Missouri regulators to temporarily take over Casino Aztar

Sunday, November 5, 2006

The Associated Press

JEFFERSON CITY, Mo. -- The Missouri Gaming Commission is usually in the business of regulating casinos, not running them.

But the commission voted unanimously Friday to take over a southeast Missouri casino until a licensed buyer can be found.

Gene McNary, the commission's executive director, said the unusual move was necessary to save jobs -- and revenue from the $6 million in fees and taxes paid by Casino Aztar.

The Caruthersville casino is owned by Phoenix-based Aztar Corp., now in the process of being sold to Columbia Sussex Corp. of Fort Mitchell, Ky. Columbia Sussex, which has had difficulty obtaining a license in Missouri, plans to sell the casino.

However, no buyer could be found and licensed by the Nov. 19 deadline.

A planned sale to Fortunes Entertainment LLC was terminated Friday by mutual agreement, Aztar said.

"We're the reason they couldn't sell it," McNary said, "and so it behooves us to find a solution, so that the community doesn't pay the price."

'Interim caretaker'

The agreement was approved Friday. It calls for the appointment of a supervisor to run the casino for up to nine months. McNary said Clarence Greeno, the commission's gaming enforcement manager, would be appointed.

However, George F. Stadler, now the casino's general manager, would keep his position.

"We have no role except to be an interim caretaker," McNary said.

The state can recoup up to $20,000 per month to cover the supervisor's salary and other costs, and can recoup more if costs run over.

Bill Eadington, director of the Institute for the Study of Gambling and Commercial Gaming at the University of Nevada in Reno, said he has seen at least two similar cases in that state.

"These are typically situations that can work adequately in the short term, but can become problematic if allowed to continue for longer periods of time," Eadington said.

"It's a priority for us. We want to see that boat stay open," Hauswirth said. "It's a regional employer, probably one of the biggest employers in Southeast Missouri."

Aztar is also pleased with the arrangement, the company's special regulatory counsel said.

"It's an opportunity to keep 300-plus people employed in Caruthersville and keep an important part of that community's base open," said St. Louis attorney Tom Campbell. "There is an absolute commitment of good faith by all parties involved, and we're going to make this work."

But Mark Andrews, an official with Casino Watch, said regulators should not be involved in making decisions about a casino's profitability.

"This is the ultimate fox guarding the henhouse," Andrews said.

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