WATERLOO - Mayor Tim Hurley said the Isle Casino Hotel Waterloo has helped local property owners avoid jumps in their property tax bills.

During a presentation at Monday's City Council meeting, Hurley responded to concerns voice about gaming revenues during the Dec. 22 council meeting and similar questions from constituents questioning whether gambling was bringing the tax relief they were promised.

"Is it tax relief? I say yes, definitely, absolutely without question in my mind," Hurley said. "It isn't tax reduction that's written into our agreement; it's tax relief."

Through a combination of gaming taxes, license fees, property taxes and hotel-motel taxes, the presence of the casino, which opened June 30, 2007, has brought in additional revenue to the city to offset the need to raise property taxes, he said.

"We've been able to keep up city services and, in some cases, add and do a little bit more," Hurley said. "The gaming revenues have had a positive impact."

A breakdown of the major revenue sources follows:

? A half percent of the casino's adjusted gross revenues - essentially the money gamers lose in casino games - goes directly into the city's general fund, which pays for police, fire protection, parks, cultural and arts, the library and general administrative services of the city. That came to $375,867 in the last fiscal year and is on pace to reach $390,000 this year.

Black Hawk County government also receives a half percent of the AGR for its general fund.

? Another half percent of the AGR goes directly into the city's general fund through a development agreement. That amount will increase to a full 1 percent starting July 1, 2009.

? The casino and hotel property has a taxable value of $73.7 million for the next fiscal year, which will generate approximately $3.2 million in new property, including more than $1.3 million for the city of Waterloo with the rest going to schools and county government. The casino is paying about $1.3 million in property taxes this year based on the partial construction value from 2007.

Without the property taxes and development fees the city would have had to cut back services or raise property taxes to maintain them, Hurley said.

? Hotel-motel tax receipts have jumped significantly since the casino opened, providing additional revenue for local tourism related projects and offsetting the need for the city to tap property taxes for improvements to the Five Sullivan Brothers Convention Center.

? The Isle advanced $1 million to the city in 2005 before the casino even opened, which was divided among a number of uses, including $410,000 to save eight police and firefighter positions which had been slashed from the adopted budget. Another $300,000 was used for the Phelps Youth Pavilion construction, $200,000 was applied to close a gap in the next year's general fund budget and the rest was split among smaller projects.

? The casino advanced $3 million and made a gift of $1 million to help pay for the city's downtown Riverfront Renaissance projects.

? The Black Hawk County Gaming Association, which holds the license for the casino, receives the biggest slice of the gaming taxes locally at 5.75 percent of adjusted gross revenues. Those dollars are doled out in grants amount local governments and charities in Black Hawk and surrounding counties through a competitive process.

The city of Waterloo alone has received more than $400,000 in grants from the BHCGA for capital projects and an emergency home repair program for low-income residents.

It's arguable whether money used for capital projects can be deemed property tax relief. While the revenue negates the need for general obligation bonds and other tax revenue to complete projects, one must assume the city would actually do the work if gaming grants were not available.

Based on calculations provided by the city, the $1.3 million going directly into the city's general fund this year from the property taxes, host city fee and development fee knocks about $30 of the property tax bill of a home with an assessed value of $100,000. That grows to more than $130 for the same home if the grants awarded by Black Hawk County Gaming Association are included.

Contact Tim Jamison at (319) 291-1577 or tim.jamison@wcfcourier.com.