FISCAL NOTE

Senate Bill 453 as introduced proposes a constitutional amendment to establish the Alabama Lottery and to allow class III gaming at four racetrack casinos. Upon ratification and once operational, the Alabama Lottery will deposit an estimated $285-$300 million annually to the Lottery Trust Fund and be made available to the Alabama Legislature for future appropriations. Upon ratification and once operational, the receipts to the State General Fund will increase an estimated $75 million annually by the levying of a 13% state gross receipts tax on gaming revenue. Receipts to the local governments where the four racetrack casinos are located will also increase by a combined estimated $6 million from the 1% local gross receipts tax levied on the gaming gross revenue. These estimates may vary depending upon the provisions of the general laws required to be enacted for the implementation of this amendment.

This amendment will also increase receipts to the State General Fund by an undetermined amount dependent upon whether covered game equipment is owned by the operator or leased. If owned, this amendment levies a 1% state gross receipts tax on gaming revenues or if leased, a 4% state covered vendor tax on the proceeds from the leases or revenue sharing arrangements on non-racetrack owned covered games and equipment. This amendment will increase obligations to the Governor and could increase receipts to the State dependent on the terms of a compact between the Governor and the Poarch Band of Creek Indians for the conduct and operation of covered games in its three Alabama locations upon ratification by the Legislature. This amendment will also increase obligations to the State by creating the Alabama Lottery and Gaming Commission to regulate and supervise the Alabama Lottery, the Alabama Lottery Corporation, covered games by racetracks, and charitable bingo games.

This constitutional amendment requires a statewide election on September 15, 2015 which will increase the obligations to the State General Fund by an estimated $4 million in FY 2015. If this constitutional amendment is ratified, it will increase obligations to the State General Fund by an estimated $320,000 for the required Legislative Special Session to be held within thirty days after ratification.