Posted Online: Feb. 19, 2013, 6:34 pm
Riverboat Development Authority wants meeting on casino issue
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By Stephen Elliott, firstname.lastname@example.org
In the midst of a battle over a proposed city-owned, land-based casino, members of the Riverboat Development Authority, the nonprofit that holds the gaming license, are calling for a meeting to settle the issue.
The RDA must approve the city's plans for a land-based, city-owned casino.
Last October, the city announced it had reached a tentative agreement to buy Rhythm City Casino from Isle of Capri for $46 million and established a nonprofit controlled by the city to move the riverboat casino onshore.
The city's plan was to keep gaming profits in the community by building an improved land-based casino that would raise significant new revenue to the city.
"Gaming profits will no longer be going to New York, Chicago or Las Vegas," Davenport Mayor Bill Gluba said in October. "Gaming profits will be staying in our community. This is a game changer for Davenport."
City officials hoped to present a plan to the Iowa Racing and Gaming Commission in March, but those plans have been delayed because the 12-member RDA board, which has met four times since October, has not reached a consensus giving the city the go-ahead for the project.
There are, as Mayor Gluba has said, many twists to the tale. City manager Craig Malin has promised the RDA almost double the revenue it currently receives if it will approve the project. The RDA receives about $2 million per year in Rhythm City Casino revenues.
Mr. Malin repeated that promise on Tuesday."I look forward to the RDA approving an agreement which doubles their revenue to more than $4 million dollars a year, increases jobs, trades an old riverboat casino for a modern land based casino and retains $10 million or more in gaming revenue each year in our community," he said by email.
The RDA uses the revenue to distribute grants to local nonprofits and civic organizations.
But, RDA members, including treasurer Don Decker, are leery of the city's offer. Mr. Decker said Mr. Malin's math doesn't take into account the city's risk, and therefore, the taxpayer's risk.
Mr. Decker, and several members of the Davenport business community, are concerned about the city's financial involvement in the project, and a city board overseeing casino operations.
In November, the city formed the Davenport Community Improvement Corporation, a nonprofit board appointed by the mayor, to oversee the operations. The board includes the city manager, police chief and an alderman.
Initially a seven-member board, it was expanded to nine members, at the request of chairman Kelli Grubbs, to bring more financial expertise to the board.
Mayor Gluba appointed the initial seven members. The additional two were appointed by the DCIC.
The DCIC board has not only been a concern for some RDA members, but also of the Iowa Racing and Gaming Commission, which has the final say on any casino project.IRGC president Jeff Lamberti has stated his concerns about the DCIC creation publicly.
Mr. Decker has been calling for another RDA meeting so members of the business community can express concerns. Those members include John Gardner, director of the former Quad-City Development Group and former publisher of the Quad-City Times; Hap Volz, member of Community Foundation of the Great River Bend who served 40 years as a trust officer and senior vice president of Wells Fargo Bank; Steve Landauer, a Davenport accountant; Mike Duffy, president of Per Mar Security Services and others.
Mr. Decker and RDA member Chad Lewis oppose the city's role in a new casino operation.
Other RDA members, such as Becky Bray, want financial information from other sources. In January, RDA members heard a presentation from city consultant and former Jumer's chief financial officer, Gary Buettner.
Some RDA and DCIC members toured Dubuque's city-owned casino last month and heard presentations from Dubuque's city manager on the benefits of the city-owned Mystique Casino.
"We (RDA) need to meet, get more information, discuss this and get something decided," Ms. Bray said on Tuesday. "Some are getting tired of meeting. Some don't want to meet, but I assume we are all anxious to get this solved.
"I still feel we have not heard all of the information that would be helpful," she said. "Although RDA members are not elected to our position, I feel we have responsibility to the community to do our best work."
Mr. Lewis has expressed concern about the city's obligation of about $80 million if the project fails. RDA and DCIC member Christine Frederick has asked for another RDA meeting with more input from the community.
In January, she said she doesn't want the DCIC and RDA to sign the needed operator's contract for a new casino before knowing who will develop it.
Mr. Decker said by email on Tuesday the city is locked into the idea of full city ownership and wants a major portion of all profits (and losses), which he said puts taxpayers at risk.
On Dec. 20, three companies submitted proposals for land-based casinos. Of the three, the city agreed to work with Ingenus/Financial District Properties on a development agreement.
Ingenus/FDP proposed a $105 million project that would include a casino/hotel at the confluence of Interstates 80 and 280, and a smaller downtown casino next to the RiverCenter.
Mr. Decker said there could be more than three interested casino operators if the city would step out of the ownership and oversight role.
RDA president and DCIC member Mary Ellen Chamberlin said on Monday an RDA meeting has not been scheduled because it's difficult to get the board together because of conflicting schedules and work commitments.