Natchez cashes in after many attempts to get second casinoPublished 12:07am Sunday, December 16, 2012
By Kevin Cooper & Vershal Hogan
NATCHEZ — This week, nearly 20 years after the first legalized dice rolled in Natchez, the city’s second casino is set to open.
When gaming opens Tuesday at Magnolia Bluffs Casino, nearly two decades of attempts to become the second legalized casino come to an end.
It wasn’t for lack of trying by others through the years.
Most local leaders say they’ve lost an exact count of the number of would-be casino operators who came to Natchez with development dreams.
Most agree that at least 10 to 12 is the likely number, including several at a location south of the Mississippi River bridge, several at Roth Hill and even one that sought to bring one to the former Belwood Country Club where St. Catherine Creek flows into the Mississippi River.
What made Magnolia Bluffs succeed when nearly a dozen others through the years had failed?
The answer is two-fold, said former Natchez City Attorney Walter Brown.
“Primarily, including the current one, it always comes down to financing,” Brown said. “I’ve known of five or six proposed contracts or development agreements for Roth Hill alone. We did a bunch of them from 1995 to 2005.
“In addition, this past board of aldermen was probably more accommodating in what they’d provide,” he said. “On the other hand, I will say the rent they’re paying is certainly market value, one million dollars per year.
“I think they just had enough time and the gaming commission let them go ahead and start some things even though they didn’t have it all put together yet,” he said. “They just sort of did it as they went along. The bankers went along with it because they saw they were making progress and ultimately two big investors stepped in and kind of put it over the top, I think.”
Magnolia Bluffs President Kevin Preston agreed, crediting this week’s opening primarily to perseverance through tough economic times.
“A lot of people failed to fight through it,” he said. “We found a partnership with a great private equity group and stuck it out.”
Natchez Mayor Butch Brown said financing was always the problem in the past, mostly because those with deep pockets wound up going elsewhere.
“One of the drawbacks here was having to deal with the river,” he said. “That makes it very expensive with the docking issues and the ups and downs of the river.”
“I think the market grew so fast that investors and developers who had the money to come in and make a meaningful investment have done so in areas with larger populations where the opportunities were greater,” Mayor Brown said.
“The ones who had the vision to come here and do something with this unique site always seemed to be the ones that were underfunded.”
Other failed proposals were perhaps lucky misses for the city. Alderwoman Joyce Arceneaux-Mathis said she traveled to another casino in the state that was owned by a company looking to locate in Natchez, only to later hear that the casino had closed.
Arceneaux-Mathis ultimately saw four casino proposals fail to come to fruition in Natchez before Magnolia Bluffs was able to locate in the city.
“I don’t know whether the timing was bad or the climate was bad, but everything was not coming together (for those casinos),” she said.
At the end of the day, the mayor suggested the timing was simply right this time.
“These folks were able to parlay the groundwork that others had done along the way,” he said. “And when the moon and the stars all lined up, I think it all came together.”
Arceneaux-Mathis also attributed Preston’s industry connections as a reason why Magnolia Bluffs has been successful where others have not.
“Kevin Preston has more connections, I believe, with the casino establishment nationwide than the other people who have come in looking at trying to bring something,” she said.
“I think that Preston’s personality, the personality of (the company) — they have a good community personality — those are also factors that brought them here.”
Casino gaming in Natchez
That it’s taken two decades for a second Natchez casino to materialize is ironic since the seeds of the state’s legalized gaming first were planted in Natchez back in 1989.
“I was out cutting my yard one day; my down-the-street neighbor came up and had a copy of USA Today and said, Iowa has started riverboat gaming, and asked, ‘Why can’t we do that here?’” former state Sen. Bob M. Dearing said.
The neighbor was the late Dr. David Steckler.
“I said, ‘Look, we can’t even pass the lottery, we’re not going to be able to pass casino gaming,’” Dearing said.
But Dearing did as his constituent asked and had a bill crafted that would allow gaming in Mississippi River port cities, with local approval.
“David had no interest in it, he just wanted to see jobs come to Natchez,” Dearing said. “Then the bill stalled in committee; he personally wrote letters to physicians he knew who lived in the hometowns of senators on the committee to ask for their support.”
Eventually, what started as mostly a bill aimed at boosting Natchez tourism picked up statewide steam, Dearing said, eventually passing 22-20 in the Senate in 1990.
The first casino in the state was slated to come to Natchez, Mayor Brown said.
“They were bringing a boat called the Emerald Star for its opening in late 1991 or early 1992, in the interim that’s when they allowed gaming on the Mississippi Gulf Coast. The coast market was bigger and better than Natchez so they just sailed right past Natchez.
20 years by itself
Las Vegas casino developer Andrew Tompkins announced plans in 1991 to bring a casino to Natchez.
When his $8 million riverboat-themed barge was towed into Natchez — although it looks like a riverboat, it has no engine — then Natchez alderman Jake Middleton was watching.
“I was there when the boat floated down the river,” said Middleton, who as mayor from 2008 to 2012 was critical in helping land the new Magnolia Bluffs Casino deal. “I was standing on the bluff when it pulled in.”
When the Lady Luck casino opened in February 1993, it was all the rage in Natchez and the region.
“There was a great deal of enthusiasm among advocates of gaming, and Natchez was a leader in it,” Attorney Brown said.
“When the first one opened up in Natchez, there was nothing over in Shreveport, or down in Baton Rouge and there were no Indian casinos in Coushatta,” Dearing said. “It was a good draw of people to Natchez then. We used to have busloads of people coming here to gamble.
“Then, after these other casinos started opening, and all of these others came on board, the pool of people to draw from just got narrower and narrower,” Dearing said.
That made it even more difficult of a proposition to bring a second casino to Natchez, Dearing said.
Tompkins operated Lady Luck successfully, growing his casino businesses across the country, until 2000, when he sold his company to Isle of Capri Casinos.
“I think the Isle of Capri has done a great job while they’ve been here,” Middleton said, adding that competition is part of business, however.
Roth Hill’s purpose realized
Middleton said some residents forget that the very reason Roth Hill Road was rebuilt and the land at the foot of the hill was reclaimed was to lure another casino to Natchez.
“When we went back in the 1990s and rebuilt Roth Hill Road, that was an attempt to capture a casino,” he said. “It’s taken a long time, but eventually we did.”
Mayor Brown, who was also mayor when Roth Hill’s redevelopment began, agreed.
“Back when we redeveloped Roth Hill, one of the things we proposed to do was to make it a premier, the premier, site for a casino on the river,” Mayor Brown said. “I think we did that.”
For the city, the investment in Roth Hill may finally be realized soon.
“(The city) spent several million dollars on Roth Hill Road,” Attorney Brown said. “And before that it was like a wild jungle. You couldn’t walk down there, let alone drive down there.”
Brown also recalls that despite the former condition of Roth Hill, the city had a casino developer place a one-year option on the site back in 1991 for $25,000.
“But there wasn’t even a road there then,” he said.
On Tuesday, the 20 years of watching and waiting may be complete as the city’s second casino becomes a reality.
It’s a moment that Middleton says is a good thing for the city.
“I’m not one of these old boys who says, ‘I told you so,’ but it’s been a long time coming.
“Nobody could forecast what’s happened in the last four years. It was a tough time.
“I’m a business man and let’s move Natchez forward.”
And like Middleton, Arceneaux-Mathis said she sees a window of opportunity opening for Natchez.
“I am proud to have (Magnolia Bluffs) in Ward 1, just as I am proud to have the Isle of Capri in Ward 1,” she said.
“I believe Natchez could hold three casinos, and we can have a much more beautiful bluff and riverfront area in development than Vicksburg or Baton Rouge.
“I believe we are in the right area at the right period of time, and I believe we are going to move forward.”