Ormsby House gets last chance to sell

Friday, Dec. 20, 1996 | 11:59 a.m.

The commission on Thursday approved a recommendation from the state Gaming Control Board for a gambling license at the Ormsby good only through February. Club owner Barry Silverton said he's hopeful the sale will be completed by then.

"You probably won't have much rope left," Commission member William Urga told Silverton in describing the panel's likely attitude at its February meeting if there's no sale by then to Patriot American Hospitalities Corp. of Dallas.

In their review of the pending deal last week, Control Board members bluntly told Silverton to get on with the sale or face a takeover by the state.

Silverton and his attorney, Mike Alonso, told the Gaming Commission that one problem with the deal is that the buyers are working on scores of hotel acquisitions around the country.

"They have other fish to fry," Alonso said, adding. "These people are from out of state and they don't understand the process." But he also said their Nevada-based counsel should be able to explain the urgency of the situation.

"They don't see it quite the way we see it," added Silverton. "They think they're going at breakneck speed."

In the meantime, Silverton said he'd infuse more of his own money into the Ormsby if needed, and is seeking additional financing as a back-up.

"Believe me, I haven't slept in two years," he said in discussing his efforts to keep the casino going.

"Maybe you didn't sleep at night, but you were sleeping during the day," snapped Commission member Augie Gurrola.

Bruce Dewing, a casino industry veteran hired as general manager by Silverton last April to help fix problems at the Ormsby House, said it is doing much better now although some bills are still behind.

"We were hauling out of such a deep hole," added Dewing, who will stay on with the new management.

Dewing has said he inherited a "mess" when he hired on. The resort had a reputation of not paying bills -- everything from federal and state taxes to vendors who supply food and beverages -- since reopening in early 1995.

Patriot American Hospitalities, which has 45 hotel properties around the nation and recently bought the Bay Meadows horse track near San Francisco for $168 million, has been negotiating with Silverton for several months.

Under the purchase plan, the buyers would lease the casino to Las Vegas-based American Wagering Inc. which is headed by Vic Salerno. He runs Leroy's sports books in casinos throughout the state.

The Ormsby was opened in 1972 by former Nevada Gov. and U.S. Sen. Paul Laxalt and other members of his family, and was later acquired by Woody Loftin. After Loftin's death, his son Truett took over but had to give up the property in a bankruptcy proceeding.

The hotel-casino shut down in January 1993, and the hotel didn't reopen until February 1995, after Silverton bought it. Gaming resumed in October 1995.