Must a casino come to pass right here, it is going to join a casino sector in Iowa that is now a generation old, is called stable and mature and has observed its general business enterprise efficiency languish for substantially of your final 5 years.
Overall admissions at Iowa’s now-18 state-licensed gaming venues are off 3.8 % for the five-year period ending June 30, 2012, whilst the 3.six % boost in adjusted gross revenue has not kept up with inflation. The final year on the period was far better, with admissions up five.two percent and income up 6.3 percent, helped by the opening in the state’s 18th casino in far northwest Iowa.
Numbers aside, it is not industry which is standing nevertheless. Actually, it’s within the midst of slightly drama – even without having the March 5 referendum set in Linn County to see if voters help a casino, and then, if they do, to see in the event the Iowa Racing & Gaming Commission will grant the state’s nineteenth gaming license over the protests of nearby casino owners.
Currently, in Davenport, city officials are looking to buy the riverboat casino operation there and, sorting through three different plans, to build a casino with an assortment of new features at a site away from the Mississippi River.
“We want to go from third place,” explains Mary Ellen Chamberlain, longtime president with the non-profit Riverboat Development Authority in Davenport, noting that the casino next door in Bettendorf and the one across the river in Rock Island, Ill., outpace the Rhythm City riverboat casino in Davenport both in revenue and admissions.
Equally interesting is the hullabaloo across the state in Sioux City, where Missouri River Historical Development Inc. – a non-profit entity like Chamberlain’s group in Davenport that under Iowa law holds the local gaming license and dispenses a portion of gaming income into the community – decided it, too, wanted a new casino that offered more than gaming at a spot away from the river. Three firms with four proposals and three different non-profit boards of directors are now vying for Sioux City’s gaming business in front with the Iowa Racing & Gaming Commission.
“It’s a very American concept – competition – and I love it,” explains Mark Monson, chairman of Missouri River Historical Development Inc.’s board of directors and a Woodbury County supervisor.
Brian Ohorilko, administrator for the Iowa Racing & Gaming Commission, says the Davenport and Sioux City casino developments are uncharted water for the commission when it comes to the state’s 15 state-licensed casinos with out race tracks that started out as riverboat casinos. No city has owned any from the 15, so the Davenport debate for the commission is “sort of a shift in policy,” he says. As for the Sioux City situation, no non-profit license holder has ever refused to renew its contract with the casino operator, he adds.
Ohorilko, too, is well aware on the casino effort in Linn County, but he says for now, he and the commission members are simply “observers,” waiting to see if Linn County voters decide to approve gaming on March 5. If they do, casino developers will file an application with the state commission after which see what happens. The commission, he notes, said in 2010 that it wanted to wait three to 5 years before it considered any new casino licenses in a state that it determined in 2010 might be reaching the saturation point for casinos.
Even with the developments in Cedar Rapids, Davenport and Sioux City, Ohorilko says the best words to describe the income from Iowa’s casino sector are “pretty stable” and “pretty predictable.”
“We did see some impact from the recession, but certainly we didn’t see the impact that the markets in Nevada and New Jersey witnessed,” he says. “The past few years, income really has been mostly flat, give or take a few points.”
Wes Ehrecke, who has been president in the Iowa Gaming Association since 2000, sees Iowa’s casino business of late in similar fashion, saying economic slowdowns hurt entertainment businesses like casinos because they depend on people spending their discretionary income and not tightening their belts. As a result, the casino company general in Iowa has been “relatively flat,” he says.
“But I don’t think anybody’s going to close their doors,” Ehrecke adds. “No one is on that kind of shaky ground. But every day you got to be competitive. People have choices, and you have to earn (their business).”
The Iowa Legislature changed state law in 2007 and allowed casinos that had been required to be on or at a body of water to leave the water and build a new facility away from it.
Both Ohorilko and Ehrecke say the Diamond Jo Casino in Dubuque, the Wild Rose Casino and Resort in Clinton and the Catfish Bend Casino in Burlington all have shifted to new land-based venues with added amenities, moves they say have been of benefit. That may be particularly so for the Dubuque and Clinton casinos, which lead the state’s 18 gaming venues over the final 5 years in percentage growth in revenue and admissions.
Ehrecke says that Iowa’s casino industry provides an annual economic impact to the state that has been hovering around $1 billion a year, a figure that includes employee wages and benefits, the purchase of Iowa products, charitable contributions and taxes paid to the state, cities and counties.
At one point, he says the business eclipsed the $1 billion annual figure, and more recently has dipped below it a little bit.
“We’re a maturing, stable and significant sector,” he says. “It’s a pretty viable part of Iowa’s economy, adding a lot to the state and to the state’s tourism industries.”
The Iowa Racing & Gaming Commission has approved licenses for 5 new casinos that have opened up since 2006 – at Riverside, Waterloo, Emmetsburg, in Worth County along Interstate 35 near the Minnesota border and in Lyon County in far northwest Iowa near Sioux Falls, S.D.
It was at the same meeting at which it granted the license in 2010 to Lyon County, that the Iowa Racing & Gaming Commission said it wanted to take a break from any more casinos.
These days, Tim Hurley, who was mayor of Waterloo and helped help the effort to bring the Isle Casino Hotel Waterloo to the city in 2007, says he is keeping an eye on the casino developments an hour south along the Interstate 380 corridor in Cedar Rapids.
“We’re going to remain vigilant, we’re staying informed,” says Hurley, who is the chairman from the non-profit Black Hawk Gaming Association, which holds the state gaming license and dispenses gaming income into the Waterloo area. “One should really be concerned if the market is saturated within the corridor, let alone inside the state of Iowa.”
Chamberlain, the chairwoman in the non-profit Riverboat Development Authority in Davenport, has been with the non-profit since its formative period before the Davenport riverboat casino opening on April 1, 1991. Riverboat casinos in Bettendorf and Dubuque opened the same day, launching the state’s riverboat casino era.
Chamberlain says the Davenport casino has been inside the center of casino competition for years – casinos in Bettendorf, Clinton, Riverside and Rock Island, Ill., are all within 50 miles, she notes – and her take is that every casino in Iowa has a potential of taking some of another casino’s business.
“Riverside took a chunk out of us,” she says of your Riverside Casino and Golf Resort, which opened in September 2006 south of Iowa City.
Davenport, she says, now is going to take a page from the playbooks in the Diamond Jo Casino in Dubuque and the Wild Rose Casino & Resort in Clinton and move its casino off the Mississippi River and add some amenities to it. The move, she says, ought to help a new land-based Davenport casino grab some of what she says is the higher-end casino crowd that goes to the Isle Casino Hotel Bettendorf and the party crowd that she says is attracted to Jumer’s Casino & Hotel in Rock Island, Ill., across the river from Davenport.
“We hope the new casino will be class act,” says Chamberlain. “Our goal is to attract at least a third in the market, and more if we can. That’s what the city and everybody else in Davenport is working to make happen.”