A possible settlement agreement between the City of Peoria and the parent company of the Par-A-Dice Hotel Casino was voted down Monday, leaving the city open to contesting plans for a $160 million overhaul of the existing riverboat gambling venue in neighboring East Peoria.
“I am in favor of fighting this out,” said council member John Kelly.
During a lengthy special meeting, the Peoria City Council voted 5-5 with one absence, rejecting a proposal that would have seen the city receive 2.25% of the redeveloped facility’s reported adjusted gross revenue annually, estimated at around $1.8 million.
“I can’t help but to say I’m disappointed,” Mayor Rita Ali said after the vote. “This was a rare opportunity for us.”
The estimated $1.8 million annual payment would’ve been on top of the existing 50% split of gaming revenues between Peoria and East Peoria as stipulated in the 1991 intergovernmental agreement between the municipalities.
A provision in that intergovernmental requiring any land-based casino in the region to be built in Peoria has been the major sticking point, thus creating the likelihood for a legal battle over Boyd’s intent to keep the new facility in East Peoria.
Kelly was joined by Tim Riggenbach, Zach Oyler, Kiran Velpula and Alex Carmona in opposing the settlement. Denis Cyr did not attend the meeting.
“Boyd is the second owner of the Par-A-Dice, let’s not forget that. They bought it after the intergovernmental agreement was put in place. If they didn’t realize the covenants that are involved with that, that’s on them, not on us,” said Riggenbach.
“I’m flabbergasted that this is such a point of contention.”
Instead of remaining on the Illinois River itself, Boyd’s proposal for a “riverboat modernization” would see the new casino development built on top of a 1,000-gallon manmade basin filled with water drawn from the river.
“I wish we could get to a point where we all agreed that a riverboat actually floats on a river, and that’s undisputable,” said Riggenbach.
Boyd outlined its redevelopment plans during a December meeting of the Illinois Gaming Board. The agreement between Peoria and Boyd comes ahead of the gaming board’s Thursday morning meeting, when a decision on the Par-A-Dice proposal could be announced.
“It was clear to us, in speaking on many occasions with the administrator of the [gaming] board, that there’s a significant risk that the board would approve Boyd’s proposal,” said city attorney Patrich Hayes.
Hayes said that while the city may have a sound legal argument, it could take millions in legal expenses and up to 3-4 years if the case is appealed all the way to the Illinois Supreme Court.
“There’s a significant chance that the City of Peoria could successfully challenge this proposal. However, that outcome wouldn’t create any requirement on Boyd or the Par-A-Dice to redevelop their property in any way,” said Hayes.
“There’s no set of circumstances under which Boyd would locate in Peoria; they’ve made that position very clear.”
Proponents of the settlement admitted it was a difficult decision, but the positives would outweigh the negatives.
“If we’re going to avoid spending all those attorneys’ fees and waiting years to even begin building a casino, whether here or there, I’m more inclined to take it,” said Mike Vespa. “I’m kind of risk-averse, as most attorneys are by nature, so I do lean toward the ‘bird in the hand,’ instead of chasing the ‘two in the bush,’ which could leave us empty-handed.”
In response to a question from Denise Jackson, Hayes said drawn out legal proceedings could put a strain on city finances.
“The City Council provides a generous outside counsel budget for the legal department to operate every year. It’s no doubt that this would put pressure on that budget for this year and next year,” said Hayes. “We have other major litigation matters that are pending.”
Carmona said rejecting the settlement could prompt Boyd to offer an agreement with terms that would be better for the city.
“Boyd doesn’t want this to go to the Supreme Court, the way we don’t want this to go to the Supreme Court,” he said.
“We’re over here thinking about worst case scenarios, about spending around a million dollars to get this litigated, to prove that we are right. I don’t want this to be litigated like all of us, but I think it’s important for us to stand up and to get more out of this deal than what we’re getting now.”
In her support for the agreement, Ali said she’s committed to fighting for Peoria’s best interests and characterized the settlement as a good business decision.
“Even if we go to court, spend millions of dollars, spend years, even if we win, what does that look like? It doesn’t get us a riverboat; it doesn’t get us a land-based casino in Peoria,” she said.
“It still doesn’t get us that casino, it doesn’t guarantee us that. It just means we were right. That’s not a win, for me.”
