THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Wednesday, January 18, 1995 TAG: 9501180440
SECTION: LOCAL PAGE: B4 EDITION: FINAL
SOURCE: BY TONY WHARTON, STAFF WRITER
DATELINE: NEWPORT NEWS LENGTH: Medium: 90 lines
The City Council, deeply split over whether casino gambling is good for the city's future, gave the nod Tuesday to a large national casino developer to build an $85 million riverboat gambling operation here.
That is, if the General Assembly allows riverboat gaming to move forward, if state or local voters approve it, and if Newport News wins one of the licenses to have riverboats.
If all that happens, the Aztar Corp. of Phoenix, owners of the famed Tropicana casino hotel in Las Vegas and TropWorld in Atlantic City, would locate one $17 million riverboat casino in the James River off downtown Newport News. The company also would build a hotel and other facilities onshore.
City development officials and part of the council enthusiastically supported Aztar at the announcement Tuesday, but some council members were still uneasy about embracing casino gambling.
The council was divided over questions of how a casino might affect local businesses, what signals such development sends to residents, and whether the decision should be left to voters.
For Councilman Joe S. Frank, the decision was simple. ``My personal preferences as to whether I participate in gaming or not, or how I feel about it, wasn't really relevant,'' he said. ``I don't see it as a panacea. My job is simply to inform the public and let them decide.''
Frank and three other council members voted to go ahead with Aztar, with the expectation that there will be a citywide or statewide vote on the issue. Mayor Barry E. DuVal and two council members voted no because they object to casino gaming, not Aztar.
Councilman Vincent T. Joseph said, ``Gaming threatens the fundamental belief that you get ahead through good, honest labor. It tears all that down. It's a quick fix. It preys on greed and selfishness.''
He argued it would hurt other local businesses because residents have only a certain amount of money to spend. Joseph also said he feared the public would see the council's vote as an endorsement of casino gambling in general.
Aztar supporters said Virginians have come to terms with gambling already, by approving the lottery and betting at horse races.
In addition to Newport News, the cities of Hampton, Richmond and Norfolk have reached agreements with riverboat casino operators. Portsmouth is still negotiating.
The announcement at Newport News-Williamsburg International Airport followed months of arduous negotiations between the city and six casino operators. City negotiators put in 15-hour days over the weekend as the field narrowed to two companies, Aztar and Showboat Inc.
``We lived on cookies and coffee for four days,'' said Robert E. Yancey, a member of the Industrial Development Authority.
Like other cities, Newport News has had to deal with the possibility of financial ties between its officials and the casino applicants. Alan Witt, chairman of the development authority, withdrew from the selection process because of business his accounting firm had with casino investors.
All other IDA board members filed full financial statements.
The deal finally struck between Newport News and Aztar could bring tens of millions of dollars into city coffers.
It starts today with a non-refundable, $100,000 ``selection fee'' from Aztar.
Aztar will pay the city another $100,000 if casino gaming legislation passes the legislature, $3 million for community development, $250,000 for a minority business loan program, and $1 million for roads. Including taxes, the city estimates it would receive a minimum of $53 million over the first five years.
Aztar was one of the clear front-runners among the six companies making proposals, city officials said. Aztar is the company formed in 1989 when the Ramada hotel chain split off its casino gambling interests.
Aztar and Showboat Inc. had the deepest pockets by far, officials said, agreeing readily to the city's numerous financial requirements.
The city scored each company for its financial strength, experience, management, marketing, and ``corporate citizenship.'' Out of 100 points, Showboat made a perfect score and Aztar was less than half a point behind.
But Aztar succeeded, officials said, because of its consistent commitment to hiring minorities and giving contracts to local companies. Aztar also never tried to oversell the city on the profits its casinos would bring, they said.
The next step for Aztar and Newport News is getting riverboat gaming through the current General Assembly session.
Such bills died in earlier sessions; Newport News officials said they think the proposal is closer to passage this year. ILLUSTRATION: Photo
``I don't see it as a panacea,'' Councilman Joe Frank said of
riverboat gambling. He was one of four council members to approve
Aztar's casino bid.
by CNB