Nebraska State Audit Archives

The management of casino tax funds by the Nebraska Racing and Gaming Commission is the subject of a damning audit report released by Mike Foley, the state auditor for Nebraska. The report raises concerns regarding the state's revenue collection practices in its first full year of authorized casino gambling at racetracks by highlighting what Foley calls "lackluster" and occasionally "nonexistent" monitoring. Foley's audit revealed that the Commission neglected to carefully review the annual and quarterly tax returns filed by casinos with licenses, which brought in close to $20 million designated for property tax rebates. This revenue came from casinos in Lincoln, Omaha, Grand Island, and Columbus, but Foley discovered disparities that point to uneven collection methods. For example, it was revealed that Harrah's in Columbus overpaid taxes by $76,184, while WarHorse Casino in Lincoln underpaid taxes by $279,064. The audit also notes that the Commission did not resolve these discrepancies independently. Instead, they only addressed them after Foley’s office inquired. “The Commission couldn’t provide adequate answers regarding casino tax reporting,” Foley said, raising doubts about its accuracy in tax assessments. Calls for Stronger Oversight and Staffing Improvements Foley’s audit includes recommendations for more robust oversight, potentially shifting tax oversight responsibilities to the auditor’s office. He emphasized the need for improvements to ensure that Nebraska collects the appropriate revenue from legalized gambling. In response, Nebraska Racing and Gaming Commission Director Casey Ricketts acknowledged the Commission’s past staffing limitations. Until June, a single employee managed all financial oversight. Additional personnel have since been hired, aiming to strengthen monitoring processes. Ricketts also highlighted collaboration with regulators from other jurisdictions to improve financial oversight related to gambling operations. The audit uncovered other management issues, such as alleged misuse of state vehicles by former employees. A former enforcement director reportedly used a state car for personal errands and commutes, with GPS logs showing discrepancies in reported work hours. In response, Ricketts introduced stricter vehicle management policies, requiring employees to check state vehicles in and out, while increasing monitoring of vehicle logs to ensure proper use. Ricketts acknowledged the Commission’s expanding responsibilities, noting its previous focus on horseracing. The 2020 voter-approved racetrack casino expansion has significantly increased the Commission’s workload, requiring additional resources to keep up with growing operational demands.

Nebraska State Audit

Nebraska Gaming Commission Under Fire Over Casino Tax Oversight Failures