Posted on: December 18, 2024, 01:45h.
Last updated on: December 18, 2024, 02:14h.
On Tuesday, city officials in Cedar Rapids signed off on a host agreement for a possible casino resort.
The Cedar Rapids City Council voted 8-1 in favor of a resolution that executes the city’s Casino Development Agreement with two entities called the Cedar Rapids Development Group (CRDG) and its charitable arm, the Linn County Gaming Association. The pact grants the city’s exclusive support for the creation of a casino development, with CRDG being the town’s designated partner.
Should the Iowa Racing and Gaming Commission (IRGC) grant a casino license for Cedar Rapids, CRDG will purchase roughly 25 acres of city-owned land just west of the Cedar River between I and F avenues at fair market value. The terms require that 2.25% of the casino’s gross gaming revenue go to Cedar Rapids’ coffers.
The local tax share is in addition to the 8% of net gaming proceeds that CRDG has pledged to the Linn County Gaming Association, which in turn will direct the funds to nearby charitable causes and initiatives. The casino would be further taxed by the state, which takes 22% of riverboat and land-based casinos’ annual GGR.
The host agreement additionally requires CRDP to pay for flood mitigation measures, conduct a traffic study, and pay for any needed site improvements.
Majority Support
Seven of the eight Cedar Rapids City Council members spoke in support of bringing a casino to the state’s second most populated city. The $275 million project called Cedar Crossing Casino also received the support of Mayor Tiffany O’Donnell.
We are pleased to have the continued support of the Cedar Rapids City Council, which has taken the next step to make Cedar Crossing a reality,” said CRDG President Jonathan Swain. “Cedar Crossing will be a transformative addition to the region by providing premier entertainment options, creating economic opportunities and providing the region with unprecedented nonprofit support.”
Cedar Rapids Councilor Ashley Vanorny was the lone dissenting vote against the Casino Development Agreement. A healthcare professional by day, Vanorny said the casino’s plans to allow indoor tobacco smoking forced her nay vote.
CRDG consists of about 80 local investors who for more than a decade have been seeking to secure a gaming concession from the state. The IRGC denied gaming applications for Cedar Rapids in 2014 and 2017 due to market saturation concerns.
Iowa lawmakers later passed a two-year moratorium on allowing the IRGC to issue additional gaming licenses. The moratorium expired on July 1, 2024.
CRDG is working with Peninsula Pacific Entertainment. Swain is a board member of the Los Angeles-based gaming developer and operator.
The IRGC is currently reviewing market feasibility studies on allowing a casino in Cedar Rapids. The state’s 19 other casinos predominantly oppose the Cedar Crossing Casino effort on concerns that it will poach play.
Cedar Crossing is a proposed 110K-square-foot facility with 39K square feet of gaming, 17K square feet of restaurant space, 16K square feet of event space, and a 5,000-square-foot cultural center and children’s STEM lab.
The IRGC is expected to vote on the Cedar Rapids casino bid on Feb. 6, 2025.
Legal Challenge
Elite Casino Resorts, which owns Riverside Casino & Golf Resort and would likely be most impacted by a casino in Cedar Rapids, is challenging whether gambling can even occur in the city.
Cedar Rapids held two successful local ballot referendums in support of a casino in 2013 and 2021. The vote three years ago permanently authorized slot machines, table games, and sports betting in Linn County should the IRGC permit a license there.
Elite’s attorneys allege the 2021 referendum only asked voters if they wished to allow the “operation of gambling games … to continue.” Since there were no casino games to “continue,” the legal complaint contends that the referendum ratified nothing.
“There were no games that the voters could authorize to ‘continue,’” the petition for declaratory relief read. The IRGC is reviewing the petition in consultation with state attorneys.
