Out of seemingly nowhere, Iowa lawmakers voted to add a two-year moratorium on new casinos in Iowa. The amendment passed the Senate by a 35-11 vote and the House by a 60-23 vote and is awaiting Gov. Kim Reynolds’ approval. Officials working towards developing a new casino in Cedar Rapids are now pumping the breaks awaiting Governor Kim Reynolds’ decision. If signed into law, the amendment would go into effect on June 1st.
Earlier this year, the Iowa Racing and Gaming Commission announced it would again accept applications from Linn County for a new casino. The announcement followed the November 2021 vote where voters approved the option to build a new casino in Cedar Rapids. The House State Government Committee Chair, Rep. Bobby Kaufmann (R) states the casino market is at its equilibrium believing additional competitors would cannibalize and over saturate the market. Kaufmann is worried donations made from current casino revenues to non-profit organizations would be affected by more competition.
Other Republican leaders like Dennis Bush (R) said the Cedar Rapids casino didn’t impact his decision at all, expressing the commission just needs more time to determine whether more sports apps and casinos would hurt current businesses. “There are just all these different apps and advertising. How is that going to affect the existing casinos and their revenues?” Bush said.
Other lawmakers disagreed, arguing the decision shuts the doors for communities and non-profit organizations while allowing other communities access. Rep. Steve Hansen, (D) said the decision was “reactive instead of proactive,” and gives other states like Nebraska a growing lead in casino gaming, threatening all casinos in Western Iowa.
Cedar Rapids Mayor Tiffany O’Donnell (R) and local investors are particularly disappointed by the decision. “It’s incredibly disappointing that this can happen seemingly in the dark of night without the city to even have the opportunity to respond,” Cedar Rapids Mayor Tiffany O’Donnell said after the vote. “It’s disappointing knowing the voters wanted the casino, the amount of time, money, and effort from investors as well as from the governor’s appointed Racing and Gaming Commission, that something like this can happen so quickly without any of us knowing about it.”
This is the third time Linn County has attempted to develop a new casino in the area, having failed twice previously, in 2014 and 2017. Rep. Kirsten Running-Marquardt (D) stated the new legislation was “incredibly unfair. . .people have been navigating and working with the Gaming Commission, and then all of a sudden we see a moratorium pop up. We give the power to the Gaming Commission for these licenses for a reason. It’s supposed to be fair.”
The moratorium amendment was introduced by Senator Roby Smith (R) chair of the Senate State Government Committee and is running for state treasurer. Since 2006, Elite Casino has been Roby Smith’s 7th largest donor and recently received $23,000 from Elite PAC (according to the Iowa Ethics and Campaign Disclosure Board) before the moratorium. Elite PAC or Political Action Committee is a part of Elite Casino Resorts run by CEO Dan Kehl. Kehl has casinos in Waterloo, Meskwaki, and Riverside and has criticized the potential for a new casino in Cedar Rapids for years.“
It’s hard to not feel played as a city, it really is,” said Mayor O’Donnell. “We’ve been playing by the rules just like we’ve done in the past. But in the eleventh hour, there seemingly may have been a frontroom, backroom, or I don’t know where [deal]. This came out of nowhere.”