies, saying the size and scope of the project, along with the improvements to Q Street wouldn’t happen unless TIF financing was given.

Palermo is happy that the street improvement will be made privately and not with tax money.

“All of us in this room, everybody listening, would have to pay for these improvements to happen,” said Palermo.

The casino developers are hoping that the new construction and renovation will be finished in the fall of next year.

Developers say the city will see $7.5 million a year after the casino is built, thanks to taxes set forth when the voters passed the three ballot measures. That does not include sales and restaurants taxes, which they expect to be several more hundred thousand dollars.

The lone 'no' vote was Councilmember Don Rowe, who said while he was overall in favor of the casino happening, didn’t think the city needed to use TIF funds to make it happen.

The planned casino includes a sports bar, a variety of other bars, coffee shops and an enhanced horse racing area.