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Bankruptcy filings don’t mean end of New Castle racino
The filing protects Valley View Down’s credit, a company spokesman said.
NEW CASTLE, Pa. — Wednesday’s bankruptcy filings for Valley View Downs, as well as two other gaming establishments the Indianapolis-based Centaur LLC owns in Colorado and Indiana, does not mean the end of the proposed Valley View Downs racetrack/casino on U.S. Route 422 in Mahoning Township, company officials say.
Kurt Wilson, Centaur’s Chief Financial Officer said Thursday, “We want to dispel the thought that this is a deteriorating situation for Valley View Downs.”
In fact, Wilson said the project could be “up and running” in 2010 and that ground could even be broken in the spring if financing is obtained.
He said the bankruptcy filing is intended to strengthen Centaur’s financial situation, which would “clear the path for new financing” and take advantage of the current situation in the credit markets. He said the bankruptcy filing was needed to protect a $50 million line of credit that Centaur must have available to pay the licensing fee for Valley View Downs if its casino-slots license is approved by the Pennsylvania Gaming Control Board. The letter of credit was scheduled to expire Friday but will now continue uninterrupted because of the filing, he said, protecting the status of Valley View Downs’ pending casino-slots application.
Wilson said that the Indiana and the Colorado facilities are healthy and generating enough cash for operational needs but not enough for their debt obligations. He blamed the situation on the decline in the economy, delays in the Valley View Downs project and heavy tax and fee burdens.
The three facilities were tied together in a $1 billion financing agreement that included the estimated $455 million Valley View Downs project as well as continued operations at Fortune Valley Hotel and Casino in Colorado and the Hoosier Park Racing and Casino in Indiana. But financing for the Valley View Downs portion of the loan fell through in September 2008 after Centaur tried unsuccessfully to get a conditional-slots license to satisfy lenders while waiting for the final approval. Since then, Centaur has been trying to secure new financing for the project.
Doug Harbach of the Gaming Control Board agreed Thursday that Wilson’s time line for opening the facility is not impossible if Centaur obtains new financing. If it does, the board would resurrect the suspended background investigation required of corporate entities and individuals involved with slots licenses. He said that issuance of a license would depend on how long this took and noted that it could be quick because Centaur would not be starting “from zero” since much of the investigatory work already has been done.
He noted that there is no change in their status as applicants but that the bankruptcy is being looked at by the Gaming Board’s Bureau of Licensing and its Bureau of Investigation to see if there will be any effect on the application.
The license, if approved, would allow Valley View Downs to operate 3,000 slot machines at the track for which a harness-racing license already has been approved.
The project has virtually unanimous support in the area because of the jobs it would bring as well as significant revenue to local schools, local and county government. Lawrence County Commissioner Dan Vogler said Thursday that commissioners participated in a conference call with Centaur on Wednesday and they are convinced Centaur is “committed to seeing the Valley View Downs project to fruition.”