Casino owners defend finances

Associated Press

COLUMBUS

Gaming regulators on Thursday questioned a company slated to open Ohio’s first casino next month about one of its owner’s old business practices, as well as the financial stability of another company heavily invested in the project.

Daniel Gilbert, majority owner of Rock Ohio Caesars, addressed members of the Ohio Casino Control Commission during a two-hour presentation about his company’s vision for the Horseshoe Casino Cleveland, scheduled to open in May.

But Gilbert, who also is a majority owner of the Cleveland Indians baseball team, answered questions from the commission about a $60,000 unsecured loan he personally made to former Detroit Mayor Kwame Kilpatrick in 2009. Kilpatrick owes that city more than $800,000 from a criminal case that forced him out of office in 2008.

Gilbert told the commission the loan was “poor judgment” in hindsight. Gilbert never faced criminal charges over the loan, and investigators determined it was not part of an extortion or bribery scheme.

Representatives from Caesars Entertainment Corporation, an internationally known gaming company with a 20 percent stake in Rock Ohio Caesars, also defended its financial stability during the meeting, following a standard investigative report by a gaming consulting group Wednesday that expressed concern over its billions in debt.

They said the company is continuing to improve its finances, including reducing its debt during the last few years. They described the voluminous report, which recommends the commission continue to monitor the company’s debt level, as inaccurate.

But the Spectrum Gaming Group ultimately recommended the commission grant Rock Ohio Caesars an operating license after a financial background report of the company as a whole applauded the financial health of Rock Ohio Ventures, which has an 80 percent stake in the company.

The commission plans its decision on the license May 2. It’s one of four licenses being sought for casinos in Cleveland, Cincinnati, Columbus and Toledo.

The Cleveland facility will feature a 100,000-square-foot gambling floor with 2,100 slot machines, 63 table games and 30 poker tables. It’s expected to employ 1,600 people.

Spectrum’s report also raised concerns about Gilbert’s involvement in sports betting while he was a college student at Michigan State University in 1981. The matter was handled at the university level at the time.

The report also recommended a hearing be held regarding the Cleveland casino’s vice president of finance, Roger Lee Dillard III, over how he disclosed information about his accountant’s license in North Carolina. The company said the executive is addressing the issue.

Spectrum also cleared for a license another business partner in the deal, Lake Ohio Development CEO and former world poker champion Lyle Berman. Berman’s company will own 10 percent of the Cleveland casino.

Casinos are going up in Ohio following approval by voters in 2009. Certain revenue from the casinos will be distributed to public school districts and various support programs, including problem gambling.

Through the joint venture, Rock Ohio Caesars will operate the Cleveland casino and another in Cincinnati slated to open in spring 2013.

Penn National Gaming plans to open its Toledo casino within a few weeks after Horseshoe Casino Cleveland, with its Hollywood Casino Columbus to follow in the fall.