Board weighs Emerald proposal

Joe Biesk

Thursday, June 27, 2002 | 10:02 a.m.

CHICAGO -- Emerald Casino investors would get their money back and the company would surrender its gambling license under a proposal Illinois officials considered Wednesday.

Gaming Board officials delayed making a decision on the plan until Monday to collect public comment.

Board attorney Robert E. Shapiro said rebidding Emerald's license could earn the state hundreds of millions of dollars.

However, even if the board accepts the proposal, its future is uncertain.

Attorney General Jim Ryan has said he would not approve any casino settlement and wants the board to complete a hearing to revoke Emerald's license.

"The attorney general has not approved this," Ryan spokeswoman Lori Bolas said.

The board has rejected previous settlement offers, including some that would have sent hundreds of millions of dollars to the state.

The future of Emerald's license has been in limbo since January 2001, when board members rejected the company's request to move from a shuttered site in East Dubuque to Rosemont, near O'Hare International Airport.

Board members alleged then that Emerald executives Donald and Kevin Flynn lied to investigators and that some investors had mob ties.

Rosemont and five companies that did work on the casino site there have filed a lawsuit seeking to force Emerald into bankruptcy.

Rosemont attorneys claim Emerald owes the village $44 million for breaching a lease agreement. The five businesses claim they are owed an additional $2 million in fees and expenses for work begun after the Legislature passed a 1999 law allowing the casino in Rosemont.

Under the agreement announced Wednesday, the next license-holder would have to assume as much as $150 million of Emerald's debt, Shapiro said.

C. Barry Montgomery, an attorney for Emerald's shareholders, said the plan at least resolves the issue. The settlement, however, is "absolutely not" good for shareholders.

"A bad settlement is always better than a good lawsuit," Montgomery said.

The settlement would launch a "fair, open and competitive" bidding process, Shapiro said. Rosemont would not be guaranteed the license, nor would it be prohibited from becoming home to a casino, he said.

"No prior arrangements, no secret deals, nobody with a leg up," Shapiro said. "Everybody on an even footing."

Still, Tom Grey, director of the National Coalition Against Legalized Gambling, said he thinks the deal steers the license to Rosemont.

"I mean come on. Let's get real here ... This was a done deal," Grey said.