Riverboat gambling interests raised the corporate stakes in Elgin and Joliet on Wednesday, while a newly formed lobbying group representing those interests vowed to do whatever it takes to kill Mayor Richard Daley`s plans for a mega-casino in downtown Chicago.
The new coalition of Illinois riverboat gambling complex developers are planning to lobby in Springfield against Daley`s proposal to build a $2 billion entertainment and gambling complex.
William P. Weidner, president of Hollywood Casino of Aurora Inc., said he will go to Springfield to support Gov. Jim Edgar`s opposition to the proposal, as will other members of the Riverboat Alliance.
If Daley`s proposal were approved, riverboat gambling operations under way or under construction in eight smaller, aging industrial cities would suffer, Weidner said.
Weidner predicted that the riverboat gambling operations would still make a diminished profit, but revitalization of the cities in which they are located would be slowed or halted. When legislators approved riverboat gambling in January 1990, they said the proposal was aimed at revitalizing those cities.
”If Chicago had said in 1990, `I`m not interested in riverboats; I want land-based gambling,` you would never have seen any riverboat projects in Illinois,” Weidner said.
The Daley administration has argued that the city never promised that it would not permit land-based gambling, and that such a complex would not damage riverboat gambling operations.
But Weidner disagreed.
”A black hole is a black hole,” he said. ”The definition of a black hole is that its gravitational pull is so strong that no light can escape from it. For Chicago to say that its complex won`t draw someone from the suburbs is incorrect thinking.”
Weidner`s Hollywood Casinos of Aurora is owned by Pratt Hotel Corp. of Texas and a group of investors. Weidner is president of Pratt.
His company has issued $90 million in bonds to launch the $60 million riverboat gambling complex in Aurora next July.
Weidner`s pledge to lobby against Daley`s proposal comes a week after Aurora Mayor David Pierce made a similar vow, saying, ”We will work to fight to save these jobs in our community and not to see this investment squandered.”
The potential for this investment was illustrated with the disclosure Wednesday that a second Nevada casino operator has filed an application with the state to operate a riverboat on the Fox River in Elgin.
Mirage Resorts Inc. of Las Vegas, which currently operates three big casinos in Nevada, said it wants to build a $90 million complex in Elgin that includes a riverboat, hotel and ice rink.
The move by Mirage has upset Elgin officials, who already are working with another company on a riverboat proposal. Nevada Landing Hotel and Casino Inc. of Jean, Nev., applied in June to the Illinois Gaming Board for permission to put a riverboat in Elgin. Nevada Landing also signed a contract with Elgin for the planned $30 million project, pending state approval.
Only one riverboat license is currently available, meaning the state Gaming Board would have to choose among Nevada Landing and Mirage, and a third applicant who wants a riverboat for Moline.
”Mirage sees the Elgin location as being a good location for a high-quality riverboat facility,” said Robert Sperling, an attorney for Mirage, adding that the company is ”pretty positive” about Elgin`s potential.
After learning that Mirage had applied on Wednesday, Elgin`s City Council quickly passed a resolution of support for Nevada Landing, at the company`s request. The resolution also said Elgin would not work with Mirage even if it receives the license.
”It`s Elgin`s decision who they want here,” said Larry Rice, Elgin`s city manager. ”We have a two-year contract with Nevada Landing. The City of Elgin made a conscious decision to have riverboat gambling with Nevada Landing.”
However, the question of which gaming company has Elgin`s support isn`t directly related to the permitting process. The state, not individual cities, grants the license to a gaming company. Once a city has approved the idea of bringing a riverboat to town, any company can vie for an available license.
Gaming Board members said Thursday that Elgin`s endorsement of the Nevada Landing means little in the decision-making process.
More Top Picks Wine Glasse
”We decide who is in a better position to create jobs and development for the area, who has the soundest financing,” said J. Thomas Johnson, a board member.
Should Mirage be granted the license, Sperling said he was sure Elgin would then negotiate a deal with Mirage.
”I would think that any community would want to work with a company with the reputation of Mirage Resorts,” he said.
But Mayor George Van DeVoorde of Elgin said that although the state grants licenses, he believed the state Gaming Board would respect the city`s choice of a partner.
He also said he believed it would be unethical for the city to deal with the Mirage because it already has a contract with Nevada Landing. Even if Mirage won, he said, Elgin wouldn`t be comfortable dealing with anyone else.
He said the city already has received $50,000 in rent money on land being leased to Nevada Landing.
In Joliet, meanwhile, the state Gaming Board decided the city won`t lose the downtown riverboat gambling casino it is counting on as the centerpiece of its redevelopment effort.
In return, the private developers promised to put two boats in the water instead of one, with the first ready to open no later than mid-June and possibly as early as mid-April.
The state Gaming Board had issued the license for a Des Plaines River berth in downtown Joliet-one of two it awarded in the area-more than a year ago. But the passage of time with little activity and a change of ownership prompted the board to ask for a review of that license with an eye toward revoking it and awarding it elsewhere.
But after a 3 1/2-hour public hearing and a 3-hour closed-door session, the five-member board decided to keep things pretty much they way they were, to the relief of Joliet officials.
The decision means that there will be at least five riverboat casinos operating in the Chicago area by late 1993: the two in downtown Joliet, two more in Aurora and another-already in operation-near Channahon. Still to be decided is the license being sought in Elgin.
So far, the only gambling vessel in the area is the Empress River Casino, which was launched near Channahon in June and has enjoyed spectacular results. According to latest state figures, it has taken on board nearly a third of the 1.5 million passengers on the state`s five riverboat casinos this year, despite the fact that it has been in operation only four months.
The downtown Joliet venture, on the other hand, has been plagued with startup problems.
The Gaming Board awarded the license for that operation to Springfield, Mo., developer John Q. Hammons. But Hammons had difficulty raising financing and was forced to bring in Harrah`s Cos., a gambling giant, as the 80 percent majority partner in the venture to keep the project afloat.
The inclusion of Harrah`s, in essence, also meant that the license had been turned over to a party that had not been investigated or voted on by the Gaming Board. Because Harrah`s was not the original applicant, the board said it would have to reapprove the license, which it did Thursday.
To win that approval, Harrah`s committed itself to two boats, increasing the total investment in the project to $50 million from slightly more than $32 million. A total of $2.5 million will go for Joliet redevelopment projects, including $1 million for a downtown river walk.