Ohio’s newest gambling venture will get $60 million in attractive financing help from a port agency that promotes development in the Youngstown area.
The Western Reserve Port Authority is set to offer lease financing for the $125 million horse racetrack and video slot racino in Austintown.
The racino will be built by Penn National Gaming, which operates casinos in Columbus and Toledo. Ohio also has casinos in Cincinnati and Cleveland.
Groundbreaking ceremonies for the new racino are set for Thursday.
Penn National will use the port financing to construct the track, stables, parking lots and buildings, the Vindicator of Youngstown reported.
The project will showcase the authority’s ability to spur economic growth and jobs, according to authority board President Scott Lynn.
“The capital-leasing program is an appealing option for companies because it provides them with tremendous flexibility,” Rose Ann DeLeon, the authority’s executive director, said in a prepared statement.
“That’s why it’s been used in communities across the state to fund a wide variety of projects.”
Port authorities in Ohio can loan money to projects with tax advantages because the authorities are tax-exempt, the newspaper reported.
“Companies can improve the appearance of their balance sheet because financing will not be reflected as a debt of the company, but simply as an operating lease,” according to the Youngstown/Warren Regional Chamber’s website on lease financing.
The project was delayed after state racing officials denied a relocation permit from Beulah Park near Columbus in March. But the Ohio Racing Commission has since given permission to transfer the racing license for the Hollywood at Mahoning Valley Race Course.
In addition to the $125 million investment, Penn has agreed to pay a $75 million relocation fee and $50 million license fee to the state.
Bob Tenenbaum, Penn National Gaming spokesman, said the project will create 1,000 direct and indirect jobs from food, beverage and maintenance to security and housekeeping.
The racino was scheduled to open in early 2014, but Tenenbaum said that due to the permit relocation delay, it could be mid-2014. Seven racinos are planned in Ohio.