Even with influentual backers, Cedar Crossing’s fate still relies more on its future and features than its friends

One argument I've heard throughout our long local casino odyssey is that investors pursuing a state gaming license for a Cedar Rapids casino are so influential it's a done deal.

Cannibalization? Saturation? Forget about ‘em. These heavy hitters wouldn't have thrown in on this thing if it wasn't going to happen. Bet the farm on Cedar Crossing.

I've heard this from many readers, some of which argue that I've been naive to think for one second this is actually a tough call that hasn't been decided.

It's true, I've been skeptical of those arguments. After witnessing past licensing decisions, I think the merits of the Cedar Crossing project, its potential effects on existing nearby casinos and the overall Iowa gambling market will be the biggest deciding factors. I still believe that, and I think the five-member Racing and Gaming Commission is wrestling with those issues ahead of its final vote on Thursday. That wrestling may continue until the last minute.

And although it is easy to point to the role of 'influence,” it's tough to definitively quantify it, or the actual effect it has on a decision like this one. Sure, Cedar Rapids Mayor Ron Corbett served in the Legislature with three members of the commission. But will that mean anything when the roll call goes down on Thursday?

Campaign contributions are one way we in the media try to measure influence. The more you give to a cause or candidate, the logic goes, the more influence you may have.

Trouble is, racing and gaming commissioners are not candidates who get contributions. But every member of the current commission was appointed by Gov. Terry Branstad, who is a candidate for re-election and is seeking contributions. His website is standing by, in case you're feeling generous.

But Branstad has pledged, repeatedly, to stay out of the Cedar Rapids casino debate and not seek to influence the commission.

'My responsibility is to appoint good people who are fair and will treat everybody in an equitable way,” Branstad said in February. 'That's the way I've always approached it. I have never tried to influence or interfere with their decision-making process and I have confidence they will do what they feel is the appropriate thing.”

There's no evidence to suggest that's not the case. And I believe Branstad because staying out of decisions like this is good politics. There's really no upside to wading in. This governor suddenly has 99 problems, but the casino debate isn't one.

But it is true that some of Branstad's top allies are hardly staying neutral. Doug Gross, the governor's friend and former chief of staff, has been advising Cedar Rapids casino backers from the beginning. He works with Rich Schwarm, a GOP strategist and Branstad insider.

Three of the governor's top financial backers since 2012 are Cedar Crossing investors. Two - John Smith, chairman of the board at Cedar Rapids trucking company CRST, and Des Moines businessman Jim Cownie - are among Branstad's longtime allies. The third is perhaps the Governor's most surprising 2014 supporter, Bill Knapp, a Des Moines developer who usually is among the top givers to Democrats.

According to Branstad's campaign finance filings, Cownie has contributed $75,000 to Branstad's campaign committee since October 2012. Smith has given $25,000 in direct contributions and spent $1,900 on a fundraising event. Knapp has given Branstad $30,000.

The governor has raised millions, but the six figure pile donated by this trio is pretty hefty by Iowa standards.

Lead casino investor Steve Gray held a fundraiser for Branstad at his home in October 2012 featuring Wisconsin Gov. Scott Walker. According to Branstad's filings, Gray spent $14,200 on hosting the event, including food, drinks, tents and lighting. Ten people listed as host committee members on the event's invitation also are listed as Cedar Crossing investors, including Smith and Cownie. Cownie contributed $750 to fly Branstad from Des Moines to Cedar Rapids for the event.

Gray also has contributed $10,000 directly to Branstad. Fellow top casino investor Drew Skogman has contributed $2,400, Clark McLeod and Diamond V Mills Chairman of the Board John Bloomhall also have contributed $10,000 to the governor's committee.

But most of these big givers are longtime Branstad supporters who have contributed this much or more to the governor in the past when no casino was on the line. McLeod and Bloomhall, for example, also gave $10,000 to the governor during the 2010 election cycle. So the casino may or may not be much of a factor in any of this political giving. Branstad, as I said, has taken a vow of neutrality.

But these connections are not insignificant. What I do think they show is that successful, politically active, and, yes, influential people are backing Cedar Crossing. And they're folks who don't usually place bets on obvious long shots, and who understand how government makes decisions. Smith, Knapp and Cownie, especially, are good gets for the investor group. Smith spoke to commission members after they took a bus tour of the proposed Cedar Crossing site earlier this month.

'It's something we need now,” said Smith, who opposed a 2003 Linn County gambling referendum. 'It's the right time.”

Why would Des Moines developers invest? Both Knapp and Cownie are heavily involved in downtown Des Moines' development efforts and, last July, the Des Moines Register reported that Knapp was in on a closed-door meeting discussing the possibility of a second capital city casino. Maybe folks in Iowa's largest city are thinking about the possibilities of an new-style urban casino, too.

Big name backing clearly bodes well for Cedar Crossing's prospects. But the fact is, every casino license application has friends in high places. Politicians, donors, developers and business interests stand behind pretty much every bid. Gov. Chet Culver went to bat for all four applicants in 2010, but only one got a license. See 'no upside” above.

And even hefty campaign contributions pale in comparison next to the $34 million in combined state taxes paid by Riverside Golf Course & Casino and the Isle Casino in Waterloo in Fiscal Year 2013. Those are the casinos that would take the biggest revenue hit from a Cedar Rapids competitor, according to market studies, potentially slicing those tax revenues. Cedar Crossing contends it would add its own new taxes to the state pot. These are critical dollars the state depends on to pay for infrastructure projects, environmental programs and much more.

That is what's at stake for the commission. Are the benefits of Cedar Crossing enough to outweigh any competitive damage done to revenues in Riverside, Waterloo and other facilities? Does granting a license make the industry it regulates stronger?

I think the influential people backing it have made a good case that Cedar Crossing would be a net positive, well-positioned to compete in a changing market and deliver an economic boost to Cedar Rapids. And if they get a license Thursday, I still think it will have a lot more to do with what they're building than who they know.

l Comments: (319) 398-8452; todd.dorman@thegazette.com