Wisconsin probe could cloud Empress deal

April 23, 2001 6:03 AM
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Midwest

An investigation involving the attempt to build a Kenosha Indian casino in Wisconsin could cloud Argosy Gaming’s bid to purchase the Empress Casino in Illinois.

Argosy has formed an alliance with principals involved in trying to build the tribal casino. Partners include Nii-Jii Entertainment and the Menominee Tribe of Wisconsin.

Currently, investigators are probing what happened to the $1 million Argosy paid into the project. The company also pledged up to $35 million to help fund it.

In addition, Argosy was to manage the project if it were ever built. Although Argosy has not been accused of wrongdoing, investigators are seeking an accounting of the $1 million.

Officials are also probing Nii-Jii, which owes money to the Menominee tribe, and the state of Wisconsin.

Argosy officials say the company’s role in the Wisconsin project is limited.

West
Another (ho hum) California Casino

The $40 million Valley View Casino last week opened its doors to patrons waiting to get at its 760 slot machines, 12 blackjack tables and 260-seat buffet.

Operated by the San Pasqual tribe, the casino is located in northern San Diego county. The casino, which doesn’t allow alcoholic beverages, is part of a planned resort that will eventually feature a hotel and other amenities.

Most of the state’s tribal casinos have been built in San Diego County.

DigiDeal goes to Wash.

DigiDeal, the maker of an electronic, cardless blackjack table, has asked the Washington Gambling Commission for a permit to sell its table in casinos and cardrooms.

The blackjack table has a live dealer, and players use real chips, but "cards" are electronically dealt and displayed on video displays built into the table top.

The manufacturer says the tables eliminate cheating and honest mistakes by dealers. The device features a computer program that electronically deals blackjack from a "six deck shoe."

New bill targets online gambling

A bill circulating in the California Assembly would ban most forms on Internet gambling in the state. AB1229, which won approval in the Assembly’s Government Operations Committee, would make online gambling a misdemeanor and would fine online casinos that took bets from California players.

The bill would also allow law enforcement to go after financial institutions that assist online gambling in California through account wagering or advanced deposit wagering.

East
Slots pay off in Delaware

The three Delaware racetracks reported slot machine revenue of $41.9 million, a 9.3% increase for the month of March.

The revenue breakdown by track: Delaware Park, $20.9 million (up 5.7%); Dover Downs, $13.4 million (up 1.5%); and Harrington Raceway, $7.7 million (up 33.1%).

Harrah’s wants Showboat tower

Harrah’s is considering adding a third tower at its Showboat Casino-Hotel in Atlantic City.

"The issue for us over the last six months is where we do it, not if we do it," said Colin Reed, chief financial officer of Harrah’s Entertainment. He added that the company intends to build a new tower with 400-500 guest rooms.

The Showboat, which currently has only 800 rooms, posted a first quarter decline in net revenue of 5.5% to $81.1 million.

Solid foundation

Boyd Gaming reports that construction crews have set nearly 3,700 pilings that will support the $1 billion Borgata casino hotel.

Construction of the high-rise and low-rise steel frame should begin this summer. The project is scheduled for completion in summer 2003.

South
Shawnee plans I-40 casino

The Shawnee Absentee Tribe is ready to begin constructing a casino and truck stop on Interstate 40 in Oklahoma.

"We’re breaking ground in May. This is going to be a reality," said James Edwards, governor of the Absentee Shawnee Tribe. He added the project will generate nearly 900 jobs.

The planned 240,000-square-foot facility is to be built off I-40 and State 9A at the Earlsboro exit. Edwards said construction will be in two phases, with the first phase costing about $50 million.

Penn close to sealing riverboat deal

Penn National Gaming is getting closer to owning the Casino Rouge riverboat casino in Baton Rouge, Louisiana. Penn is ready to close the purchase of Florida-based CRC Holdings, which owns a piece of the riverboat, and it is also buying out the minority owners.

Cost of the acquisition will be about $200 million. Penn National already owns the Casino Magic hotel and casino in Bay St. Louis and Boomtown Casino in Biloxi, both in Mississippi.

At a special meeting last week, the Mississippi Gaming Commission approved CRC Holdings to act as a subsidiary of Penn National, which is based in Pennsylvania. The approval was needed because CRC would be involved in the operations of Casino Magic and Boomtown.

Delta Downs has license on the line

The Louisiana Racing Commission has ordered the financially-strapped Delta Downs race course to meet certain financial conditions or risk losing its racing license.

In the process, commissioners approved Delta Downs’ 10-year contract to operate the track, and 80 racing days in 2001-2002.

In return, Delta Downs must produce a certified financial statement by Aug. 10; show there are no liens against the track except for mortages and other debt; and promise to report bi-weekly any disbursements made from a $4 million fund created after the track took out a recent $7 million loan.

Mississippi gaming win slips in March

Mississippi casino revenue decreased slightly in March to $243.2 million, down from $247.9 million in the same month last year.

The 12 casinos on the Mississippi Gulf Coast reported revenue of $97.4 million, compared to $104.2 million won in March 2000.

In Tunica and the river counties, the other 18 casinos took in $145.7 million, compared to the $143.7 million posted in March 2000.

So far this year, gross casino revenue totals $698.7 million, including $290.3 million from the coast and $408.3 million from the Mississippi River casinos.


New York embroiled in benchmark tribal case
By: James Rutherford

"It’s chaos," says one of the principal attorneys involved in the legal mess in New York over plans to build a Las Vegas-style Indian casino in the Catskills - and a recent state court ruling scrapping the proposal is far from the last word on the controversy.

As expected, the state Attorney General’s Office, on behalf of Gov. George Pataki, has notified all the parties to the case that it will appeal the April 10 decision by state Supreme Court Justice Joseph Teresi in Saratoga County Chamber of Commerce v. Pataki nullifying a gaming compact between Pataki and the St. Regis Mohawks. The compact, required by federal law, would authorize the Mohawks and their management and development partner, Park Place Entertainment, to build a $500 million casino and hotel in Monticello about 75 miles north of New York City. Ruling in response to a lawsuit brought by a coalition of anti-gambling groups, business interests and four state lawmakers, Teresi said Pataki has no constitutional authority to enter into gaming compacts with Indian tribes without the consent of the New York Legislature.

"The Attorney General’s Office does not agree with that and neither does our client, the Governor’s Office," said a spokesman for Attorney General Eliot Spitzer, who filed a notice of appeal within days of Teresi’s ruling. Pataki’s office did not return several phone calls last week requesting comment.

Albany attorney Cornelius Murray, who represents several of the casino’s opponents in the case, hailed the decision as a victory for the constitutional doctrine of separation of powers.

"What we did was draw the proverbial line in the sand," he said. "Enough is enough."

"Do I disapprove of gaming? No. I just believe you’ve got to respect the Legislature," said state Assemblyman Keith Wright, who filed a separate lawsuit opposing the compact. Teresi combined the two suits for the purposes of rendering his decision.

The ruling does not affect the Oneida Tribe’s hugely successful Turning Stone casino near Syracuse nor the Mohawks’ small gambling hall on the tribe’s Akwesasne reservation on the Canadian border.

Barring an expedited appeal, the next round of legal arguments won’t be heard until fall at the earliest, according to Murray. Technically, Spitzer has nine months to put together his appeal, meaning the next word from the courts may not be forthcoming until next year. That decision, however it turns out, is likely to be appealed to New York’s highest court, the Court of Appeals. Then, unless some of the litigants either run out of money or resolve, the case is certain to wind up in the federal courts.

But don’t expect the Mohawks to back off. Estimates have the 165,000-square-foot Catskills casino generating anywhere from $300 million to $450 million of cash flow a year. That’s a lot of wherewithal for a tribe with 40 percent unemployment and whose border enclave near Lake Champlain has been notorious for smuggling, gun battles and political skullduggery.

Speaking of wherewithal, there doesn’t seem to be much to the reports that Donald Trump, a vocal opponent of casinos in New York state, has been bankrolling the plaintiffs in the interests of protecting his Atlantic City casinos.

"We’re not funded by Mr. Trump. We don’t represent Mr. Trump. We’ve steered a totally independent course from him," said Murray.

Wright’s counsel in the case, Manhattan lawyer Jay Goldberg, has also done legal work for Trump, according to one source. Wright, however, said he’s had "no involvement whatsoever" with The Donald in the case. Goldberg did not return phone calls last week.

As for Park Place, the Las Vegas-based casino giant that has already invested more than $1 million in the Monticello site and stands to make tens of millions from its management of the casino, they’ve had little to say. The company is not a party to the Saratoga case although it is embroiled in legal actions brought by the Mohawks’ former development partners and a faction of the tribe. Nor is it known how the Park Place-Mohawk marriage will be affected by the death last fall of Park Place Chairman Arthur Goldberg, who had a close relationship with the tribe.

In a prepared statement issued last week, Park Place President and CEO Thomas E. Gallagher said, "We remain committed to work with the St. Regis Mohawk Tribe and the state of New York in both Akwesasne and the Catskills in whatever manner is permitted by New York law."