Iowa gambling regulators signal they won't consider new casino licenses for 3 years



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JOHNSTON, Iowa — Members of the commission that oversees casino licenses in Iowa said Thursday they will not consider new license proposals for three years, but the panel stopped short of voting to impose a formal moratorium.

The commission's five members agreed that they want to see three new casino projects now in the works reach completion and begin operating before they consider any further proposals.

The newly built Hard Rock Casino in Sioux City opens Friday, and construction is beginning on a Jefferson casino approved in June that is expected to open in a year. The Isle of Capri Casinos is selling its riverboat casino in Davenport to a developer who is planning a $110 million land-based casino development near Interstate 80 to replace the boat.

"As far as I'm concerned for the remainder of my term on the commission, which is approximately three years, I really have very little desire to consider any new license applications within that period of time," said Chairman Jeff Lamberti. "I simply don't see a set of circumstances that's likely to change my mind, particularly with these new facilities coming on board within the next few years."

The Jefferson casino will be the state's 19th state-regulated gambling parlor. Iowa also has three casinos operated by American Indian tribes.

In April the commission rejected a proposal from Cedar Rapids, saying it would take too much revenue from existing casinos. The commission cited two recent studies it had ordered from consultants that found Iowa's gambling market to be saturated with so many casinos that new ones would simply snag customers from existing operations and reduce their revenue.

The Jefferson casino was found to have far less impact on others, although it still is estimated to cannibalize about $30 million a year.

Lamberti said no formal vote was taken on a moratorium because that process requires the issue to go before a legislative committee and once approved would allow no new licenses to be accepted until it's repealed. He favored an informal declaration that gives the commission flexibility to react to unforeseen market changes while still sending a message discouraging new license applications.

He said, for example, if Nebraska expands gambling it might be significant enough to cause the commission to reconsider.

Nearly one-fourth of Iowa's casino revenue comes from Nebraskans, who mostly visit casinos along the Missouri River. Nebraska's constitution forbids casino gambling, and recent attempts to place the issue on the ballot have failed in the state Legislature. Some lawmakers, however, are determined to keep trying.

Efforts to expand gambling in Illinois across the Mississippi River from Iowa create additional potential competition. A bill proposing more casinos died in May, but its backer says he'll try again this fall.

Iowa gaming Commissioner Dolores Mertz agreed with Lamberti but said the commission should continue to consider a changing gambling environment and the economy.

"I wouldn't want to say an outright no to anyone," she said. "I do think we have to look at all those things but I do think we have to keep an open mind to whatever comes before us."

Commissioner Kris Kramer said she's concerned that Iowa is saturated with casinos as market studies show and she doesn't want to see a situation that's developed in other states where casinos are closing.

With 3.1 million people, Iowa has 18,000 slot machines and about 470 tables for poker and other games at the existing 18 state-run casinos. Iowa allows one of the widest ranges of legalized gambling choices among 41 states with casinos, including charitable gaming, pari-mutuel wagering, lotteries, commercial casinos, Indian casinos, dog racing casinos and a horse racing casino.

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