Caesars Race to the Bottom in Ohio

After having the common sense to oppose Predatory Gambling for many years, the Gambling Industry wrote referendum legislation in Ohio and tossed gazillions into the mix to convince voters of the advantages of having discretionary dollars sucked from their communities.

Although the article below represents one more instance of taxpayer subsidies supporting the Dead Horseracing Industry, it also involves Caesars (formerly known as Harrah's), a heavily indebted suitor of Massachusetts that is currently unloading unprofitable properties.

Professor Goodman wrote about how quickly the local supply of Gambling Addicts is exhausted at a time when the patrons were less local than they have become. (His book is titled "The Luck Business" - well worth reading.)


Airport would defer racino decision to Green
By Betty Lin-Fisher and Rick Armon
Beacon Journal staff writers

Akron-Canton Airport officials said Friday they would most likely approve a combined horse racetrack and video slots parlor on airport property, but only if Green gives its blessing.

The big question now, however, is whether the airport is still a potential site for a relocated Thistledown, a thoroughbred track in suburban Cleveland looking to move to the Akron area.

“We don’t know if it’s still on or not,” airport President and Chief Executive Officer Rick McQueen said.

The airport was approached last summer by a real-estate company looking for a large tract of land for an undisclosed use. Airport officials later learned it was Rock Ohio Caesars and Caesars Entertainment searching for a possible site for a racino, the industry term for a combined horse track and video slots parlor.

Rock Ohio took the lead with regard to the airport land, said Robert Konstand, an Airport Authority trustee who is also a real-estate attorney and who has been helping the airport during the early negotiations.

The company indicated it would invest “a couple hundred million dollars” and that there could be 500 to 650 full-time jobs created, he said.

Airport officials signed a confidentiality agreement in August and got as far as a draft lease in November for 80 acres and potentially 160 acres on the northwest corner of airport property along Greensburg Road east of Massillon Road.

“Up until two months ago, I assumed it was not going or they were not doing it here,” McQueen said.

Konstand said airport officials have discussed the potential racino with Green Mayor Dick Norton. Rock Ohio also requested that the airport contact the mayor last month to feel out the city’s reaction, he added.

Norton declined to comment for this story.

Konstand said that the mayor asked about the financial investment being made by Rock Ohio, how many jobs would come to the city, how the racino would impact traffic and what type of infrastructure it would take to support the operation. It was clear, Konstand said, though, that Norton did not want the racino near what would be considered downtown Green.

Documents released by the airport on Friday indicate there was a confidentiality agreement signed by Norton regarding the project.

The Akron Beacon Journal has filed a public records request with the city for documents related to the potential project, but Green Law Director Steve Pruneski indicated Friday that an initial search showed the city has no records to turn over.

Airport officials have heard nothing from Rock Ohio since they met with Green.

A Rock Ohio spokeswoman didn’t return an email seeking comment on the potential airport site.

“They have made it clear that there are other sites involved from day one,” Konstand said, adding that they did not know the other locations.

Entertainment complex

Rock Ohio officials have described only in general what they envisioned for the potential site, said Konstand and McQueen. Horses would reside near the track and the main building would house video slots, as well as restaurants.

“They looked at it that it would be entertainment. Instead of going to dinner and the movies, you could go to dinner and the racino,” Konstand said.

Rock Ohio told airport officials that it is looking to move to the Akron-Canton area for its next investment after Cleveland, he added.

When asked whether a racino would be beneficial to travelers who come to the airport from all over Ohio and parts of Pennsylvania for the low fares, McQueen said, “With the operation as they describe it, I don’t think this is going to be a destination for the air traveler.”

Travelers may spend an hour or two at the racino before or after a flight, but McQueen said he doesn’t see the racino bringing in extra travelers for the airport.

While airport officials did not know at the time with whom they had signed a confidentiality agreement and letter of intent, they insisted to know the identity of the potential tenant before taking the documents to the airport board for approval to begin negotiations. That’s when they found out it was Rock Ohio Caesars and Caesars Entertainment.

“We were shocked,” Konstand said.

Potential site

The 80 to 160 acres fronts Greensburg Road and is currently a combination of farmland, open space and a Green youth sports complex, which is on a one-year lease from the airport, said McQueen. There are also a few residences along Greensburg near the site, and documents indicate there could be other property acquisitions necessary.

The potential area is among about 400 acres owned by the airport and not among its plans for operations. The airport has a total of 2,400 acres.

The airport policy is to lease land and not sell it. That way, the airport can use the income to keep fees low for airlines, officials said.

Rock Ohio initially wanted to purchase the land and walked away at one point, Konstand said. They later returned.

The potential 99-year lease set the value of the land at $25,000 an acre, with Rock Ohio paying 10 percent each year for the first 15 years — meaning the airport stood to earn $200,000 a year. After the 15th year, the rent would go up. The revenue would be significant for an entity with an annual budget of $10.8 million.

The agreement, which was still being worked on, also notes that the airport would be prevented from allowing competing businesses or negative signs from being placed on adjacent airport-owned property. Not only would the racino be protected under the deal, but also Quicken Loans, the Cleveland Cavaliers, University of Phoenix and other companies.

Airport officials stressed that language was added in the latest draft of the agreement and they had not had a chance to discuss that with Rock Ohio.

Konstand also said he made it clear to Rock Ohio that the airport would not want the racino to be a potential competitor for airport or off-airport parking.

Green officials know very little about the potential racino, Konstand said.

City must decide

However, Green will be the linchpin in the deal. Any potential deal would also need to be approved by the Federal Aviation Administration to ensure the development doesn’t impede airport operations.

McQueen said the airport will not move forward without the approval from Green and “that’s a deal-killer if the city of Green does not want this.”

“To be quite frank, we don’t want to be the people to make a social decision on whether gaming is correct or not correct,” he said. “Our philosophy has always been that we want to be a partner in the region. In this instance in particular, we knew it was a sensitive subject and even though there are so many uncertainties out there with it, our thoughts were that we don’t want to make a decision for the city of Green.”

Konstand, McQueen and Kristie Van Auken, senior vice president and chief marketing and communications officer, met with the Beacon Journal on Friday to provide details of the preliminary negotiations.

The airport released the letter of intent, two sets of board minutes and a draft of a lease agreement in compliance with a public records request made by the Beacon Journal earlier in the week.

Airport officials said they had been released by Rock Ohio from the confidentiality agreement on Thursday.

Asked whether there are other airports with racinos on its property, McQueen said he knew of airports with slot machines, but none with racinos or gambling facilities.

Relocating to Akron area

Gov. John Kasich is considering a deal that would allow Thistledown to relocate from North Randall in suburban Cleveland to the Akron area. He already has struck an agreement allowing Penn National Gaming to move two of its horse tracks farther away from its Las Vegas-style casinos set to open in Columbus and Toledo.

By moving Thistledown, Rock Ohio Caesars would eliminate some direct competition in Cleveland with its Horseshoe Casino and capture the Akron-Canton gambling market.

Kasich spokesman Rob Nichols said there was no news Friday regarding the potential Thistledown deal.

If approved, Summit County could be home to two racinos. Northfield Park is a harness racing track in Northfield.

Airport officials said they’re in a holding pattern waiting to hear about any movement. Even if a deal is signed tomorrow, the racino is still a few years away, they said.

“We are maybe a potential site, but we don’t know if we are or we aren’t,” McQueen said.