The Iowa legislature recently voted to prohibit the Iowa Racing and Gaming Commission from issuing any new casino licenses before June 30, 2024.
The amendment, attached to a broader measure addressing regulations and online betting, particularly targets Cedar Rapids and Linn County, where officials had been working toward a casino for the last decade. It was not discussed before it was introduced, approved by the House and Senate and sent to Governor Kim Reynolds for her signature; if she signs it, the moratorium would take effect June 1.
Cedar Rapids Mayor Tiffany O’Donnell said, “It’s hard to not feel played as a city, it really is. We’ve been playing by the rules just like we’ve done in the past. But in the eleventh hour, there seemingly may have been a front room, backroom or I don’t know where deal. This happened so lightning fast and we have yet to hear much about how it first of all made the agenda and the reasons why it passed so quickly.” O’Donnell said she asked Reynolds directly not to sign the bill.
Cedar Rapids state Rep. Kirsten Running-Marquardt added, “This is incredibly unfair. People have been navigating and working with the Gaming Commission and then all of a sudden, we see a moratorium pop up.”
In a statement, Linn County Gaming Association President Anne Parmley said it seems as though lawmakers targeted the county. She said, “This holds the Corridor back from entertainment, nightlife, dining and gaming options that were set to breathe new life into Iowa’s second largest city and give much-needed support and infrastructure improvements to the area.”
The legislation came up as the city was preparing to submit a casino license application to the Iowa Racing and Gaming Commission for the third time. Its plans were rejected in 2014 and 2017. Commissioner Delores Metz was the only member to approve the city’s application both times. She said, “I felt like the second-largest city in the state deserves something. I still feel that way.”
Commissioners said a Cedar Rapids casino would cannibalize business at nearby existing casinos; House lawmakers also gave that reason for supporting 2-year moratorium. Cedar County Republican state Rep. Bobby Kaufmann, chair of the House State Government Committee, said, “The thing that most interests me is protecting the nonprofits that the casinos currently spend money on.” Under Iowa law, casinos must give 3 percent of annual adjusted gross revenue to local nonprofits.
State Rep. Shannon Lundgren, who sponsored the amendment in the House, said the moratorium “gives us an opportunity to look at what’s happening in our competitive states and then make a decision from there if we want to expand the land-based casinos in the state.” Currently 19 casinos operate in Iowa.
By contrast, state Rep. Steve Hansen said the amendment is “reactive instead of proactive.” He represents Sioux City where the Hard Rock casino are bracing over competition expected from new venues in Nebraska. Hansen said, “The western Iowa casinos from Sioux City down to Council Bluffs, we will be impacted by Nebraska gambling, as will the whole state of Iowa, and I think we’re going to end up wanting to increase licenses elsewhere in the state of Iowa to pick up that revenue that we’re going to lose. So, I think this amendment as far as the moratorium, part of it is very shortsighted.”
Observers noted state Senator Roby Smith received $23,000 from Elite Casino Resorts political action committee just before he introduced the moratorium amendment, according to Iowa Ethics and Campaign Disclosure Board data. Dan Kehl, chief executive officer at Elite, has frequently criticized a possible Cedar Rapids casino, stating it would grab profits from venues in Waterloo and Meskwaki, as well as Elite’s Riverside property. Elite also owns a casino in Davenport, represented by Smith.
O’Donnell stated she’s aware the gaming industry contributes to many political candidates, but added she’d like to know how the Elite PAC donations may have affected lawmakers’ decisions regarding the moratorium.
