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Riverboat casino legal battle in Sioux City finally ending

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Dakin Schultz (file photo)

The long legal battle between the nonprofit license holder Missouri River Historical Development (MHRD) and the company which operated the former Belle of Sioux City riverboat casino is now over.

The opposing sides have filed a joint dismissal of a lawsuit and counter lawsuit in Des Moines. MRHD President Dakin Schultz says his group is ready to put the dispute behind them. “We are pleased to see this legal battle come to an end. It gives MRHD and opportunity to continue focusing on making the lives better of the residents of Woodbury County,” Schultz says.

Penn National Gaming, which owned the Belle had sued MRHD for breach of contract in 2012, alleging that MRHD sought to replace the casino with another operator before their 20-year contract expired. Each side will pay for their own legal expenses. The lawsuits had been scheduled to go to trial next month, but Schultz says a May ruling found two issues with the Belle’s lawsuit and MRHD’s counter lawsuit.

The judge ruled MHRD had the right to look for a new casino operator, but the judge also dismissed the group’s counter claim. “It’s safe to say that’s what brought about the dismissal,” Schultz says. Penn National eventually lost out in its bid for a new land-based casino in Sioux City. MRHD now partners with Sioux City Entertainment, which won the land-based license and operates the Hard Rock Hotel and Casino.

(By Woody Gottburg, KSCJ, Sioux City)

 

This is ‘Responsible Gaming Week’ in Iowa

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Most people who visit Iowa’s 19 state-licensed casinos don’t suffer from gambling addiction, but for the few who do, those environments can be very detrimental.

This is Responsible Gaming Education Week in Iowa. Wes Ehrecke, president and CEO of the Iowa Gaming Association, says it’s a time to focus on educating casino employees and patrons.

“Well over 98% of people can go to the casino for the fun and entertainment it’s intended to be using their discretionary dollars,” Ehrecke says, “but for those that it might be a problem, we want to heighten awareness about resources that are available, gambling treatment counselors, 1-800-BETS OFF and other tools and resources they could explore if they’re experiencing a problem.”

Last year, significant changes were made to the voluntary self-exclusion program as a result of legislation passed in the Iowa legislature. This week, continued emphasis will help clarify and explain to patrons this reform that allows a person to voluntarily ban themselves for either five years or for life. Ehrecke credits the work of gambling treatment counselors at facilities near all 19 casinos.

“They are coming in to spend time, in some cases interacting with the patrons by setting up tables near the entrances,” Ehrecke says, “but especially with the employees to do staff training to better understand intervention skills and how to recognize if someone may be having a problem.” Ehrecke says there is a new online link that was created by the Iowa Department of Public Health and the Iowa Gambling Treatment Program for those who are in need of help.

“They have developed this new link called Your Life Iowa,” he says. “It’s not just gambling. It could be substance abuse. It could be mental health, various issues people might be experiencing and they have it all under one umbrella. YourLife.Iowa.org is a very helpful resource for people.”

There is also more information at www.iowagaming.org.

(By Pat Powers, KQWC, Webster City)

 

Attendance drops, but state casinos see a slight overall increase in yearly revenue

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Slot machines at the Hard Rock Casino in Sioux City.

The state-licensed casinos saw an overall increase in revenues despite a drop in the number of visitors by more than one-million for the fiscal year that ended June 30th.

Racing and Gaming Administrator Brian Ohorilko says the 19 casinos took in gross revenue of just under $1.5 billion. “Gross revenue for the year was up about $10 million. That is approximately point-seven percent, so not quite a percentage point,” Ohorilko says.

Ohorilko says with the lack of any major changes in facilities — it appears the casino market remains pretty stable. “This year there really wasn’t any material impact from new construction,” Ohorilko says. “The past few years different markets, different facilities had made capital improvements, and so you could typically tie some of the increased revenue to those areas.”

The number of people who went through the casino doors dropped again. “That’s a trend that has been a little bit discouraging,” according to Ohorilko. “I think this year they were down about one million people or about 5% year-over-year. And so, fewer people are coming — although they do appear to be spending a little bit more money while they are there.” Visitors to the casinos dropped from 21.8 million last fiscal year to 20.7 million this year. Overall Ohorilko says there are any big changes up or down.

“The past few years what we had experienced was significant growth in certain markets due to construction or just new amenities. And while one or two facilities carried the weight for the state, a number of the other markets were down,” Ohorilko says. “And this year that was not the case. We had nine facilities that were up year-over-year and 10 facilities that were down.”

The Prairie Meadows Racetrack and Casino in Altoona saw the largest increase — up 5.5% to just more than $201 million. The Hard Rock Casino in Sioux City saw a five percent increase to $80,911,617 million dollars. The Hard Rock has done some remodeling, but Ohorilko doesn’t know if that impacted numbers. “I’m not sure if all of those numbers can be attributed to that remodel, the remodel has been pretty recent. I know they have reemerged their base with some different marketing promotions,” he says. Ohorilko says the Hard Rock can take advantage of its amenities. He says they have an indoor/outdoor concert area that allows them to offer some unique concerts.

The Grand Falls Casino in Larchwood saw an increase earnings despite some very cold winter weather that impacted its operations. “Grand Falls was up about two-and-half percentage points from last year, given some of the bad weather. Their admissions were down about seven percentage points — so it is difficult to glean exactly some of those reasons why,” Ohorilko says.

Among the operations which saw a drop, the Casino Queen in Marquette lost more than $2.6 million in revenue from last year, while the Catfish Bend Casino in Burlington lost more than $2.5 million. The Lakeside Casino in Osceola saw a drop of a little more than two million dollars and the Isle Casino in Waterloo a little more than $1.8 million.

Here’s the 2018 fiscal year report: 2018-Casino-Revenue-PDF

 

Cedar Rapids store remains at the top of the Iowa Lottery’s sales list

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The Iowa Lottery had a record year in sales and the leading retailer is again in eastern Iowa.

“There is one particular Hy-Vee stored in Iowa that has been the lottery’s leading retailer in terms of sales for at least the last decade. And that store came out on top again this year,” according to Iowa Lottery spokesperson Mary Neubauer. The leading store is the Hy-Vee on Wilson Avenue in Cedar Rapids — which sold nearly 898-thousand dollars worth of lottery products.

“It’s in a really heavy residential area and it seems like everybody in that area shops at the store. And certainly while they are doing their other errands and buying groceries at the store, they also buy lottery tickets at that store. So, it was fun to see that store at the top of the list again,” Neubauer says.

Six other Cedar Rapids retailers were in the top ten for sales in the last fiscal year, with four of them connected to Hy-Vee, and the two others convenience stores. A Des Moines Hy-Vee store was number two on the list of sales — and was the only other retailer to crack $800,000 in sales ($815,175) A Hy-Vee in Council Bluffs was fifth on the list. The Pronto store in Denison was ninth on the list.

The Iowa Lottery introduced new touch-screen machines that sell scratch and lotto tickets to help deal with some of the lines in the busier store. Neubauer says they have proved to be popular.

“In the locations that they’re installed they are doing very, very well. They are adding to the sales in those places, and particularily, players seem to like to buy their Instaplay tickets through those machines,” according to Neubauer. “And so they are accomplishing what we wanted.” She says they only have 100 of the touch-screen machines across the state because of the cost.

“We hope that perhaps in the future just as technology becomes more affordable we can buy more of those machines. But for right now, they are in fairly limited locations,” Neubauer says. The Iowa Lottery had 371 million dollars in sales for the last fiscal year.

The Top 10 retailers in Iowa for lottery sales in FY 2018:

Retailer                       Address                                  City                             FY 2018 Sales

Hy-Vee                       20 Wilson Ave.                       Cedar Rapids              $897,463

Hy-Vee                       1843 Johnson Ave. NW          Cedar Rapids              $833,455

Hy-Vee                       2540 E. Euclid Ave.               Des Moines                 $815,175

Hy-Vee Gas                3935 Blairs Ferry Road NE    Cedar Rapids              $768,261

Hy-Vee                       2323 W. Broadway Ave.        Council Bluffs            $732,535

JJs on Johnson Ave.    235 Edgewood Road NW      Cedar Rapids              $701,439

Hy-Vee Drugstore      1520 6th St. SW                       Cedar Rapids              $675,484

Hy-Vee                       3235 Oakland Road NE          Cedar Rapids              $662,862

Pronto                         810 Fourth Ave. S.                  Denison                       $661,152

Hawkeye Conv. Store 2330 Wiley Blvd. SW             Cedar Rapids              $643,469

Final chapter of Waterloo Greyhound Park underway with demolition (video)

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Demolition is underway on Waterloo Greyhound Park.

Work got underway today to tear down the abandoned greyhound track that has been an eyesore on the south side of Waterloo along Highway 20 for more than three decades.

Waterloo Mayor Quentin Hart grabbed a sledgehammer and took the first symbolic hit on the dilapidated structure. “And I swung so hard I probably took about two years off my life,” Quentin says with a laugh, ” but it was great. And right after I did the sledgehammer, they started with the backhoe to start tearing it down.”

The Waterloo Greyhound Park opened in 1986, but after a few years of operation fell victim to the competition of casino operations and shut down in 1993. Legal disputes kept the track from every operating again and through the years it was vandalized and became rundown.

Mayor Hart says getting rid of the old track was one of the top questions he got during his campaign — and he is glad it is finally happening. “The fact that that sits right near the intersections of Highway 20 and 218 — to have that be what people see the first thing about our community is not great. And just to see all the change and growth has been tremendous,” Hart says.

Trees grown up around the track.

The Meskwaki Nation lent money to the National Cattle Congress to try and bail them out of bankruptcy and eventually foreclosed on the property in 1996. Which kept the property tied up in legal issues. Local developer Harold Yungblunt eventually work through all the past issues and reached a deal to buy the property and redevelop it.

“And probably the best thing for it is we didn’t get in it, the city, they were able to work it out and come up with I guess a win-win scenario for all parties involved,” Hart says. Hart says the redevelopment of the Greyhound Park land continues the work that has already been done in the area.

“On the north side of (Highway) 63 near the Logan Plaza area, we’ve been able to see the resurrection of a new medical center, and the city has land that will be available for new development opportunities,” according to Hart. “So, seeing that whole 63 corridor and TechWorks and the new buildings — man there is a new vein going through Waterloo that is showing tremendous potential.”

Hart says the demolition of the track buildings is expected to take around ten days and there should be new commercial development built in the area within the next year.

Here’s a video of the track before demolitions started:

 

 

(Photos and video courtesy of Elwin Huffman, KOEL, Oelwein)

Scratch tickets continue to anchor sales in record year for Iowa Lottery

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The Iowa Lottery scratched out a record in sales for the fiscal year that ended June 30th.

Lottery spokesperson Mary Neubauer says total sales were $371 million — and the $87.1 million that’ll go to the state is the second highest amount every produced. Neubauer says the first product ever sold by the Iowa Lottery continues to be the steady driver in sales.

“Scratch ticket sales have done well in Iowa for the last several years and this last year they again set a record, and that then propelled the lottery to the really strong results that we had,” Neubauer says. It is the fourth straight year scratch tickets have set a record for sales and their sales have increased by 89% from 2007 to 2017. Big jackpots in lotto games can give the Iowa Lottery’s bottom line a boost — but those are unpredictable — while the scratch tickets continue to be a steady source of income.

“They have a smaller profit percentage overall than does a game like Powerball or Mega Millions. So, the overall profit percentage may be a little smaller when scratch tickets lead the way,” Neubauer says, “but again you’re going to be talking about bigger sales in total. So, it was just a lot of positives for us. And then the other number I haven’t mentioned, is that with record sales comes record prizes to players.” The Iowa Lottery paid out nearly $228 million in prizes in the fiscal year.

Mary Neubauer

Another difference between the lotto games and the scratch tickets is the variety of choices in scratch tickets. For lotto games you select your favorite numbers and play — while Neubauer says they are constantly changing the types of scratch tickets available.

“One of the games that we had on the market this last year was a Frogger game and that really hit the nostalgia mark with our players and Frogger was one of our best selling games for the year,” according to Neubauer. “So we put a lot of thought into it, and I’m really happy to see that reflected in the numbers.”

Another boost for scratch ticket sales came with a stable gas prices.

“In the past when gas prices have really spiked, we see almost an immediate impact on lottery sales,” Neubauer explains. “And over the last year gas prices have been fairly stable — or they have even trended down some.” Scratch tickets are sold at dozens of convenience stores across the state, and Neubauer says lower gas prices seem to free up a little extra cash after people fill up.

“I think the consumer really feels that at the gas pump. They have a few extra dollars in their pocket and they can do things like buy a sandwich or buy a soda or buy a lottery ticket. So, we think that was part of the picture this past year as well,” Neubauer says. Total sales exceeded 300 million dollars for the seventh year in a row. It is the fifth time the proceeds to the state have exceeded $80 million in the Iowa Lottery’s 33-year history.

The largest prize won in Iowa was a $4.38 million dollar Lotto America jackpot. Four other Iowa tickets won prizes of one million dollars during the year, including a Powerball ticket purchased in Nevada for the April 11th drawing that remains unclaimed.

 

American Gaming Association study finds $2.5 billion casino impact on state

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American Gaming Association information on gambling in Iowa.

A report by the American Gaming Association finds the impact of the 19 state-licensed casinos is bigger than previously estimates. Iowa Gaming Association president, Wes Ehrecke says the AGA report looked at the job and dollar impact of the casinos.

“The ripple affect with the support that they have for a lot of the small businesses, the non-profits and more — they estimated that job support at about 15,660. And total economic impact of $2.5 billion,”Ehrecke says. He says his organizaton had estimated the impact on the state at one billion dollars.

The AGA report shows the impact of casinos was found to be widespread. “The support not only in charitable contributions — but often times the volunteer efforts of casino employees — as well as just the presence of having so many sponsorships and other ways that they support the community,”Ehrecke says. Ehrecke says the casino industry has come a long way in the state.

“It was difficult to imagine by anyone 27 years ago when the first riverboat casinos in the country opened up on April 1st 1991. Today now we have 19 commercial casinos that are by design and encouragement by our regulators to be premiere entertainment destinations,” Ehrecke says. He says the amenities that go along with the casinos are part of the big impact they have on communities.

“Most have some form of dinning and lodging and in some cases, golf courses, bowling alleys, spas and other entertainment entities that really make these worthwhile attractions,” according to Ehrecke. “Plus the meeting space, the concert venues that make it a really the cornerstone of any community in any region.”

Ehrecke says the casinos also take the concern of those who might develop a gambling problem very seriously. He says the gaming industry has always been at the forefront of responsible gaming and he says for the gaming industry the number of problem gamblers has held around one-percent. Ehrecke says they fund and encourage those with a problem to call the gambling addiction help line. The AGA survey looked across the gambling facilities in Iowa, with a special focus on the impact of the casinos in Dubuque and Council Bluffs.

The study was released as a part of its “getting to know gambling” campaign.

 

Racing and Gaming regulators preparing for possible sports gambling

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Iowa Racing and Gaming Commission administrator Brian Ohorilko says the organization is ready for whatever sports betting might bring to it. He says they’ve already been watching and researching the issue of sports gambling.

“We’ve been doing this actually for a number of years with fantasy sports — which had been discussed three to four years ago — and that has transitioned obviously with the latest Supreme Court ruling into just traditional sports wagering,” Ohorilkoh says. The U.S. Supreme Court ruling allows all states to permit sports betting. Ohorilko says the casino operators have also been researching sports betting.

“There’s definitely a lot of energy and excitement from the operators and that requires the commission to make sure that we are aware of all of the issues related to sports wagering,” Ohorilko says, “and the commission would be prepared if we the legislature were to ask the commission to assist with the regulation of that.”

He says they should be able to handle the additional duties of regulating sports betting.

“Our role would be quite extensive up front. Drafting rules, getting regs in place. But once that is in place, then I think the day-to-day regulation would certainly be manageable and there wouldn’t be a need for much additional staff,” according to Ohorilko. He says the will only play a supporting role after the decision is made.

“With sports wagering the commission has not position — but we will be ready to carry out whatever the legislature asks us to do,” he says. The casino industry which the IRGC regulates has been lobbying legislators to let state-licensed casinos run sports book operations . The Iowa Lottery’s board of directors is also having its staff research how a sports lottery might work here. Iowa Lottery officials say several of the lottery’s largest retailers have said that if sports betting becomes legal in Iowa, they want the option of offering it in their stores.

 

Burlington casino pays $20,000 state penalty after tax reporting error

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Brian Ohorilko.

The Iowa Racing and Gaming Commission approved a fine of $20,000 today for the Catfish Bend Casino in Burlington for an error in gambling tax reporting.

Racing and Gaming administrator Brian Ohorilko says the problem involved how free plays given to casino customers are taxed after the state law was changed two years ago.

“It exempted certain types of promotional play from state tax after a certain number of promotional play has been issued throughout the entire state of Iowa,” Ohorilko says. He says Catfish Bend was giving customers free plays after they paid a certain amount of cash and then they counted those free plays against the statewide tax limit.

“They were including that in the overall formula — it should not have been included in that formula — and so what it did was, it cause that threshold where taxes did not need to be paid for promotional pay to be hit a few weeks earlier than it should have,” according to Ohorilko. Ohorilko says they had to collect gambling taxes from casinos to make up for the mistake.

“It was approximately $250,000 in state gaming taxes that was collected over the course of two years,” Ohorilko says. Ohorilko says the taxing of free play in casinos is done by some states and some states do not tax it. Other states tax are like Iowa and only tax a portion of the free play. Ohorilko says free plays are legal and are one of the incentives the casinos use.

“Free play is very common throughout the industry. It’s issued to slot players, typically based on their play. It’s loaded onto their players club account and it’s typically played through slot machines,” Ohorilko says, “so, it’s very common and it’s a tool used in Iowa and other jurisdictions.”

The Catfish Bend fine also involved the use of credit cards to purchase credit.  The general manager of the casino says that mistakenly happened when customers purchased a casino package and paid for it with a credit card. The Racing and Gaming Commission took action on the issue at its monthly meeting at the Prairie Meadows Racetrack and Casino in Altoona.

 

Iowa Lottery’s Board of Directors discusses sports betting after court ruling

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Iowa Lottery Board

The five-member board that oversees the Iowa Lottery has directed lottery staff to “explore…the feasibility” of having Iowa retailers use lottery terminals for sports betting.

Sports betting has been legal in the State of Nevada for decades, but a U.S. Supreme Court ruling in May overturned a federal law which had prohibited legalized sports betting in other states. On June 5, Delaware began offering full-scale sports betting in casinos along with a more limited sports lottery in retail locations.

“In the last month, we’ve heard from several of the lottery’s largest retail organizations who have said that if sports betting is legalized in Iowa, they want the option of offering it as a product in their locations,” Neubauer said today during the lottery board’s meeting.

Mary Neubauer

Scientific Games, the company that helps run Delaware’s sports lottery, also has the service contract for Iowa Lottery terminals that handle play slips and print lottery tickets.

“Given the expertise involved, we fully anticipate that our current system provider could allow the Iowa Lottery to offer sports betting,” Neubauer said. “Ultimately, the decision as to whether sports betting will be legalized in Iowa and exactly what sports betting were to look like if that were to occur here is a decision for our state’s lawmakers.”

The casino industry has been lobbying Iowa legislators for several years to pass a bill that would allow sports betting run by the state’s casinos, if the court ruled states could proceed. Mary Rathje of Marion, a member of the Iowa Lottery’s board, said Iowa Lottery retailers “need to be represented,” too, and that’s why lottery staff need to continue doing the research about how a sports lottery could work here.

Rob Porter

“The casinos, I’m sure, have already got their scope and how they want to proceed with this and we need to be able to be on the same page, if and when it’s decided,” Rathje said during today’s board meeting.

Rob Porter, the Iowa Lottery’s legal counsel, said the businesses that sell Iowa lottery products are looking for ways to boost in-store traffic as consumers shift more of their purchases online.

“One of the things that has the most interest for our retailers is if individuals had a convenient option to place legal bets, it certainly would drive traffic to their store, especially in rural locations,” Porter said, “and the potential for economic development and additional traffic in the store is something that helps them and, by extension, helps us.”

Iowa Lottery officials will not lobby legislators to approve a sports lottery option, but have been directed by the board to research, monitor and prepare for a state law that might involve the lottery in sports betting.

A sports lottery would not be a big revenue producer for the state. Lottery officials predict is would yield between $1 million and $6 million annually. Last fiscal year, the Iowa Lottery generated nearly $81 million in revenue for the state.