Casino consolidation raises Cedar Rapids’ hopes

CEDAR RAPIDS - Did a surprise glimmer of hope emerge Thursday for future prospects of a Cedar Rapids casino?

Mayor Ron Corbett said it's a hope brighter than that.

Nearly 14 months ago, the five-member Iowa Racing and Gaming Commission turned down a local request for a casino license, concluding that a Cedar Rapids casino would cannibalize too many customers from the nearby Riverside Casino & Golf Resort.

However, in an unrelated vote Thursday, the gaming commission approved the consolidation of ownership into a single entity of Iowa's three casinos - at Riverside, Davenport and Larchwood - that are owned, in part, by Dan Kehl.

Kehl, whose family is a pioneer in Iowa's casino industry, was the public face of the successful campaign to protect the Riverside casino and to defeat Cedar Rapids' attempt to secure a state casino license in 2014.

In an interview after the commission's vote Thursday, Chairman Jeff Lamberti said he 'wasn't sure I know the answer” to whether the consolidation might make the new entity sufficiently robust that the commission might someday look more favorably on a Cedar Rapids proposal.

'I think I could make an argument, possibly, as you look at the overall entity now, you're going to have three operating casinos, and certainly, some of the justification of that is spreading out some of the risk,” Lamberti said.

He said the new three-casino consolidation called Elite Casino Resorts would be better 'insulated” from gambling pressures that might come with changes in casino and video gambling next door to Iowa in Illinois because Elite has other facilities that would not be impacted.

'So I think you could potentially make that argument, but I think it's hard to say right now what the impact will be,” he said. 'But certainly, one of factors to make the decision (to consolidate) was to spread some risk and also to reduce some costs to be able to take advantage of some economies of scale.”

Mayor Corbett said the commission's central reason to turn down a license for a Cedar Rapids casino was its worry that the Riverside Casino 35 miles to the south would lose too much business.

'Now with him (Kehl) combining all his casinos, it shows how much his casino cartel makes,” Corbett said. 'And it shows that the overall impact - in the future when we get back in front of the Racing and Gaming Commission after its moratorium ends - to Riverside can be spread out over the other casinos.

'So this long-term can be seen as something favorable that gives a confidence boost to Cedar Rapids citizens who have been supportive of the casino.”

Only one Cedar Rapids advocate for a local casino attended the commission's meeting Thursday at the Hard Rock Hotel and Casino in Sioux City - retired Cedar Rapids lawyer Eugene Kopecky.

He is continuing his one-man fight for a Cedar Rapids casino, and Thursday was turned back by the commission, which rejected his request to get the commission to reverse its April 2014 decision denying a license for a casino here.

Kopecky's petition was necessitated by a Linn County District Court ruling last year in which he was told he first needed to use the state regulatory process before he could challenge the commission in court.

Thursday's defeat clears the way for Kopecky to go back to court. 'Right now, that's the most logical option,” he said Thursday.

After the meeting, Lamberti said he did not believe that commission sentiment had changed since it decided in 2014 to take a break from accepting applications for casino licenses for the 'foreseeable” future. he decision stopped short of a formal moratorium, he said, but he said the thought was that the pause might last at least three years.