Indiana Senate passes food and beverage tax on upcoming Hard Rock Casino in Gary

The Indiana Senate approved Tuesday a bill to establish a new tax on food and beverage sales at the upcoming Hard Rock Casino Northern Indiana, to pay for enhanced municipal public safety efforts near the Gary gaming property.

House Bill 1065, which passed the Republican-controlled chamber 31-19, imposes the Region's first 1% food and beverage tax on sales at restaurants and bars in the $300 million casino that's scheduled to open December 31 adjacent to the Borman Expressway at Burr Street. The legislation mandates the money only be used by the city of Gary for public safety purposes within 1 mile of the casino site at 29th Avenue and Burr Street.

The nonpartisan Legislative Services Agency projects the tax will raise a total of between $460,000 and $920,000 after it takes effect on the casino's opening day and Jan. 1, 2025, when the tax is due to expire, The Times of Northwest Indiana reports.

The tax is supported by Gary Mayor Jerome Price and Spectacle Entertainment, majority owner of the new Hard Rock casino as well as the existing Majestic Star casinos at Gary's Buffington Harbor on Lake Michigan.

Senate opposition to the proposal had little to do with the Gary casino safety food and beverage tax, though House Speaker Brian Bosma, R-Indianapolis, has expressed concern about the General Assembly directly imposing the tax, instead of the city.

Rather, numerous senators objected to a separate section in the omnibus tax legislation allowing, but not requiring, public school districts to share property tax referendum revenue with local charter schools — a provision added Monday after Lt. Gov. Suzanne Crouch broke a Senate tie in favor of the revenue sharing option.

State Sen. Eddie Melton, D-Gary, whose district borders the new land-based Gary casino, said the possibility that the cash-strapped Gary public schools might be forced to split their revenue with the city's numerous charter schools led him to oppose the measure. "Even just the 'may' brings concern because in the twinkling of an eye it could become a 'shall,'" Melton said.

In response, state Sen. Travis Holdman, R-Markle, the sponsor, pledged that he'd sooner scuttle the entire 41-page measure than allow that to happen.

The proposal still must be approved by the House, or go to a House-Senate conference committee to craft a compromise acceptable to both chambers, before it can advance to Republican Gov. Eric Holcomb to be signed into law.