City has yet to diversify its tax base or reduce its dependence on gambling tax revenue
LA CENTER — Ten years ago this month, I was hired as a reporter at The Reflector Newspaper. Marvin Case, then owner of The Reflector, assigned the city of La Center to me as my first “beat’’ at the paper.
The last “beat’’ that I had had as a journalist prior to that was covering the Portland Trail Blazers and the National Basketball Association for The Columbian Newspaper. That assignment following multi-million dollar athletes included covering three NBA Finals series, two involving the Blazers and another involving the Seattle SuperSonics. A stark contrast to covering a sleepy little city of about 3,000 residents. I had been in arenas with more than 20,000 people, so joining 20 or 30 people at a council meeting didn’t exactly blow my skirt up if you know what I mean.
I didn’t let Marvin know about my lack of enthusiasm for the new assignment he had just given me. But, what I didn’t realize at the time was this beat, on a much different level, was going to captivate me just as much as my previous, much more high-profile assignment.
The compelling storylines in La Center had actually started several years before I arrived on the scene. This little bedroom community was on the verge of big change. The writing was on the wall. It was inevitable to most observers that the Cowlitz Tribe would be successful in its attempt to build its mega casino, ilani, which opened in April.
At the time I began covering La Center, the city enjoyed the benefits of a goose that laid more than 3 million golden eggs (dollars) each year. That golden goose was the four card rooms in La Center that provided about 75 percent of the city’s revenue.
Times were good in La Center. City staff was paid well and had cadillac benefit packages. Virtually anything that needed funding in the city was funded, within reason, and that small little municipality had a reserve account with almost $20 million in it.
It didn’t take me long to realize that wonderful existence wasn’t going to last forever. I had been to the Spirit Mountain Casino in Grand Ronde, Ore. and the Chinook Winds Casino in Lincoln City, Ore. It wasn’t hard to imagine how La Center’s financial fortunes were going to change with a similar casino next door at the I-5 junction.
There was no way the four card rooms in La Center would continue to thrive with a mega casino just a couple of miles away. In fact, two of them went out of business even before the ilani Casino opened in April. The Chips Casino closed in January 2014 and the New Phoenix followed in March of this year. And, the performance of the two remaining casinos is such that the owners have officially asked the members of the La Center City Council to cut the gambling tax in half for the final three months of this year and to enter into discussions about a new arrangement after that.
The gambling tax revenue the city is receiving from the two remaining card rooms has reduced significantly in 2017. The estimated year-end total is $2,326,800, compared to $3,136,044 actual revenue in 2016. The gambling tax revenue is now about 50 percent of La Center’s total general fund revenue and declining.
La Center’s elected officials and staff have done a very good job of preparing for this reduction in revenue. The actual 2017 revenue is more than was budgeted for and even though it is expected to come in at about $800,000 less than last year, the city is expected to have a budget surplus at the end of 2017 of about $400,000.
Anticipating the reduction of revenue, city officials elected not to fill some vacant staff positions. Specifically, three full-time and one part-time position(s) have not been filled — community development director ($160,000), a patrol officer ($115,000), a maintenance worker ($91,000) and a community development office support ($12,000) position. That’s $378,000 in salary and benefits the city saved by not filling the positions.
The city is entering its 2018 budget process and ultimately the council members will have to decide if they are going to permanently eliminate those positions. Those are difficult decisions that elected officials don’t enjoy making.
La Center’s staff and elected officials will no doubt need to prepare for more reductions in gambling tax revenue. And, the ultimate survival of the two remaining card rooms is very much in question. It’s possible that someday La Center won’t have any cardrooms or the revenue that they still generate. I’m not predicting that, and certainly not rooting for that, but one would have to be incredibly naive not to realize it’s a possibility.
For the past 10 years, I have listened to La Center officials talk about the need for the city to diversify its tax base. But, despite all that talk, the city has virtually had no success in attracting new businesses that would generate revenue to replace the gambling tax dollars La Center has been so dependent on for so long.
As a result of that desperate need to attract new business or industry, I’m assuming the discussion about the community development director position will be the most intense. La Center, in my opinion, needs to hire a superstar (forgive my sports terminology) to fill that position. If the city doesn’t attract new taxpayers, almost immediately, future budget decisions are going to be much more painful than they will be in the next couple of months for the 2018 budget. I guess it’s the old “you’ve got to spend money to make money’’ cliche.
So, despite the fact that, as editor of ClarkCountyToday.com I have a whole county to cover, it’s hard for me not to keep a watchful eye on what’s going on in this little bedroom community tucked away in the northern part of our county where there is seemingly never a dull moment.