Casino rejects offer to buy land for $600 million

Saturday, Dec. 16, 2000 | 10:04 a.m.

Mayor Marc Morial made the offer, which would have ended all direct payments from the casino to the city, as well as extra payments from the state to the city for such items as police and fire protection for the gambling hall. That package totals about $20 million a year.

The city is attempting to deal with warnings from legislative leaders that unless it takes a cut in its casino payments, proposals to cut the casino's $100 million minimum annual state tax are doomed. The concessions will require a special legislative session.

The casino's publicly traded owner, JCC Holding Co., quickly rejected Morial's proposal.

"There is no interest in purchasing the land," JCC Holding president Fred Burford said in a letter sent Friday to Morial.

Burford said the casino was interested in continuing negotiations on city concessions, but warned that time was limited. The casino plans to close April 1 unless it gets a package of concessions including a tax cut, permission to have its own hotel with reduced-rate rooms and unlimited casino restaurants.

In a letter to Harrah's Entertainment Inc. and JCC Holding, Morial said the money would be placed in an investment trust fund for city use. The city also wanted 1 percent of any annual gambling winnings above $250 million.

City representatives said the land deal might satisfy the Legislature, which is being asked to reduce the casino's $100 million annual minimum state tax, while getting the city out of the casino business.

The real estate is at the foot of Canal Street across from the French Quarter and a stone's throw from the Mississippi River.

"It's one of the most valuable parcels of land in the South," said Roy Rodney, an attorney for the Rivergate Development Corp., which acts as the city's landlord for the casino site.

Harrah's Entertainment owns about 43 percent of JCC Holding.

A city-state study committee recently recommended cutting the minimum annual state tax to no more than $60 million and to ease the hotel-restaurant restrictions.

Gov. Mike Foster has said he will not call a legislative session to deal with bailing out the casino until there is widespread consensus of what to do.