Cedar Rapids casino backers try again

Cedar Rapids investors are preparing a third attempt to win a casino license from the Iowa Racing and Gaming Commission, which would allow for the construction of a $250 million casino complex on the west bank of the Cedar River downtown.

The commission plans to hire a firm to conduct a gambling market study. It will be interesting to see if the commission rounds up the usual suspects and picks a firm that has done past market studies, or whether it will look for a new perspective.

It was market studies that doomed the first two Linn County license bids in 2014 and 2017. The studies showed a Cedar Rapids casino would “cannibalize” a considerable amount of its revenues from nearby casinos in Riverside, Waterloo and Dubuque. The commission fixated on shielding those casinos from new competition.

We’d like to see the commission take a broader view. Iowa’s overall gaming revenue is being sapped by new casinos in Nebraska. A Cedar Rapids casino could shore up that loss of revenue. Casino tax dollars in Iowa go for infrastructure projects, state building maintenance, water quality and tourism.

Iowa’s 19 state-licensed casinos generated $4 billion in revenue during Fiscal Year 2023.

We’d also like to see analysis on how a new casino in Iowa’s second-largest city might bring competition that improves Iowa’s gambling market. Casinos faced with a new Linn County facility might have to improve their own casinos. Until now, competition has been a dirty word among existing Iowa casinos, which operate more as a cartel than businesses in a free market.

Regardless, local investors, the Linn County Gaming Association and gambling operator Peninsula Pacific Entertainment, face an uphill process. The five current members of the Racing and Gaming Commission were not involved in past Cedar Rapids license bids.

In 2014, investors pitched an ambitious casino project on the riverfront, touting its potential to boost the city’s recovery from the 2008 flood. IT received just one yes vote from a commission concerned about its potential for cannibalization.

In 2017, local investors backed two applications, one for the Cedar Crossing casino that failed in 2014 and one for a smaller casino adjacent to the Alliant Powerhouse, the Hilton Double Tree hotel and convection complex. That proposal received two yes votes.

Now, local casino backers are once again pushing to license a large riverfront casino.

The good news is Cedar Rapids doesn’t need a casino. No ambitious downtown redevelopment plans are dependent on gambling. The site of the first proposed casino, at First and First West, is now home Big Grove Brewing, the Pickle Palace and other attractions to come.

That said, we hope the commission looks beyond the narrow interests of existing casinos and focuses on the big picture. Otherwise, the third time won’t be a charm.