INDIANAPOLIS - A bill inspired in part by the impending sale of Casino Aztar died in the final hours of the Legislature's session last week for reasons largely unrelated to the Evansville riverboat.
The bill, which dealt with the powers of the Indiana Gaming Commission over departing casino owners, won't become law this year; but its author might bring it back next session.
Meanwhile, the state gaming commission has scheduled a license renewal hearing March 31 for Columbia Sussex Corp. of Fort Mitchell, Ky., the owner of Casino Aztar.
Columbia announced last year it intends to sell Aztar and two other casinos to avoid bankruptcy, after New Jersey gaming regulators revoked Columbia's gaming license in that state, because of understaffing and cleanliness problems at its Tropicana casino-resort in Atlantic City, N.J.
A purchaser for Casino Aztar has not yet been announced. Although Columbia Sussex plans to sell Aztar, it must hold a valid gaming license in order to operate the Evansville riverboat, even if that's only temporarily.
Gaming Commission staff have held discussions with Columbia Sussex concerning the upcoming license-renewal hearing.
"They want to sell, they made it clear they are moving toward that goal; and the conversations we have had with them have been what I consider to be productive," commission Deputy Director Jennifer Arnold said.
Separate from the New Jersey action, the Indiana Gaming Commission launched a post-licensing suitability investigation of Columbia Sussex more than a year ago. After layoffs of more than 70 Casino Aztar workers, Evansville Mayor Jonathan Weinzapfel lodged a complaint that Columbia had not lived up to its earlier staffing promises. Arnold said the commission staff's investigation has been suspended for now, in light of Columbia's plans to sell Aztar.
The legislation, House Bill 1224, dealt with gambling matters. Among other things, it would have set up a procedure for operating an Indiana casino temporarily if the owner lost its license, filed for bankruptcy or abandoned a riverboat.
Rep. Trent Van Haaften, D-Mount Vernon, sought the legislation in light of Aztar's ownership transition.
When Columbia's gaming license was revoked in New Jersey, that state named a conservator - a former state Supreme Court justice - to operate the Tropicana casino resort on an interim basis.
Van Haaften's proposal would have let the Indiana Gaming Commission do something similar and name a trustee to run a casino temporarily until a new owner could obtain a license.
Differing versions
House Bill 1224 passed the Indiana House 82-13 on Jan. 29; a different version cleared the state Senate 45-2 on Feb. 27. But the riverboat bill ran aground last week during House-Senate conference committee negotiations to hammer out differences between the two versions. The Legislature adjourned Friday without passing the final bill.
Even without a new law, the gaming commission contends it still would be in charge of a riverboat during an ownership change.
"We do have broad discretion in dealing with licensees, and that includes the discretion to enter into a mutually acceptable agreement," Arnold said.
"There are measures the Gaming Commission can currently use to make sure the state and city are protected in the Casino Aztar situation," Van Haaften added.
What derailed House Bill 1224, Van Haaften said, was separate wording dealing with transfer fees that gaming license holders could be forced to pay the state if they reaped a windfall from selling their riverboats or horse tracks.
Several state lawmakers contended the Gaming Commission and Indiana Horse Racing Commission do not have the legal authority to force divesting owners of casinos or tracks to pay the state such fees, which could total in the millions of dollars.
Fees in dispute
When LHT Capital LLC sold its minority share in the Indiana Downs horse track in Shelbyville, Ind., the racing commission required it to pay the state $9 million. The divesting owner sued the state to recover the money, and the fee dispute is in litigation.
House Bill 1224 would have wiped out the commissions' transfer fee rules retroactively. Van Haaften said that would have required the state to refund the $9 million fee to the former Indiana Downs owner - and that was the sticking point that kept the bill from advancing out of conference committee. Van Haaften said the Senate was reluctant to pass a new law affecting a still-ongoing lawsuit; so the Legislature adjourned without prohibiting transfer fees.
Now the Gaming Commission intends to renew its own rule that allows such fees, Arnold said. How the fees might impact Columbia Sussex when it sells Aztar is unknown.
"Without having a request for a (gaming license) transfer, it is difficult to speculate on what fee would be assessed," Arnold said.
Van Haaften said his legislation would have applied to all Indiana gaming facilities - riverboats, horse tracks and the French Lick resort - not just to Aztar. He said he might reintroduce the bill in 2009.
"As with many things with the General Assembly, you sort of start feeling like a Cubs fan: 'There is always next year,'" he said.