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In 15 years, Iowa gambling industry grows up and keeps growing

Dave Rasdal

The Gazette

September 3, 2006

[Note: This material is copyright by The Gazette, and is reproduced here as a matter of "fair use" for non-commercial, educational purposes only. Any other use may require the prior approval of The Gazette.]

  By now, Iowa’s gamblers are well versed in the intricacies of the games. They know when to double down at blackjack, play the pass line in craps and that to win the big jackpot on a slot machine, you play the maximum number of coins.

  As Kenny Rogers sang, they know when to hold ’em, know when to fold ’em.

  But 15 years ago — before April 1, 1991, to be exact — Iowa was virgin territory to Las Vegas-style gambling.

  We’d had dog racing, horse racing and lottery tickets for about six years. Then riverboats and slot machines steamed into town, and it hasn’t been the same since.

  Just last week, the brand new Riverside Casino & Golf Resort opened, bringing another 1,200 slot machines, 30 table games and a poker room to the gamblers’ mecca called Iowa.

  By the time the latest expansion of gaming in Iowa is complete next spring, we will have 20 casinos.

  I’ve seen it all happen, from sitting in the stands to watch the dogs run at opening night of Dubuque Greyhound Park on June 1, 1985, to buying early Powerball tickets, to hoping aboard the Casino Belle as it paddle-wheeled up the Mississippi River to Dubuque for its official opening on April Fools’ Day 1991.

  It has been no joke.

  Last fiscal year, ending June 30, gamblers fed almost $13.7 billion into Iowa’s 14,303 slot machines and wagered another $496 million at 395 table games.

  According to the Iowa Racing and Gaming Commission, that meant $1.15 billion in adjusted gross revenue for the 15 casinos then in operation under the jurisdiction of the commission. Those figures do not include the three Indian-operated casinos in the state. That total will almost certainly increase with the Riverside casino now open and another scheduled to open in Waterloo next spring.

  Compare that with the first year, when gamblers plunked down just more than $82 million at the five riverboat casinos in Iowa, and you see how rapidly the industry has grown.

  If you want more recent evidence of the phenomenal growth, just look at the figures for the new Diamond Jo Casino near Northwood, in Worth County along Interstate 35 at the Minnesota border.

Open just since April 6, this casino welcomed more than 335,000 visitors who stuffed $185.5 million into slot machines and $7.8 million at tables games, giving the casino an adjusted gross revenue of almost $16.9 million in just under three months.

  ‘‘We’re definitely outpacing our projections,’’ says Carrie Tedore, 39, director of public relations for this and the Diamond Jo casino in Dubuque. Tedore said the casino, in its first four months, has given $1 million to Worth County Development Authority, its charitable co- licensee. The projections for that money, that goes to nonprofits in the community, had been for $1.2 million to $1.5 million for the whole year.

  Already, the casino is undergoing an expansion that will add another 100 people to its work force of 380. It will increase its 577 slot machines to almost 900, add another 11 table games and include a poker room, a buffet and dance floor. A 104-room hotel is scheduled to open in November.

  ‘‘We want to be more than a gaming place,’’ says Jesus Aviles, 52, general manager. ‘‘People come to eat at the cafe, to meet friends and to socialize as well as to gamble.’’ Aviles, in the gaming business for 33 years with some experience in Atlantic City, says the expansion is necessary because patrons were waiting in line to use slot machines on weekends.

  Ah, yes. That’s how it was in the early days, people jamming the narrow riverboats to play their favorite slot machine or table game. If you’re claustrophobic, it wasn’t the place to be.

  Today, that aspect on those riverboats hasn’t changed.

  However, you’re no longer faced with the $200-per-person loss limit per cruise and the $5 maximum bet. And, with the rare exception of the Mississippi Belle II in Clinton, the boats no longer cruise.

  The Diamond Jo in Worth County represents the new wave of Iowa casinos. The exterior resembles an old-style mill with a turning waterwheel to the right of the main entrance. With 30,000 square feet of gaming space, plus another 30,000 square feet for restaurants and entertainment, it seems as spacious as a Las Vegas casino.

  Walk inside and the bright lights and sounds of slot machines hit you first. Then, off to the left, you notice a Starbucks Coffee outlet and beyond that a Burger King.

  Yes, you can get fast food and take it on the gaming floor with you so you don’t miss a beat. If you decide to relax at the Big Wheel Bar, you’ll notice a video poker game built into the bar at each seat.

  While smoking is allowed everywhere, you hardly notice due to a high velocity air handling system that recirculates the air through water.

  At the Ultimate Texas Hold ’em table, Jeff Weihe, 22, of Truman, Minn., places three $5 chips on the table and lets the cards fall as they may. He drives more than an hour to visit the casino, sometimes staying the weekend with friends. He has walked out with $400 in winnings.

  ‘‘It ain’t too bad,’’ he says, placing another bet. ‘‘I like live poker better.’’ Norma Allen, 53, of nearby Coulter, visits the casino about once a week rather than driving to Prairie Meadows in Des Moines every other month.

  She usually plays the quarter slot machines and has won a $2,500 jackpot.

  ‘‘It’s nice,’’ she says about the casino. ‘‘It’s really clean.

  The people are really, really nice.’’ Aviles, who sees this area being developed as a midpoint attraction between Des Moines and Minneapolis, has good things to say about how the state’s casino business has grown.

  ‘‘Iowa does it right, absolutely,’’ he says. ‘‘Iowa is very industry- friendly in making sure that both regulators and policymakers realize the contributions gaming makes to Iowa.’’ If Aviles could change anything, it would be to repeal the requirement that a county’s voters must reapprove each casino every eight years. He says that regulation can make some investors hesitate about pouring millions into casino renovations or expansions.

  Then again, he admits, casinos have done well in the last 15 years and projects are under way all around the state, including a $60 million expansion at Prairie Meadows and a $111 million expansion at the Meskwaki Bingo-Casino-Hotel near Tama.

  ‘‘I see a great future for the industry,’’ he says.