Louisiana gambling board can OK contract

Monday, March 16, 1998 | 1:55 a.m.

"The Gaming Control Board has independent authority to renegotiate and execute the renegotiated casino operating contract," Ieyoub said in a news release distributed just before an afternoon news conference.

Ieyoub said Gov. Mike Foster by himself cannot OK the contract. But Foster, who backs the latest proposed contract, appoints the members of the board. Moreover, the board has already given its OK to the contract, although the board is sceduled to discuss the contract Tuesday and may try to make changes in it.

Ieyoub's opinion does not have the force of law but is generally used by state officials as a guideline barring specific legislation or a court decision contradicting it.

Legislative leaders asked Ieyoub last week whether either Foster or the state gambling board has the power to accept a new casino contract and get the project started again, after more than two years in bankruptcy court, without legislative approval.

Ieyoub's decision leaves the matter far from settled - casino opponents are likely to go to court if the state moves to re-start the project without a legislative vote.

For a long time, Foster held that he would not OK the pact without a legislative vote, but last week he said he changed his mind. He said he would likely sign the deal if the attorney general says he can, in order to keep the issue from tying up the Legislature and to protect the state from lawsuits by the casino's creditors.

A partnership led by Harrah's Entertainment Inc. opened a temporary casino in New Orleans and started construction on a huge gambling palace in 1995. Revenue was far less than expected. The temporary casino closed and construction was halted in November of that year while the Harrah's partnership sought protection from creditors in bankruptcy court. Since then, a new contract has been negotiated.

Ieyoub's decision frees Foster and legislative leaders to make plans for a special legislative session set to begin March 23 without having to worry whether ratification of the contract will overshadow other issues. Foster must set the agenda by midnight Tuesday.

Legislative leaders have said they don't want the contract included in the session because it will dominate other important issues that need to be considered, such as education and highway reform. Foster had said he would call two special sessions - one to deal with the casino, the other to deal with the remaining issues - had Ieyoub's decision gone against him.

Foster said last week his attorneys have told him that the governor's power to sign contracts cannot be restricted by the Legislature.

Others argue that a 1996 law supposedly requires legislative ratification of a casino contract. Still others interpret the law to say that the gambling board has authority over the casino contract.