Cedar Rapids’ casino dreams won’t die

Despite a deck stacked against them, Cedar Rapids casino backers refuse to fold.

Thus ends the obligatory gambling metaphor.

On Tuesday, the Cedar Rapids City Council set a public hearing date for a deal that would allow the Cedar Rapids Development Group, also known as local casino investors, to lock up land on the northwest side near downtown for a future casino. They’ve proposed paying the city $155,000 for an option to buy the land by the end of 2025 and would pay another $55,000 to put a hold on the site through 2026.

At a minimum, the investors, should they get a license from the Iowa Racing and Gaming Commission, would be expected to invest $150 million on a 125,000 square-foot casino, restaurants and other amenities and 1,500 parking spots. A year ago, investors unveiled a $250 million, 160,000 square-foot casino plan at the same site.

Council members asked a few questions, and voted in 5-1 in favor of setting a hearing,

But the biggest question remains. Will Cedar Rapids ever get a green light from the state for a casino?

Investors, of course, say they are optimistic. Some of them have been on this quest for a decade. They have endeavored to persevere.

Sadly, I don’t share their optimism.

First, there’s the Legislature, which last year voted to place a two-year moratorium on new gambling licenses. Gov. Kim Reynolds, despite pleas from her friend Mayor Tiffany O’Donnell, signed it into law.

It was an unprecedented move from lawmakers, who have traditionally left the fate of new casino plans in the hands of the Racing and Gaming Commission. Now that the Legislature has crossed that line, I expect them to extend the moratorium next year.

The existing casino lobby wants it, and it usually gets what it wants. Then you’ve got a block of lawmakers who represent counties with existing casinos who support a moratorium. Toss in some religious conservatives who oppose gambling and some horse-traders who will vote for a moratorium in exchange for something else, and you’ve got a coalition that’s tough to beat.

OK, so maybe the Legislature doesn’t extend the moratorium. Cedar Rapids casino advocates will need to convince the Racing and Gaming Commission to grant them a license. They’ve failed twice before, but current commission members haven’t heard a Cedar Rapids casino pitch. Maybe the commission will be persuaded to let Cedar Rapids join the casino cartel. Or maybe not.

There will be another round of market analysis. And that analysis is likely to show a Cedar Rapids casino will take business away from existing casinos. That dreaded “cannibalization” is what sank previous Cedar Rapids casino bids after market studies found it would take considerable business away from casinos in Riverside and Waterloo.

Statewide gambling revenues are taking a hit from new casinos in Nebraska, and a Cedar Rapids casino could bring in new bucks. But the commission has always focused on protecting individual casinos from competition, not boosting state revenue.

So Cedar Rapids investors face long odds, but they’re willing to put $155,000 more into the pot. Good luck to them.

(319) 398-8262; todd.dorman@thegazette.com