Analyzing the Cedar Rapids casino analysts
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24 Hour Dorman
ALTOONA — Our Iowa Racing and Gaming Commission has six choices as it picks a company or companies to do a gambling market analysis, numbers likely to determine the ultimate fate of three Cedar Rapids casino proposals.
No biggie. Just all the marbles. Let’s meet our contestants.
You may remember Minneapolis-based Marquette Advisors and Union Gaming of Las Vegas. They conducted 2014 market studies showing a planned Cedar Crossing Casino in Cedar Rapids would cannibalize 70 to 80 percent of its annual revenue from existing casinos, in a saturated market. Those numbers scared the dickens out of commissioners, who voted 4-1 to deny a license.
“You’re familiar with our approach at this point,” Brent Wittenberg, Marquette’s vice president, to the commission on Tuesday. Yep.
White Sand Gaming, with offices in Atlantic City, London and Macau, is led by Saverio Scheri III, who has broad experience in gaming and accounting worlds. He once helped open the nation’s first racetrack casino. It happens to be Prairie Meadows, where Tuesday’s meeting was held.
“We have a pretty good understanding of this market,” Scheri said.
New Jersey-based Spectrum Gaming Group has done market impact studies and other gaming studies on behalf of several state and local governments, including the 2014 “Socioeconomic Impact of Gambling on Iowans.”
“A focus on integrity has allowed Spectrum to thrive,” raved “Inc.” magazine.
Strategic Economics Group is led by Iowa’s former state economist, Harvey Siegelman, and Mike Lipsman, a former top tax analyst at the Iowa Department of Revenue. They’ve done numerous economic impact studies in Iowa, including one on the craft beer industry.
And there’s Cedar Rapids’ own Annex Analytics, with offices in the Cherry Building. The firm doesn’t have gaming experience, but it has crunched numbers for numerous companies and nonprofits.
“To us, data is what we’re all about,” said Peggy Stover, president.
Any conflicts with local casino investors? “No,” Stover told the commission.
Tough choices. Do you go with old standbys, even though they significantly overestimated the cannibalization a new Jefferson casino would inflict upon its nearby competitors? Do you pick guys neck-deep in the gambling industry, or get a fresh outsider’s approach? Macau, Vegas or New Bohemia?
Most applicants touted Iowa experience. Marquette pointed to a close working relationship with Iowa casino operators. Union lauded its “rapport” with them. I know integrity and accuracy are these firms’ most valuable assets, but how close is too close when it’s in existing operators’ best interest to derail competition?
“To me, I think we need to get some new perspectives,” said Commission Chairman Rich Arnold. “The other firms that did it before, I think did a good job, but I think we need some new blood in there.”
I agree. If the commission wants its studies to be seen as truly independent, it needs to start fresh. More data, less friendly rapport. If not, it’s another signal Cedar Rapids’ casino chances remain slim.
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