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Table games losing money at Wheeling Island

| Tuesday, March 5, 2013, 12:01 a.m.

WHEELING, W.Va. — Poker, roulette and blackjack are becoming a problem for Wheeling Island Hotel-Casino-Racetrack, which expects to lose about $1 million this year on its table games.

President and general manager Jim Simms said Wheeling Island is losing customers to casinos in Ohio and Pennsylvania. The games are labor-intensive.

“We have done everything we can to reduce our costs and to increase our customer base, but our ability to drive revenue is very limited now,” he said.

Wheeling Island's losses on table games have grown from $3,365 in the first two months of 2012 to $171,407 in the same period this year.

The losses don't include a $2.5 million annual fee that Wheeling Island and the state's other three racetracks must pay the West Virginia Lottery Commission to offer the games.

“I take great pride in my responsibility to keep the business stable — and to keep our associates in a comfortable working position,” said Simms, who plans to leave Wheeling Island to open a new casino in Lebanon, Ohio. “But if we have to pay this $2.5 million fee again, we are going to have to seriously consider whether to continue offering table games.”

The Pennsylvania Gaming Control Board announced last month that gross table game revenue in the state's 11 casinos was 12 percent higher in January than it was in January 2012.

West Virginia's tax rate on table gaming is 35 percent, compared with 33 percent in Ohio and no more than 16 percent in Pennsylvania. The Mountain State's slot machine tax rate is 42 percent, while the rate in Pennsylvania is 55 percent. Ohio's tax rate is 33 percent.

Simms said Wheeling Island effectively pays a slot machine tax rate of about 57 percent because of breeders' funds, purse funds and local supplements.

“As long as we are going to be taxed at rates higher than our competition, we are at a complete disadvantage. They have brand new facilities in prime locations,” Simms said.

Simms said he would like to see the Legislature discuss table-gaming taxation and the annual fee before the regular session ends in April.

“That $2.5 million that we pay ends up going to different charitable groups. We are absolutely not trying to take money from those organizations that we are glad to support,” he said. “All we are asking for is to have a discussion to see if there is any way the Legislature can revisit this issue.”

Wheeling Island has not made any decision regarding table games. The racetrack's table gambling license expires July 13.

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