Casino’s non-gaming contribution will be on-site facilities

Published 12:01 am Saturday, January 7, 2012

Ben Hillyer/The Natchez Democrat — Sparks fly as Cedric Ragas from Rene Cross Construction grinds down steel recently delivered by barge to the site of the new Roth Hill casino. The steel, at top, will be used to stabilize the riverbank for the construction of the casino.

NATCHEZ — The Roth Hill Road casino developers plan to meet a legal requirement for non-gaming investment not through a hotel, recreation center or other free-standing structure, but through on-site restaurants, bars and entertainment venues.

The Mississippi Gaming Commission requires that all casino developments spend an amount of money equal to what they spend on the gaming facility on “infrastructure facilities.” Plans for these facilities — which must amount to 100 percent of the construction cost of the casino — must be provided to receive gaming commission approval, something the Magnolia Bluffs Casino received in October.

Gaming Commission Executive Director Allen Godfrey said non-gaming infrastructure can include restaurants, golf courses, marinas, tennis complexes and other such facilities approved by the commission.

The previous owners of the Isle of Capri in Natchez purchased an existing hotel property on Canal Street to meet the requirement.

Parking garages, city parks, sewage systems or other civic facilities normally provided by municipalities do not qualify as non-gaming infrastructure, Godfrey said.

According to the minutes from the commission’s meeting last October, Natchez Enterprises plans to spend $12.56 million during the construction phase on gaming-related projects. The group plans to spend $12.85 million in construction on non-gaming projects.

The entire cost of the project — including the land lease and non-construction expenses — is estimated to be $42.2 million.

Premier Gaming attorney Chris Pace of Jones Walker in Jackson did not provide requested documents included in the gaming commission application that outline specifically what the casino group is counting as gaming and non-gaming infrastructure.

But Pace said in addition to restaurants, bars and entertainment venues, the casino is counting other non-gaming casino space toward the requirement.

Pace said the casino, gaming devices, parking garage and all other gaming-related expenses total $16.79 million.

In addition to infrastructure plans, Natchez Enterprises had to provide the gaming commission with evidence that agencies such as the U.S. Coast Guard and the U.S. Army Corps of Engineers, as well as local government bodies, had been notified and did not oppose the project.

Letters from the Coast Guard and USACE, provided by Premier Gaming Group’s President Kevin Preston, indicate approval for the project. The USACE letter addressed to Preston dated Oct. 19, 2011, awards a permit for construction work at the casino site.

Godfrey said the commission’s approval is dependant upon the notification of the appropriate agencies, and the commission considers all objections during the approval process.

Godfrey said, however, a casino company’s approval is not contingent on the approval of all aspects of the project by municipal agencies, such as the Natchez Preservation and Planning commissions or the Board of Aldermen, because no actual construction has started at the site at the time of approval.

The commission’s job, Godfrey said, is to ensure the company’s proposed project is compliant with state regulations. He said the authority to decide what is best for Natchez is left up to local agencies.

“I don’t think the preservation commission or any other agencies would appreciate us doing that for them,” he said.

Changes to the exterior look of the casino, Godfrey said, are subject to the local regulations, and any drastic changes or any “material” design changes would need to be brought to the gaming commission for approval.

Godfrey said a material change, for example, would be switching the support of the casino from pylons to a barge.

The proposed casino plans also show a public park on Roth Hill Road near the casino. The park, however, is not part of the infrastructure requirements regulated by the gaming commission.

The park is a requirement of the city’s 50-year lease development agreement with Natchez Enterprises initially drafted in 2007. In addition to the park, and contingent upon its agreement with the city, the company must also pay:

• A $1 million donation toward a YMCA, community recreation center or Civil Rights museum.

• A maximum of $300,000 to complete the Natchez Trails Project.

• $225,000 annually to a community development fund.

• An annual minimum base rent of $1 million or 4.5 percent of the company’s gross gaming revenue and all applicable local and state taxes.

Mayor Jake Middleton said the $1 million donation could possibly be used for the recreation complex that city and county officials are hoping to move forward on this year.

City and Premier Gaming attorneys met Thursday to discuss a payment schedule for the items in the lease. Middleton said he will present the schedules to the aldermen for consideration at their meeting Tuesday.

Premier Gaming will present final changes to the casino’s exterior to the preservation commission Wednesday for approval.

The project will then go before planning commission and finally the aldermen, who have final authority for approval.