Indiana Economic Digest | Indiana
Advanced Search

• Most Recent

home : most recent : community development July 25, 2017

12/19/2010 10:02:00 AM
Casino Aztar, Evansville have close, sometimes tense relationship

Fireworks light the sky behind the riverboat City of Evansville at Dress Plaza after the boat arrived in Evansville in November 1995. RICHARD HICKS / Courier & Press archives
+ click to enlarge

Fireworks light the sky behind the riverboat City of Evansville at Dress Plaza after the boat arrived in Evansville in November 1995. RICHARD HICKS / Courier & Press archives

Aztar timeline

July 1, 1993: The Indiana Riverboat Gaming Act goes into effect. The new legislation allows for up to 11 riverboat gambling licenses — but only with local approval from voters, except in Gary.

Nov. 2, 1993 Voters in Vanderburgh County approve a referendum, with about 52 percent of the vote, allowing the county to pursue one of the licenses for riverboat gambling in the state. Warrick County voters vote casino referendum down.

Dec. 7, 1995: Casino Aztar, Indiana's first Riverboat casino opens to the public. The ship's maiden 6 p.m. voyage has about 500 patrons on board. The ship cruises twice more that night — at 9 p.m. and midnight.

Nov. 30, 1996: Gus and Dorothy Hunter of Evansville are jointly recognized as the Aztar's 2.3 millionth patrons, the first-year goal set by casino officials.

Aug. 1, 2002: State Legislature legalizes dockside gaming, which means an end to cruising on the river for the City of Evansville vessel.

Sept. 13, 2006: Aztar opens new $40 million, 7-acre Entertainment District opens. Complex includes Blush lounge and Ri Ra Irish pub as well as the casino's second hotel Le Merigot.

Jan. 3, 2007 Kentucky-based Columbia Sussex Corp. buys Aztar's parent company, Aztar Corp. for about $2.75 billion in cash and debt.

March 30, 2008 Robert "Tom" Dingman, appointed as trustee to run Casino Aztar temporarily while it is supposed to be sold to Eldorado Resorts, sale is never completed.

May 6, 2008: Tropicana Entertainment LLC, an affiliate of Columbia Sussex, and the parent company of Aztar, files for bankruptcy.

June 8, 2008: William J. Yung, whom city officials blamed for many of Aztar's problems, steps down as CEO of Tropicana Entertainment LLC.

Jan. 13, 2010: The Indiana Gaming Commission approves Tropicana Entertainment's bid for a new license meaning the reorganized company can regain control of Aztar once it emerges from bankruptcy.

April 14, 2010: Tropicana Entertainment CEO Scott Butera officially welcomes Aztar into the Tropicana family, ending Aztar's time in bankruptcy.

July 2, 2010: Indiana law allows Aztar to stay open 24 hours a day on weekdays.

Richard Gootee, Evansville Courier & Press

Casino Aztar and the city of Evansville shared a bond even before the casino opened in December 1995 as the state's first riverboat casino.

The replica steamboat, which was required to cruise on the Ohio River until 2002, isn't named Aztar — instead it's officially known as the City of Evansville.

Though the relationship with the city hasn't always been rosy, particularly in the last few years, Aztar has pumped almost $200 million into its host city's budget in taxes and lease payments and brought millions more in tourism dollars during its 15-year run. It has also given more than $60 million to the county and more than $320 million to the state in tax revenue, according to a 15-year impact study Aztar released earlier this week.

According to an annual study commissioned by the Evansville Convention & Visitors Bureau, visitors spent more than $356 million in 2009 while in the city. Without Aztar's presence, the study concluded that figure would drop more than $120 million.

"Aztar is our No. 1 attraction," said bureau spokeswoman Laura Libs.

Figures released by the Indiana Gaming Commission show gamblers lost more than $113 million at Aztar during the 2010 fiscal year alone. The casino in turn paid more than $30 million in taxes during that time. Of those tax dollars, about 55 percent goes to the state, 33 percent to the city and 11 percent to the county.

The fruits of that casino money over the last 15 years include additions to Mesker Park Zoo & Botanic Garden, some funds for the new Downtown arena, more police cars and other public safety initiatives.

There also were no layoffs within city government during tough economic times in recent years, although City Controller Jenny Collins wouldn't attribute that directly to the infusion of casino funds.

Other projects supported by casino revenue include $1.8 million for the LST 325 dock, $2 million for the Koch Family Children's Museum of Evansville and $1 million for the Evansville African American Museum.

Aztar General Manger Ward Shaw, who has been in his post since June, said he hopes the casino can be one of the forces behind the ongoing revitalization of Downtown.

"Having options like a healthy zoo, a viable philharmonic orchestra, a developed Main Street Downtown with good thriving restaurants and retail options for residents and visitors (because) that helps our business too," Shaw said.

Debbie Dewey, president of the Growth Alliance for Greater Evansville, said the impact Aztar has had on Downtown is clear as a sponsor of Downtown events and economic development for the area.

"I see them as a supporter and a partner in the long-term development plans for Downtown," Dewey said.

Both Collins and Vanderburgh County Council President Russ Lloyd Jr., a former Evansville mayor, said without the casino, local government officials would have had to weigh the need for some major local projects against the possibility of raising taxes.

"We've been able to move the city forward with the dollars we receive from gaming revenue as far as our capital improvements projects go," Collins said. "Those are projects that we either wouldn't have been able to do or would have potentially had to raise taxes to do. It's been a huge benefit to us."

Collins said the city receives a maximum of about $7.1 million in taxes alone, $2.1 million in admission taxes and $4.6 million in wagering taxes. The city also has a lucrative lease agreement for the riverfront property Aztar uses. In 2011, Collins said, the lease alone would be worth about $1.2 million. Lloyd said most of the county money in recent years has gone to economic development initiatives.

Riverboat gaming was a hot topic when it was first passed by the state Legislature. But a decade later, other cities and towns officials had started wishing they had a riverboat because of the cash it was pumping into municipal budgets, said Lloyd, who was mayor from 2000 to 2004.

"I know when I was mayor talking to some of the mayors in other cities, that there was some envy there that they didn't have that revenue source," he said.

Casino Aztar was the state's first riverboat casino. For the last fiscal year, its revenue totals ranked ninth among Indiana's 13 licensed gaming facilities. The size of Indiana's casinos, as well as the size of the communities where they are located, vary greatly. Aztar's revenue was above those of facilities in French Lick, Ohio County in eastern Indiana and two on Lake Michigan.

For most of its 15 years, Aztar has been, by most accounts, a solid community partner.

It has been a major supporter of Downtown in general, and it is one of Evansville's largest employers and charitable contributors, giving away more than $400,000 annually on average, according to the casino's marketing director, Stacey McNeill.

Recipients have included the University of Evansville and the University of Southern Indiana as well as the Susan G. Komen for the Cure. It has given $30,000 since 1996 for the Fourth of July Fireworks Spectacular on the riverfront and has sponsored entertainment for the West Side Nut Club Fall Festival for 14 years.

But for at least a short time, there was contention between the casino's former executives and the city.

In early 2007, the Columbia Sussex Group, owned by William J. Yung, bought Aztar's parent company for $2.75 billion. Yung then began firing Aztar employees, which Mayor Jonathon Weinzapfel and others say led to a decline in services and resulted in a public dispute between Weinzapfel and Yung.

Yung has since been ousted as the leader of the ownership group while it was in Chapter 11 bankruptcy. The group renamed itself Tropicana Entertainment, a reference to two of its most well-known properties — Tropicana Hotel and Casino locations in Las Vegas and Atlantic City, N.J. — and emerged from bankruptcy earlier this year.

The gaming commission had begun an inquiry and Columbia Sussex may have lost its license for Aztar. However, the commission recognized Tropicana Entertainment as a different corporation.

Now it appears the casino-city relationship is on the mend. Shaw noted that Columbia Sussex didn't have much experience running casinos and didn't understand the impact it could have on the community.

"There was clearly a former ownership regime that didn't care about their part in being a community citizen, didn't want to work with the community to make this gaming destination an asset," Shaw said.

Even before Shaw arrived, Weinzapfel had noticed a renewed effort from Tropicana. After re-emerging from bankruptcy, the company signed a new lease agreement for $10 million by the end of this year and gave the city an additional $3.5 million designated for Downtown improvements within a mile of Aztar.

"We have very been pleased with the relationship we have developed with Tropicana," Weinzapfel told the Courier & Press in January. "It's a significant difference to see professionals in the gaming industry being in charge of running Casino Aztar."

Aztar also has had talks with the city about becoming the naming sponsor for the new arena, which Shaw believes will bring a bevy of new activity to Downtown.

The casino is currently celebrating its 15th birthday by giving away $500 nightly until Tuesday, 15 days after its birthday on Dec. 7. Though the milestone is important, Shaw said he is focused on the future.

He admitted that the property has had very little capital infusion the last few years, resulting in the property appearing tired. Aztar has plans for some capital improvements, though officials say nothing has been finalized. It's part of the fight to become a destination for gamblers that now have several regional options including casinos in French Lick, and Elizabeth and Metropolis, Ill. But Shaw said the key is for Aztar employees to offer the best services to patrons.

"We all have blackjack tables that play to about the same rules. We all have the same slot machines; we all have a place to sleep and have a place to eat," Shaw said.

"The thing that really makes a difference (is) that in our case all our 950 employees deliver on a regular basis."

Aztar is currently home to eight restaurants and two hotels, counting the two restaurants and Le Merigot located in the $40 million "Entertainment District" adjacent to the casino.

While no plans have been finalized, Shaw said Aztar visitors should begin to see improvements to the casino in 2011, despite the tough economic times that may have prevented many from being able to enjoy what the casino has to offer.

He also noted the casino just completed a $3 million overhaul of its casino gaming system, the first major improvement at the casino in three years, although most customers won't even notice it.

"We're not a must-have or a have-to have. We depend on folks having an entertainment budget to go to movies and restaurants or the casino," Shaw said. "Right now it's a focus on how do we stay competitive, but ensure that we maintain the jobs for our employees and keep our business viable to be able to move forward."

Tropicana Entertainment spokesman Trent Dang acknowledged the problems the casino has had since it was bought three years ago, but said that the company is ready to invest in what it considers one of the shining stars in the Tropicana portfolio.

"We're not looking backward anymore, we have a whole new company with very little debt" Dang said. "We love Evansville and the casino does a good job for us and we're just looking forward to moving on from all that stuff and looking forward to a good 2011."

Copyright 2017 Journal Media Group. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Editor, John C. DePrez Jr.; Executive Editor, Carol Rogers; Publishers: IBRC and IAR

Software © 1998-2017 1up! Software, All Rights Reserved