Ameristar terminates pact

Ameristar terminates pact with Lemay casino investors

By BILL MILLIGAN

For the Call

For the second time since signing a 1995 agreement with St. Louis County to develop a gaming boat at the former Na-tional Lead site in Lemay, local investors have lost their ca-sino partner.

Futuresouth Inc. Chairman Dennis Long informed St. Louis County Port Authority Chairman Sheila Sweeney in a recent letter that the agreement between local investors and Ameristar Casinos “has been terminated.”

In the Feb. 26 letter, Long wrote, “The decision not to pursue the Lemay project was Ameristar’s, in the exercise of its termination right under the asset purchase and sale agreement.”

Ameristar Vice President Gordon Kanofsky confirmed the decision in a March 7 letter to County Executive George R. “Buzz” Westfall.

“We could not have asked for better partners than the St. Louis County team and Southboat Ltd. Partnership, and our only regret is that we were not successful in our efforts to bring economic development to Lemay,” Kanofsky wrote.

Futuresouth Inc. and Southboat Limited Partnership were two names that Long and his investors have used to represent their effort to build a casino on 80-acres of land St. Louis County purchased from Kerr Magee Oil Company for $1.95 million in 1987. It has also been known as Southboat Lemay, Inc.

By May, 1988, the Port Authority had developed a master plan for a multi-modal transportation and industrial complex financed by the sale of Tax Increment Financing bonds, state and federal grants, port leases, barge mooring fees, rail users fees and liquid storage and handling fees.

Among the port’s competitors on the Missouri side of the Mississippi River would have been the Slay Bulk Terminals, St. Louis. Owner Glen Slay was among the Futuresouth investors pursuing the casino development as recently as February 2000.

Also among Futuresouth investors are Westfall friends and political allies who immediately prior to Futuresouth’s selection as casino operator had donated more than $130,00 to Westfall’s campaign for County Executive.

St. Louis County granted the company non-exclusive rights to operate a casino on public land on June 8, 1995.

When the lease was signed Oct. 13, 1995, the Casino had an exclusive right to operate in unincorporated south St. Louis County.

That ended an extensive review process begun in 1994 and at one point favored rival Casino America now Isle Of Capri Casinos.

In a letter to the St. Louis County Council dated Apr. 26, 1995, St. Louis County Economic Council Executive Director Dennis Coleman said four key factors weighed in favor of Casino America. Those factors included the company’s willingness to guaranty commitments, ability to finance the project, pledge to begin making rent payments 30 days after licensure and the cash benefits offered.

But the St. Louis County Council asked Coleman to reconsider his evaluation after a May 4 meeting of the St. Louis County Committee of the Whole. On June 8, 1995, the Council approved a non-exclusive lease with Showboat and Futuresouth, Inc.

An exclusive lease between the Port Authority and Southboat Limited Partnership, a company made up of Showboat and Futuresouth, was signed in October, 1995. The document established a 14-month deadline for project start-up.

But rather than begin the project, Showboat Dec. 15, 1997 announced that it was dropping its interest in the Lemay casino project. Futuresouth continued to hold lease for two years until it found Ameristar to partner with in Oct. 1999.

Despite strong backing from St. Louis County which included personal appearances by Westfall and former County Councilman Jeff Waegener, the Missouri Gaming Commission selected a Kimmswick site for review and potential licensing.

That project fell through and Gaming Commission Director Kevin Mullally last week said that the Commission could begin reviewing applications for a casino in the south St. Louis metropolitan region again as early as this summer.

“I don’t expect we’ll be looking at this again until this summer,” Mullally said. “We’ll have new commissioners on board by then. There is some pending legislation that could affect the market.”

Westfall declined to comment on Ameristar’s decision. Rather, he asked Coleman to speak with the Call.

“We cannot state strongly enough how much we appreciate Denny Long’s commitment to getting something done there,” Coleman said.

Coleman said Long’s lease has been on a month-to-month basis.

“There is other interest in other sites, but we don’t own those sites,” Coleman said. “The revenue potential is not as great,” for the County at privately owned sites.

County Councilman John Campisi said he believes continued efforts to locate a casino at the National Lead site is hampering efforts to develop the region.

“It doesn’t seem like a viable site for a first-class casino,” Campisi said. “The roads aren’t adequate. The infrastructure is not there. I think its time they relinquish that lease.”