What's Next for Proposed Cedar Rapids Casino?
By Rick Smith, Reporter
CEDAR RAPIDS, Iowa — Casino investor Steve Gray said Tuesday that it will take four to six months for the investor group to complete work required to submit an application to the Iowa Racing & Gaming Commission. From there, he estimated that the commission would take six to 12 months to study the application before it decides if it will grant a state gaming license for a Cedar Rapids casino.
Immediately, Gray said the investors will invest “some real money” in pre-construction engineering and design work to create a site plan for the new casino.
The casino site as now envisioned, he said, will be comprised of about seven acres of property — the 3.5-acre, pie-shaped piece of property between the south side of Interstate 380 and First Avenue NW, and nearly all of the two city blocks across First Avenue West, between First and Second avenues SW and First and Third streets SW. The casino building will sit between First and Second avenues SW.
Close to six of the seven acres is owned by the city, which obtained it through the federally funded, flood-recovery buyout program. The investors, Gray added, have signed contracts to purchase the rest, and have an interest in buying one final piece of property still in private hands.
In short order, he said the casino investors will ask the city to make its nearly six acres of buyout property available for sale, a request that will prompt “our public property disposition process” that the city has used several times in recent years, Mayor Ron Corbett said on Tuesday.
Corbett said the city will seek proposals from all comers for the land that the casino identifies. The city then will select the proposals that meet the city’s minimum appraisal price and best meet the city’s goals for the property — such as jobs, revenue from property taxes and the potential to spur additional economic development. In this instance, the city has said it wants to see which proposal might help drive business to the city-owned hotel and provide business for the city-owned convention center.
Corbett said the process is no different from the one the city used to sell Riverside Park next to the Penford Products Co. plant for the plant’s future expansion.
Corbett envisioned that any development agreement with the casino investors would be conditioned on the investors’ securing a state gaming license. The agreement will deal with the details of putting a casino on a piece of city property and how it impacts streets, sewers and other infrastructure, he said.
Gray said the development agreement needs to be in place before the casino investors finish their application to the state commission.
In the meantime, he said the investors need to hire a manager or entity to run the casino; finalize the casino design; and secure $100 million in financing. The investors will provide $25 million to $30 million of the total, Gray said. He said that $85 million is to build the casino, $12 million is for three state license payments before a casino opens (two others will come after it opens) and $3 million is for a project contingency fund.
Under the best scenario, Gray said the investors would have the state application complete and in front of the commission sometime between July and September.
The City Council and the Linn County Board of Supervisors have said they will support the Gray-led investors in front of the state commission if the investors succeeded to get the casino question to voters and got the ballot measure passed.
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