RIVERBOAT GAMBLING REMAINS AFLOAT

Riverboat gambling won't be pulling a disappearing act here like it did in St. Louis, Cape Girardeau city officials say.

Two gambling firms have canceled plans for riverboat casinos on the St. Louis riverfront. They said the city had demanded too much in the way of gambling winnings and required investments in the area.

But Cape Girardeau city officials said that isn't the case locally.

Both Mayor Al Spradling III and City Manager J. Ronald Fischer said they expect Boyd Gaming Corp. to open a floating casino on the Cape riverfront.

The city is waiting to hear from Boyd concerning a final operating agreement. City council approval would be needed before such an agreement could take effect.

Boyd executives couldn't be reached for comment, but Fischer said he spoke with Boyd vice president Maunty Collins about a week ago.

According to Fischer, Collins said the gambling firm was waiting for the Corps of Engineers to approve the casino site on the Mississippi River before finalizing an operating agreement with the city. Corps approval could come next month.

After that, Boyd would have to obtain an operating permit from the Missouri Gaming Commission.

In January, Collins predicted the $51 million gambling development would open by next January.

But Spradling said Friday city officials haven't been given any firm timetable.

"Things are just going a lot slower than what we perceived would be the case and what I think they perceived would be the case," the mayor said.

Still, he said the situation isn't comparable to what happened in St. Louis.

"I am not going to read too much into the St. Louis situation because they have a different deal than we have down here," he said.

Spradling said Cape Girardeau has been reasonable in its negotiations with Boyd.

"I think what we have asked from Boyd and what Boyd has offered to the city have been reasonable sums of money and projects they are going to do for the city," Spradling said.

The city would receive an estimated $2 to $3 million a year in taxes from the gambling venture, he said.

Fischer said, "We have done all our bargaining when it comes to fees and commitments that Boyd will do for Cape."

The city staff has talked at length with the gambling company about everything from needed water and sewer improvements to parking and traffic flows.

Spradling said the situation in St. Louis, which already has one gambling boat and another across the river, suggests that Missouri is becoming saturated with riverboat casinos.

"I think when you saturate the market you obviously cut down on the return that each of the boats would have recovered," he said.

Spradling said Missouri's cities are discovering that riverboat gambling isn't a pot of gold at the end of the rainbow.

"It is a revenue source, employment source and a business source, but how much money you are going to get is questionable and variable," he said.

Southeast Missouri State University economist Bruce Domazlicky said riverboat gambling is a "footloose industry" that can pick up and move elsewhere as the situation demands.

The euphoria of riverboat gambling has waned, and casinos are taking a hard look at such investments, he said.

Rising interest rates will mean increased borrowing costs, which also will make a difference, Domazlicky said.