Gamers vie for role in Kansas future

January 22, 2008 10:12 PM
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Gaming Insider by Phil Hevener | The surprisingly spirited campaign to land one of the four Kansas casino licenses is not the biggest project on the list of priorities for most of the companies hoping to set up shop there, but it has spawned intriguing sub-plots that have little to do with projected EBITDA figures.

The kind of stuff that might have Hollywood scriptwriters stopping by for a second look at the state of things to come.

Las Vegas-based Marvel Gaming and its parent, the Binion Family Trust, appear to be one of the semi-finalists in the running for a Kansas casino that might eventually be located in the Sumner County city of Wellington. The plan envisions a casino of some 60,000 square feet with about 300 hotel rooms. What the trust did was create Marvel Gaming, which then hired a group of experienced resort operators, including Roger Wagner as chief executive.

Penn National Gaming is the other semi-finalist recommended to the state by Wellington officials.

But don't go away...the plot is thickening.

Gaming industry giants Harrah-s and MGM Mirage have not abandoned separate joint venture bids to get the right to build and operate casinos in the same area, either of which would be associated with the small town of Mulvane (population about 5,200), which is split by the line separating Sumner and Sedgewick counties.

Both companies lost to Penn and the Binion trust in the first round of reviews by Wellington officials but have since devised plans to create lifelines, if you will, attaching them to Mulvane for the purposes of annexation and a hoped-for recommendation by that city. Harrah's managed to get annexed and its bid approved by a 3-2 vote of the Mulvane Council just last week. The imaginers at MGM are reportedly devising a similar plan.

Approval by the Mulvane Council will enable either or both of them to submit their bids to the Kansas Lottery Commission which will make the final decision.

How will the final decision be made? The Lottery appears to have hired Richard Scheutz to serve as a consultant in helping the body decide which casino companies will get 15-year operations agreements.

Who is Richard Scheutz?

None other than the former husband of Harrah's Senior VP Jan Jones, the company's head of governmental affairs.

A Las Vegan who knows both of them did not try to suppress a grin, saying, "I don’t know whether that will help or hurt Harrah's."

Jones could not be reached for comment.

Why there should be so much interest by big companies in running what will be state-owned casinos in Kansas remains to be seen, but unless neighboring Missouri; reverses its policies, the Kansas gambling halls will not be limited by the $500 loss limit that has been in effect since Day One in Missouri.

A Harrah's official has promised Mulvane, "The premier destination resort in the Midwest; an area of the country that is not generally known for its high-octane nightlife.

You wonder how the small town life of Mulvane might be affected by this kind of reach-for-the-sky planning?

Perhaps Donald Trump will be on the next plane into Mulvane.

On another front in the casinos-come-to-Sumner campaign, it’s easy to believe Harrah’s lawyers may be looking for any sign of involvement by Jack Binion in the Binion trust plan. Binion sold Horseshoe Gaming to Harrah’s for about $1.4 billion about four years ago and has a non-compete agreement that will expire sometime this year.

Wagner who was Binion’s chief operating officer at Horseshoe Gaming says flatly that Binion is not involved in the bid proposal. Besides, he adds, the Binion kids do not have any non-compete restrictions and neither company has a Kansas casino yet.

Does the trust have its sights on any other ventures?

Not at the current time, Wagner said. The newness of the Kansas plan that will eventually produce four casinos means it is difficult to predict how long it will take state officials to decide what they want. None of the parties report that anyone appears to be in a hurry.

Wagner said, "The people in Kansas are all new to this (casino developing) but they are working hard at doing a good job. I have a feeling they'll take whatever time they need."