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Penn National Backs Off From Casino Plans in Kansas

On September 11th, 2008, Penn National Gaming Incorporated said that its proposed casino facility in Cherokee County could not adequately compete with a casino facility so close to the state line in Oklahoma that its parking area is in Kansas. Penn National Gaming blamed the provisions on a Kansas Law passed last year that allows a single-state owned casino in each of the four counties in the state, saying that it required too big an investment. The organization said that another factor was their failure to win a contract for a Sumner County casino.

Just last month, a state casino review board approved a contract for the Cherokee County Casino between Penn Gaming, based in Wyomissing, Pa., and the Kansas Lottery, which would own the new gaming. Penn would have invested $225 million over twelve years on the project.

Penn National Vice President, Eric Schippers said that the Quapaw Indian Tribe already enjoyed a significant competitive advantage, including lower tax rates and opening their gaming facility first. Penn National had embarked on a southern strategy, linking their gaming proposal in Cherokee County to its proposal to open a casino facility near Wellington located in Sumner County.

Penn said that having two casino facilities would make the operation in Cherokee County stronger financially. But for Sumner County, the Kansas Review Board choose a group headed by Harrah's Entertainment Incorporated, with a location near Mulvane. Penn National Gaming then hinted that it might pull out of the casino project in Cherokee County casino project. Southeast Kansas state legislators and officials have pushed for casino facilities since the early 1990's.

Last year's law not only gave permission to the casino facilities but to placing slot machines at dog and horse racing tracks like the closed down Camptown Greyhound Park outside of Pittsburg. Both Camptown and the Lottery Commission have been unable to agree on a contract for slot machines at the racing track. Phil Ruffin Sr., whose organization owns Camptown, also blamed the law, which requires forty percent of slot profits to go to the state.


10/05/2008 05:11 PM


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