The Iowa Racing and Gaming Commission recently told Missouri River Historical Development, the non-profit partner of the Hard Rock Hotel and Casino Sioux City, that the IRGC will not help it collect .8 million MRHD has demanded in back revenue-sharing payments from Penn National Gaming. “We really think it’s a matter that falls outside of the Iowa Racing and Gaming Commission’s jurisdiction,” said commission Administrator Brian Ohorilko .
MRHD, which holds the gaming license for Woodbury County, had been the non-profit partner of Belle of Sioux City on the former Argosy Sioux City riverboat casino, a subsidiary of Penn National Gaming. Under Iowa law, casino operators must partner with a licensed non-profit organization to collect and distribute 3 percent of adjusted gross gambling revenue to charitable organizations.
However, according to the Sioux City Journal, Penn National Gaming stopped making those payments in June 2013, two months after the IRGC awarded the county’s first land-based gaming license to MRHD. By then the non-profit had joined forces with SCE Partners, developers of the Hard Rock Hotel and Casino Sioux City. The Argosy Sioux City closed soon after, on July 30, 2014.
Later, a Polk County District Court judge denied a motion from Penn National Gaming to appoint a third-party receiver to collect and distribute the revenue-sharing funds. At the same time, the IRGC rejected another request from Penn National Gaming to redirect the money to a different local non-profit organization.
Penn National Gaming then sued MRHD, alleging the non-profit conspired to team up with another operator before its arrangement with Argosy expired in July of 2012. Previously, MRHD and Argosy could not agree on a long-term contract extension. As a result, the IRGC took the unusual step of putting the Woodbury County gaming license up for grabs, and started accepting proposals for a land-based casino.
MRHD then counter-sued, claiming that Penn National Gaming had sent threatening letters to other potential operators MRHD may have wanted to partner with. MRHD also alleged Penn National Gaming’s prevented or delayed the non-profit from negotiating a more lucrative land-based casino agreement.
Both cases remain open but no hearings have been scheduled. MRHD still could ask the IRGC to address the issue at a future meeting.
