Construction of Kansas Crossing Casino south of Pittsburg, Kansas will not resume for a while, said Kansas Crossing spokeswoman Carrie Tedore, even though Judge Larry Hendricks recently denied a motion for discovery filed by Castle Rock Casino, which had unsuccessfully bid for the fourth and final state-owned casino in Kansas, and the Cherokee County Commission.
Last August, Kansas Crossing Casino officials received a 90-day extension for the completion date for the project while the lawsuit moved forward. Tedore commented, “Kansas Crossing will deliver a report to Kansas Lottery regarding the status of the lawsuit at the end of November. At that time, the decision will be made whether or not requesting another 90-day extension will be necessary.”
Following the selection of Kansas Crossing in June, Castle Rock Casino and the Cherokee County Commission sued the Kansas Racing and Gaming Commission and the Kansas Gaming Facility Review Board, claiming the board chose the wrong developer and did not follow state law. The suit also alleges improprieties in the selection process, “including the last-minute inclusion of ‘sweeteners’ in contradiction of prior Lottery direction.” Gaming commission officials denied the claims.
Castle Rock attorney Russell Jones noted the $70.2 million Kansas Crossing proposal was the smallest of three competing proposals, compared to Castle Rock’s $145 million bid, the largest of the three. Castle Rock also was forecast to attract nearly 1 million visitors annually, mostly from beyond Kansas, about double Kansas Crossing’s predictions. However, Castle Rock’s ability to meet its debt service and offer long-term viability was questioned in an independent review.
Tedore noted, “Judge Hendricks issued the second straight defeat to Cherokee County and Castle Rock in their attempt to discredit and derail the winning project. This time Castle Rock attempted to pursue expanded discovery through the use of false and unsupported allegations without any basis.” Kansas Crossing lead investor Bruce Christenson agreed, noting, “The judicial review action filed by Cherokee County and Castle Rock’s investors following the state’s selection of Kansas Crossing represent nothing more than last-ditch efforts by sore losers to derail the project that won the competitive bid. The competitive application process for the Southeast Kansas Casino Manager was transparent, legal and complete.”
Hendricks’ ruling will allow the issue to move forward, although he said he will not be able to address the case until January. Initial briefs in the case will be due December 11 and “answer” briefs will be due December 21. Unless the parties request it, there will be no oral arguments.
Meanwhile, the state and local governments will lose nearly $2.3 million during the 90-day delay. Crawford and Cherokee counties and the city of Pittsburg each anticipate a loss of $88,270 in 2016 gaming tax revenue. The region’s skilled trade workforce development and education center, C-Tec, the recipient of 1 percent of gross gaming revenue annually, or at least $400,000 per year, will lose almost $100,000 due to the delay.
