Iowa gaming regulators ‘disappointed’ in casino moratorium

After state lawmakers last week passed a last-minute two-year moratorium on new casino licenses, state gaming regulators on Thursday voiced concern the move would introduce politics into Iowa’s gaming operations.

But members of the Iowa Racing and Gaming Commission opted to wait to see if Iowa Gov. Kim Reynolds signs the bill before deciding what’s next for a Linn County casino application.

Commissioner Lance Horbach, a former Republican lawmaker from Tama, said the point of commissions is to keep politics out of decisions.

“My concern is if this is signed, politics is now in Iowa’s gaming industry,” Horbach said, according to audio of the commission’s meeting at Wild Rose Casino and Hotel in Emmetsburg, provided by PlayIA.com.

He referenced judicial appointments as an example, noting lawmakers do not select nominees so that donors and other interests do not get special preference in the appointment process.

The point of having an independent commission, he said, is to keep politics, money and influence away from regulating Iowa casinos, he said.

If the legislative moratorium is enacted retroactively from June 1 through June 30, 2024, state lawmakers will face another decision in two years on whether to extend the moratorium, Horbach said.

“I do have some concern about the impact on the commission process in the state of Iowa,” Horbach said.

‘Surprised’

Commissioner Mark Campbell, a Fort Dodge Democrat, said he thought he and other commissioners “were all surprised” by the legislative action.

“We value the integrity of the process, and I think this commission values that and is going to work extremely hard to maintain that in the process of licensing regulating and how we move forward,” Campbell said.

Commissioner Daryl Olsen, a Republican from Audubon, said commissioners were “surprised” and “disappointed” with the moratorium.

The commission, he said, spends time and energy to understand every gaming topic and witnesses the process of awarding a gaming license from beginning to end so its decisions are sound.

“I truly believe these decisions should stay at the level of the commission, but our job is to regulate and not legislate, so we will continue to regulate,” Olsen said.

Commissioner Amy Burkhart, a registered independent from Burlington, said the bill showed the need for good communication to maintain integrity and transparency in regulating Iowa’s licensed gaming facilities.

“We think that’s in the best interest in the future of gaming in Iowa,” Burkhart said.

Up to Reynolds

Reynolds has not publicly indicated whether she will sign the bill, saying she has 30 days after the legislative session to review bills with her staff and make a decision.

Sen. Roby Smith, R-Davenport, ran the moratorium amendment through the Legislature. He and other GOP leaders, including Reynolds, have received campaign contributions from Dan Kehl, the CEO of the company that operates casinos in Riverside and Davenport and a vocal opponent of a Cedar Rapids casino.

Backers of a Cedar Rapids casino went forward Sunday with unveiling their plans for Cedar Crossing, a $250 million, 160,000 square-foot entertainment and cultural arts complex on the site of now-demolished Cooper’s Mill on F Avenue NW, just off Interstate 380 and close to downtown.

Mayor asks for veto

Cedar Rapids Mayor Tiffany O’Donnell on Thursday sent a letter to Reynolds, asking her to veto the bill.

Iowa’s gaming industry, she wrote, has evolved under regulation of the commission. Its processes require “continual oversight, review and assessment of gaming trends within our borders as well as trends from neighboring states.”

“The best course for Iowa is to keep gaming decisions under the purview” of the Iowa Racing and Gaming Commission, O’Donnell stated. “They are best suited to determine the appropriate path forward for our gaming industry.”

The mayor also noted Iowa Senate Majority Leader Jack Whitver’s statement on Iowa PBS’ “Iowa Press” that lawmakers discussed this issue for “probably 20 seconds,” which O’Donnell speculated was unlikely to take into account the area’s growth.

The legislation also does not take into account findings from gaming panel-commissioned studies showing the threat Nebraska gaming expansions pose to Iowa gaming revenues and the net revenue gain of more than $50 million from a Linn County casino.

“Given that the amended bill was filed and passed both chambers in a matter of hours, the city and (the Iowa Racing and Gaming Commission) were unable to share this critically important information with the legislature,” O’Donnell wrote.

Jonathan Swain, president of Peninsula Pacific Entertainment, the city’s preferred casino operator, previously said the Cedar Crossing team would remain committed to Cedar Rapids and Linn County, regardless of what happens on the moratorium.

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