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Iowa tries to figure out how to reopen casinos

The doors of operational normalcy may be creaking open in parts of the United States, but large gathering places remain far from finding their “on” switches.

In the face of the most disruptive pandemic in a century, states such as Iowa are attempting to slowly restart their economies. Republican Gov. Kim Reynolds, for example, on Friday declared that restaurants and other select businesses in 77 counties (of the state’s 99) less ravaged by the coronavirus here may operate at 50 percent capacity to galvanize financial engines.

Yet almost all of the city’s significant population centers in a state of roughly 3.15 million people are located in 22 counties still under stricter closure guidelines until at least May 15.

Moreover, the new guidelines for this first phase of reopening don’t apply to mass gathering centers such as the state’s 19 licensed casinos, most of which have been shuttered since mid-March. So the wait continues for Iowa Gaming Association president and CEO Wes Ehrecke and his member facilities.

Ehrecke estimated that of the state casino industry’s roughly 8,800 employees, the vast majority of them have now been temporarily laid off after initial compensation plan structures relative to a COVID-19 work stoppage have elapsed. The most notable of those dominoes to fall came this past week, when nonprofit Prairie Meadows casino and horse racetrack in the Des Moines metro area announced the layoffs of 1,130 employees effective May 3, leaving 73 essential personnel for casino operations.

Since shuttering voluntarily March 16, Prairie Meadows had approved compensation plans for its workers first through April 16, and then again through May 2. Affected employees are still receiving health benefits through July 31. But for now, an indefinite furlough begins for employees of the facility that brought in the lion’s share of the state’s $1.5 billion in total gaming and sports wagering revenue in the 2019 fiscal year.

“We want to continue assisting our employees as they navigate these difficult and challenging times,” said facility president and CEO Gary Palmer in a company news release. “Teamwork and support of each other continues to be at our core of operation. We are optimistic and hopeful for the future.”

But what will that future look like? As soon as this week, Ehrecke said the association hopes to have the guts of a comprehensive “procedures and protocols” plan available for its member casinos for when even a partial all-clear is given. From disinfecting and sanitization plans to recommendations on social-distancing-conscious seating arrangements for approved table games, facilities will be able to adapt and amend the plans based on their individual needs, he said.

“We’re definitely all in this together as to what (an eventual reopening) might look like,” Ehrecke said. ‘We’ll conform and adapt.”

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In the immediate term, he said he’ll be watching what other jurisdictions are doing if they plan on opening more quickly, and his regional counterparts will all be comparing notes, he said. Once there is any kind of go-ahead, Ehrecke said officials will need between five and 10 days to reopen — from re-hiring furloughed staff to new training on sanitary protocols, among other concerns.

“Although the industry is a lot more robust than it was 10 years ago, it’s still highly specialized,” said Iowa Racing and Gaming Commission administrator Brian Ohorilko. “Given the training many facilities have already given employees, they will want them available (upon a resumption).”

Prairie Meadows executive vice president Brad Rhines said via email that he did not wish to comment on speculative return timelines for the casino, and he did not respond to a question about issues relative to the reopening of its pari-mutuel facility, which was scheduled to have his season-opening weekend last week.

The balancing act involves more than simply opening up the facility, rehiring staff and having participants keep their social distance. Ohorilko explained that state agreements require that a thoroughbred season run 67 days and that a quarter horse campaign have 26 race days. The Iowa Greyhound Track in Dubuque also has a set number of dates to clear.

Presently, it appears highly unlikely that Prairie Meadows or many other racing facilities would be able to meet such yearly standards, which are kept in order to maintain proper purse levels annually, since those are directly correlated to adjusted gross receipts from casino revenues.

A special agreement for 2020 on the number of race dates and purse levels may be needed to accommodate future revenue projections if this season is shortened or is conducted without spectators in attendance, he said.

To gauge another idea of a potential opening timeline — Iowa passed 10,000 reported positive COVID-19 cases this week — Ohorilko said his department has been gathering information for upwards of three weeks to be prepared to expedite a reopening.

That said, 60 percent of his working staff has been temporarily assigned to help the state Iowa Workforce Development program, which has handled more than 250,000 new unemployment claims the past weeks — a per capita range not seen since the Great Depression.

While a sliver of the door might be creaking ajar, expectations remain realistic, if not pessimistic.

“We anticipate the return of patrons will be flower at first. It’s not going to be ‘open the doors, and we’re back at full capacity,’” Ehrecke said. “It will take some time to give assurances that we are a safe place to go back to. Hopefully, though, we will be welcoming many of them back.”