Build casino on city land, former C.R. official urges

Rick Smith
Published: October 4 2012 | 3:30 am - Updated: 1 April 2014 | 1:27 am in
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CEDAR RAPIDS - The former director of the city's Department of Development encouraged a mayoral commission on gaming last night to locate any riverboat casino on city property on the Cedar River's west side next to Czech Village.

Jim Halverson, senior project manager with Howard R. Green Co. since leaving city employment in 2001, said placing any boat on city property would put the operation under city control and significantly increase the share of revenue from the boat coming into local government coffers.

In addition, Halverson said such a location could create a healthy development "linkage" with historic Czech Village next door and the soon-to-be-capped landfill nearby.

He went as far as to suggest that a local public-sector entity own any riverboat casino so that local government, not a private casino operator, gets a big share of casino profits.

Race track/casinos in Polk and Dubuque counties are owned by such entities and generate considerable money for local governments there.

But other Iowa communities with gaming have chosen to let the casino operator pay the large sum needed to build and own the operation.

Halverson, who said he was neither for nor against gaming, was among more than 15 people who came to the microphone in the council chambers at City Hall last night to advise the mayor's ad-hoc Citizens Commission on Gaming.

Phil Suess, commission chairman, explained to the 100 or so in attendance that the nine-member commission's task was not to be for or against gaming. The task, he said, was for the commission to study how best to establish a casino in the community if Linn County voters approve a gambling referendum Nov. 4.

Most in attendance seemed to understand the commission's role and did not use last night's forum to vent for or against a casino.

Halverson's comments come with some credibility because he presided over the city's Department of Development at a time when the city first turned its attention to cleaning up the old industrial "brownfield" sites south of downtown.

The one concrete riverboat proposal to date has come from the Missouri-based Grace Entertainment Inc., which wants to dock a riverboat casino on the east side of the river at the site of the former Farmstead Foods packing plant.

Grace and the current owners of the old packing plant have signed a deal to put a casino there. The contract, however, does not preclude Grace from placing its boat elsewhere in Cedar Rapids, Larry Seckington, the gaming company's legal counsel, said before last night's forum.

Duke Daughtery, a Cedar Rapids accountant who said he had much experience auditing casino operations in and out of Iowa, also urged the mayoral commission to consider locating the casino on public land and to consider having local government or a local non-profit group own it.

Daughtery said few Indian communities have had the capital upfront to build a casino operation but have entered into agreements where an operator builds the casino, gets a hefty share of revenue early on to pay for the investment and then, after a few years, turns the operation over to the Indian tribe.

The city or the local non-profit association that is required to hold any gaming license could craft a similar deal for the community, Daughtery suggested. Owning a casino could mean the difference between a few million dollars in gaming revenue coming to city government and perhaps $25 million or more a year, he said.

Mayoral commission members said they expected other casino operators to make a pitch to locate in Cedar Rapids or Linn County if voters approve gambling Nov. 4.

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