La Crosse Tribune: casino gamble: Jo Daviess leader says riverboat dealt empty promises, The

When the Silver Eagle riverboat casino landed in Jo Daviess County, Ill., in 1992, county officials thought it was the goose that laid the golden egg.

With the promise of more tourists and 5 percent of casino revenues, officials agreed to spend more than $3 million on infrastructure to bring a gambling boat to their side of the Mississippi River.

But a few years later, the boat was gone - its owners searching for higher profits elsewhere. And local officials were left with higher bankruptcies and other social problems.

"We had 400-some jobs. Now we have none," said Darrell Barkow, president of East Dubuque Savings Bank.

"I was pretty gung-ho" about the casino in the beginning, said Bill McFadden, the county board chairman. "We got $8.2 million over a 4- to 4 1/2-year period."

But now, McFadden's had second thoughts.

"How much is it worth to see X number of families go down the tubes?" he said. "The more available (gambling) is, the more compulsive gambling you're going to have. It is addicting. It is compulsive. Some can handle it. Some can't."

"They littered our landscape with addiction, bankruptcy, crime and corruption and then sailed away leaving a wake of broken promises," said the Rev. Tom Grey, a Methodist minister who fought the riverboat casino in Jo Daviess County. "So much for economic development and a painless revenue stream."

In 1991, Iowa became the first state in the nation to allow riverboat gambling. Despite restrictions such as a $200-per-day limit on wagering and gambling only while the boat was on a several-hour cruise, tourists flocked to the boats in economically hurting Mississippi River towns such as Dubuque and Davenport.

Illinois politicians watched enviously and quickly moved to open their side of the Mississippi to riverboats as well. And they raised the ante - no daily wagering limits.

In 1991, the Jo Daviess County Board decided, without public discussions, to grant docking rights to a group of casino promoters from suburban Chicago who wanted to operate a riverboat in East Dubuque.

With Grey as their leader, casino opponents put three advisory referendum questions on the ballot in March 1992. In various ways, the referendums asked whether the county should support a riverboat casino. The casino promoters spent $30,000 on the election, compared with $500 spent by the anti-gambling group, Grey said. On election day, 61 percent of eligible voters turned out, and more than 80 percent said they didn't want a casino.

"The county board said the people didn't really understand what they were voting on," Grey said. The board went ahead with plans for the riverboat, which opened in June 1992.

Located in the beautiful rolling hills of Northwest Illinois, Jo Daviess County is best known for historic Galena, the one-time home of President Ulysses S. Grant. Less well known is East Dubuque, a gritty river town. The county, population 21,800, gets about 1.4 million visitors a year.

"We're 150 miles from Chicago, and we assumed most of the clientele would come from Chicago," said McFadden, a dairy farmer who has been in county government for 22 years.

Grey said local tourism officials initially believed the Silver Eagle would bring more visitors to the area and "put more heads in beds." But at is turned out, "most of the clientele came from a 40 to 45 mile radius," McFadden said.

"Their first ad in the Chicago Tribune had the theme of Country Inns, Christmas Carols and Casinos'," which Grey said was a contradiction that hurt the area's image. "You can't market yourself as a gambling destination without hurting other aspects of your community."

Despite those problems, the Silver Eagle cleaned up. "Dubuque had a $200-a-day limit, so our boat flourished for a few years," McFadden said.

"They drove the Iowa boat out," Grey said. In 1993, the Silver Eagle had a virtual monopoly on casino gambling in the tri-state area but was only using 600 of the 1,200 gaming positions allowed by its license, Grey said. Owners tried to split their license and open another casino somewhere else in Illinois with the 600 unused gaming positions.

In 1994 the riverboat returned to Dubuque when Iowa revised its rules, eliminating the loss limits and allowing dockside gambling. Illinois casinos wanted state lawmakers to allow dockside gambling, and in 1995, before the vote, the East Dubuque owners closed the boat and laid off all the workers without warning.

"They were told if they didn't reopen, they would lose their license," Grey said. They reopened in 1996 with the old restrictions.

During the period the casino was open, the county saw "a rise in the number of bankruptcies and the number of cases our social workers treated as far as compulsive gambling," McFadden said. "They had reasonable food, which hurt some of our restaurants. They complained their business has gone down."

Barkow said that as a community banker he saw an increase in bankruptcies due to gambling losses but said the number wasn't large. "The anti-gambling zealots predicted the riverboat would bring crime and prostitution, but they never came. We had some fraud and embezzling, but not a large amount."

The riverboat closed again in 1997, and state regulators moved to strip it of its license. Then last year the investors, with help from other gambling interests, persuaded state lawmakers to include a change in gambling laws that essentially required the Gaming Board to let them build a new casino on a floating barge in Rosemont, Ill. That license change, however, is still pending because another group that wants the Rosemont license has sued.

The Silver Eagle went south, leaving the county with a large dockside facility but no riverboat. The county later sold the water and sewer system it put in for the Silver Eagle to the city of East Dubuque for $1.

Barkow says some good did come out of the casino. The $3.4 million the county spent for infrastructure brought sewer and water service to an industrial park, where there are more than 200 new jobs, he said. "The county was smart enough to put the money into infrastructure," he said.

"If we made a mistake, we didn't require enough resources from the boat to take care of compulsive gamblers and to go to social service agencies," McFadden said. "County boards tend to look at revenue, not the other side of the issue."

If a community decides it wants gambling, "be smart about it," McFadden said. Gambling promoters "will tell you you're not going to have problems, but be prepared for it. People are going to need help. Build a safety net."

When a community brings in a casino, McFadden said, "What you do is take money from a large number of individuals and put it in the hands of a small number of people. You make the rich richer at the expense of people who can't afford it."

McFadden's county is just over the border from Wisconsin, and his dairy farm is in the northern part of the county, so he has a good view of local government in Wisconsin. Using casino money for property tax relief "is a big carrot for Wisconsin," he said.

However, McFadden has this advice: "They need to wire it down. If it gets into government's hands, it tends to get spent for things."

Despite Grey's failure to keep the riverboat out of Jo Daviess County, he became involved with antigambling groups elsewhere in Illinois and other states. Today, Grey is executive director of the National Coalition Against Gambling Expansion.