Casino Queen prepares to build larger casino - Saturday 12th of March 2005
The Casino Queen plans to start construction this summer on a larger casino with more amenities to replace its riverboat before a competitor enters the market across the river on Laclede's Landing.
The East St. Louis casino plans a $150 million facility that would be built on the 80 acres it currently owns, creating the largest development project in at least 50 years for the beleaguered city. The first phase - which will cost about $60 million - includes a boat in a moat to be built in the casino's parking lot, southeast of the riverboat and its 157-room hotel.
"With the new facility, we can go head-to-head" with the Missouri casinos, said Jeff Watson, an attorney for the Casino Queen, who outlined the proposal Monday night at the first of a series of public hearings. "The current facility just does not allow us to be competitive."
p>Among its competitors is Pinnacle Entertainment Inc., which plans to start construction this year on a $250 million casino in St. Louis that will open in early 2007. The Missouri Gaming Commission approved the project in September. The Casino Queen expansion is also aimed at gaining ground on the two gambling facilities that consistently beat it in revenue each year, Ameristar in St. Charles and Harrah's in Maryland Heights.
Ameristar Casinos Inc. completed a $360 million expansion in August 2002 with a barge-based facility that was nearly three times the size of its old riverboat. Harrah's Entertainment Inc. spent more than $80 million to improve its casino in the past few years. It opened a new hotel tower in August, giving it roughly 600 rooms.
Columbia Sussex Corp. hopes to buy the President Casino on the Admiral and invest $150 million to turn it into a more competitive gambling facility along the Mississippi in St. Louis. But a battle with Pinnacle over land has put the Columbia Sussex project in flux.
Last month, the Casino Queen won $14.5 million from gamblers compared to $24.5 million at Ameristar, $23.4 million at Harrah's and $5.87 million at President Casino.
The public hearings that began Monday are required by East St. Louis because the Casino Queen's projects are in a tax-increment financing district. The project would receive up to $11 million in breaks.
The Casino Queen would not get any money from the city until the new casino is built. Then bonds would be sold and paid for from the increased property taxes created by the new casino.
The Casino Queen's growth is crucial to the financial health of East St. Louis. The roughly $10 million a year the city gets in taxes from the boat is half the city's general fund, which is used to pay employees, pave streets, pick up trash and repair sewers.
Watson said that with the expansion, $1 million to $1.5 million a year more in gambling taxes would go to the city. City Attorney Mike Wagner said the city's gain in taxes more than offsets what it might lose in increased property taxes from the new casino. He argued that without the incentive, the Casino Queen has indicated the expansion project might not happen.
The Casino Queen employs 1,127. Casino officials could not say Monday how many more employees would be hired with the expansion. Acting City Manager Alvin Parks said that 50 to 100 new jobs would be likely for East St. Louis residents, based on his conversations with casino officials.
"This is extremely positive for the city," Parks said. The project still needs approval from the City Council and the Illinois Gaming Board.
The Casino Queen has committed to at least 50 percent of the construction crews being local or minority contractors. East St. Louis is 99 percent African-American.
The free-floating barge would provide about 10,000 more square feet in gambling space than the 27,000 square feet on the boat, which opened in 1993. The one-level layout on the barge will make it easier to use the space than the three-story riverboat, Watson said.
"I think this will rival anything the Missouri facilities have or will have in the future," Watson said.
Casino Queen plans
Replace the riverboat that opened in 1993 with a larger casino.
br>Create an additional $1 million to $1.5 million in revenue for the city, which currently gets $10 million a year from gambling.
Receive up to $11 million in tax increment financing from the city for the project.
Open the boat-in-a-moat by early 2007.
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