State panel OKs gambling market study that could mean more casinos

Osceola, Ia. – The Iowa Racing and Gaming Commission unanimously agreed Thursday to authorize a statewide study of Iowa’s casino markets, a step that could open the door to the issuance of new gambling licenses.

The 4-0 vote to proceed with a study was made in response to a recent referendum vote in Linn County that is expected to result in the filing of a state license application for a Cedar Rapids casino. The regulators set a deadline of Sept. 3 for developers to file a license application for the Cedar Rapids project.

Iowa currently has 21 casinos, including 18 state-regulated gambling facilities and three American Indian casinos. When the commission last considered awarded casino licenses in 2010, state regulators concluded that most of Iowa was already saturated with gambling. Only one new license casino was awarded – for the Grand Falls Casino Resort near Larchwood in northwest Iowa’s Lyon County – because of concerns any additional gambling licenses would cannibalize Iowa’s existing casino businesses.

Jeff Lamberti of Ankeny, the commission chairman, said the market study will focus on Cedar Rapids. He said it may also hone in on the Jefferson area, where the Greene County Board of Supervisors this week approved a resolution supporting a casino project.

But the research will also look at statewide gambling market, including the Des Moines area, Lamberti said. Iowa’s state-regulated casinos last year had about 23 million admissions while generating gross gambling revenue in excess of $1.4 billion.

“When you start looking at central Iowa, it becomes the issue of, ‘Is there additional market share?’ ” Lambert said. “… So we want to look at the state as a whole, as has been done before, to see if there is market share available, and also to look at the impact on existing facilities” if new casinos are authorized in Iowa.

Gary Palmer, general manager and chief executive of Prairie Meadows Racetrack and Casino in Altoona, said he agreed it’s a good idea for state casino regulators to periodically conduct such studies.

For the 12 months ending June 30, 2012, Prairie Meadows had 2.7 million admissions and gross gambling revenue of about $194 million.

“We know that for the last few years the gaming dollar has been going down, which kind of indicates the conclusion. But it is only fair to do a study, and I think the commission is doing the right thing by doing it,” Palmer said.

Asked about the possibility of Prairie Meadows developing any additional gambling facilities as a result of the study, including a possible casino on Des Moines’ south side, Palmer shook his head no.

“We think the market right now is saturated, so we probably wouldn’t be doing any of that right now. I  think they will find that with the statewide study as well,.” Palmer said.

Lamberti said he expects the  gambling market study to be completed sometimes between January and March 2014. The commission still needs to hire one or two firms to conduct the research.  The commission won’t make any decisions on requests for a gambling license in Cedar Rapids until the research is finished, he said.

The commission held its regular meeting Thursday at Lakeside Casino in Osceola.

Reported:  Des Moines Register