Archive for Thursday, April 16, 2009

First state-owned casino will open as scheduled in November

April 16, 2009

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— Boot Hill Casino and Resort will open as planned in November after Kansas regulators made it easier to buy slot machines and other gambling equipment, its operators said Thursday.

Dodge City is the only one of four locations in which construction on a state-owned casino is moving forward after being authorized by a 2007 law. Its operators were worried about not being able to get machines until the executive director of the Kansas Racing and Gaming Commission acted a week ago.

“Thanks to the executive director’s action, it looks like the vendors are showing up. We’re happy we have vendors wanting to sell us equipment,” Clark Stewart, president of Butler National Service Corp., of Olathe, told the commission.

The law says anybody with a 0.5 percent ownership in an equipment company must undergo a background check, but it also gives the commission discretion to accept other states’ background approvals.

Such a small ownership percentage is well below the industry standard and makes background checks difficult and time-consuming.

Executive Director Stephen Martino issued a directive allowing a company to get a temporary permit to sell in Kansas if approved by regulators in Illinois, Indiana, Iowa, Missouri and New Jersey. He also required the company to pass a Kansas background check before getting a permanent certificate, which would be renewable every two years.

Stewart said before the directive, vendors wouldn’t talk to Boot Hill for fear of getting in trouble with the state, which could cause them problems in other states.

“We’re happy the suppliers are happy and we’ve gotten signals they are in the process of filing,” he said.

He said construction of the $88 million complex is two weeks behind schedule. He said work slowed at the request of lenders because the casino couldn’t order its gambling equipment. But he said the casino will open as planned in mid-November.

Martino said the commission hasn’t received any applications from vendors yet, adding, “We’ve done everything we can do.”

Project Director Doug Smith said the first phase will include a casino with 875 slots and food service with a 124-room hotel with amenities completed in 2012.

Smith said the 60,000-square-foot casino will be enclosed next week, allowing exterior and interior work to begin. He said workers will make up the lost time during the summer.

The 2007 law authorized four state-owned casinos, one each in Ford, Sumner and Wyandotte counties and either Cherokee or Crawford counties. Boot Hill has a 15-year operating contract with the Kansas Lottery, which owns the gambling.

After the economic collapse last year, Harrah’s Entertainment Inc., of Las Vegas, pulled out of Sumner County and a partnership of Kansas Speedway and Baltimore-based Cordish Co., withdrew its Wyandotte County application with plans to refile.

The Lottery reopened bidding, and by the April 1, there were three applicants for Wyandotte, including the speedway, and three competitors for Sumner County, including some of the same investors aligned with Harrah’s.

The Lottery can negotiate as many contracts as it wants and send them to a review board for final selection, subject to commission approval.

“Most have toned down their structures a bit,” said Keith Kocher, the Lottery’s director of gaming. “We’ll have good contracts. Most of these players know what we will do and won’t do.”

In southeast Kansas, it’s a different story. Penn National Gaming Inc. pulled out of Cherokee County in September, saying it couldn’t compete with a nearby $300 million Oklahoma tribal casino. The Wyomissing, Pa., company now is bidding for Wyandotte County.

The Lottery extended the deadline once to next Tuesday and plans to extend it to July 20 if there are no bidders next week.

“We’ve had people nibbling, but I can’t tell you we’ll have applications,” Kocher said. “I’m moderately hopeful we’ll have an application or two, but we’ll see.”

The problem is the required minimum investment of $250 million, with the tribal casino across the state line. There’s been legislation to lower that amount, but it has little chance of it passing.

Comments

frankfussman 6 years, 3 months ago

...just what we need... more gambling -- and gambling addiction -- in Kansas, when people are already in financial trouble. This can't be a good thing.

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