All Iowa casinos reported in good financial shape

Wednesday, April 5, 2000 | 9:19 a.m.

Jack Ketterer, administrator of the Iowa Racing and Gaming Commission, said audits filed with the commission showing healthy financial figures are a sign of an established state casino industry. He added there may be room for more customer growth in some of Iowa's gambling markets.

"I think this shows there is a need for this type of adult entertainment," said Verne Welch of Council Bluffs, president of the Iowa Gaming Association, a casino trade group. "People enjoy this, and for the most part, they are very rational about controlling the dollars they spend. I have heard many customers say, 'We really don't know what we did before."'

However, Tom Coates of Norwalk, a gambling opponent, contends big profits for Iowa's casinos are bad for families. He believes gambling addictions are causing divorces, suicides and other problems.

"Sure, there is a market for this kind of thing. But that doesn't mean the human misery that always went along with it still doesn't go right along with it," Coates said.

Some of Iowa's gambling businesses measure their finances differently, so the accounting terminology varies. But for the past two years, each measure has shown all state-regulated gambling operations have been making money.

The situation is much brighter than it was earlier in the 1990s, when at least one or two Iowa riverboats were regularly in financial jeopardy. In the worst cases, several eastern Iowa riverboats fled to other states, while racetracks in Waterloo and Altoona filed for bankruptcy.

Peninsula Gaming Co., which purchased the Dubuque Diamond Jo riverboat last year, was the only Iowa gambling operation to report any red ink in 1999. The firm posted a net loss of $2.4 million. However, those figures included an accounting write-off of $3.1 million in start-up expenses, said Peninsula Controller Natalie Schramm.

The Diamond Jo is making money "and we have no problems," Schramm said Tuesday.

Prairie Meadows Racetrack and Casino, operated by the nonprofit Racing Association of Central Iowa, is one of Iowa's strongest gambling businesses. During 1999, Prairie Meadows generated $32.3 million in payments to Polk County and to charitable groups, an audit shows.

Council Bluffs, meanwhile, is Iowa's richest casino market. The Ameristar riverboat posted operating income of $20.9 million last year. Harveys riverboat had operating income of $18.8 million. Between Jan. 1 and Oct. 5, 1999, Bluffs Run Casino had net activity before license fees and income taxes of $15 million. Between Oct. 6 and Dec. 31, after Harveys took over Bluffs Run, the dog track and casino had operating income of $8.2 million.

In the Quad Cities, the Lady Luck Casino riverboat in Bettendorf had net income in 1999 of $12 million. The President riverboat in Davenport has a different fiscal year and won't file its audit until later this spring. However, the President is expected to show a profit, Ketterer said.

Even smaller casino markets did well last year, audits show.

The Belle of Sioux City riverboat had net income of $3 million, while the Mississippi Belle II in Clinton had net income of $7.1 million. Catfish Bend Casino, operating in Burlington and Fort Madison, had net income of $8.2 million. The Marquette riverboat casino in Clayton County, which has had two recent switches in ownership, had total net income of $2.3 million.

The Dubuque Racing Association, nonprofit operator of Dubuque Greyhound Park and Casino, made payments to the city of Dubuque and charities of $9.3 million. The Greater Dubuque Riverboat Entertainment Co., which sold the Diamond Jo last year, had operating income of $4.5 million.