He was right.
"The Detroit casino operators are united in disappointment at being singled out for a tax increase,"
"Detroit's gaming industry is already the highest taxed industry in the state. It has made enormous commitments in capital investment and job creation and has paid billions of dollars in vital tax revenues for the City of Detroit and the State of Michigan."
Bing announced the potential tax increase last week during his budget address to City Council, calling on the state legislature to approve a three percent bump in Detroit's portion of the gaming tax for a single year as the city looks to balance its books and address a $155 million deficit.
Detroit casinos reported a combined $1.38 billion in revenue last year and paid more than $99 million in taxes to the state and city. MGM Grand Detroit saw revenue jump 6.3 percent to $581.9 million, while MotorCity and Greektown posted small gains.
The casinos currently face a 19 percent tax rate on gross revenues -- 10.9 percent goes to Detroit and 8.1 percent to the state -- but Bing said raising the local tax by three percent for one year could generate $20 million in additional revenue.
"Do we expect the gaming lobbyists and special interests to be happy about this increase?" Bing asked last week. "No, but everyone recognizes that Detroit's survival is important not just for residents, but for businesses and for our surrounding communities."
In his pitch, Bing pointed out the tax burden for Detroit casinos is roughly 10 to 13 percent lower than those operating nearby in Ohio and Indiana, and he argued they have been "insulated from much of the economic struggle that other area businesses have experienced."
But casino operators said Bing's proposal "couldn't come at a worse time," citing increased competition from Ohio and proposals for more Michigan casinos. And while Ohio may face higher taxes, they point out casinos in Nevada and New Jersey pay only single-digit tax rates on revenue.
Operators also claim they paid a premium to construct their facilities in Detroit, suggesting a new Toledo casino will cost $300 to build while local casinos cost an average of $700 million.
"We kept our promises to the City of Detroit and the people of Michigan to invest in first class casino hotel resorts, create thousands of high paying jobs with great benefits, employ thousands of Detroit residents and purchase goods and services locally," they said.
"We continue to fulfill each of these commitments based upon the promise that we would be able to operate in a stable business environment.
"We trust that the City of Detroit will keep its promises too."
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