DETROIT/NEW YORK (Reuters) - Detroit's reliance on casino cash to help fund a recovery from the city's historic bankruptcy is a high-risk bet on what is an increasingly shaky source of income.
A trial to approve Detroit's plan to exit its $18 billion bankruptcy, the largest municipal crash in U.S. history, begins in late July.
Flawed revenue projections may undermine its feasibility, creating a key legal hurdle to win approval by the court.On a practical level, a revenue shortfall could knock the city down just as it is getting back on its feet.
Detroit Emergency Manager Kevyn Orr projects that wagering tax revenue from three local casinos, the city's third largest source of cash, will remain essentially steady as far ahead as 2023.
Orr has described the gambling taxes as Detroit's most stable source of money.
But casino revenue has declined of late in Detroit itself and in recent years traditional gambling hubs like Nevada and New Jersey as well as relative newcomers to the wagering scene, such as neighboring Ohio, have seen swoons.
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