Davenport Aldermen Approve Pursuing Buying Rhythm City - News and Weather For The Quad Cities -

Davenport Aldermen Approve Pursuing Buying Rhythm City

Updated: Oct 24, 2012 10:24 PM CDT

The City of Davenport is placing its bets on owning a casino. Aldermen voted to pursue buying Rhythm City Casino by allowing the Mayor to sign a purchase term sheet.

The term sheet allows the city to outline terms for a potential transaction. It also gives city leaders the ability to discuss the transaction, with the community, RDA, Iowa Racing and Gaming Commission, and potential developers. The term sheet does not commit the city to purchase the casino, it does not commit to a location and it does not allow bonds to bought or property taxes to be raised.

Before aldermen voted to pursue buying Rhythm City, several people spoke out about their thoughts on a city owned casino.

"I do not think it is a good decision for the city to get into the gaming business."

"It's basically immoral. The only reason a casino gambling operation is able to make money is because they know how to take advantage of human weakness."

"I stand in favor of this transaction. I think personally it's one of the best and smartest ventures the city can enter into in a long time."

The city administrator gave a presentation about how bonds will pay for the $46-million dollar price tag and that the bonds will be paid back from revenue from the casino. Davenport leaders are using a city owned casino in Dubuque, which is profitable, as an example. Most of the aldermen say they are pursuing purchasing Rhythm City, because it's so early in the process and they want to continue to explore the option. However, not everyone on council agrees.

"My ward meeting had the most constituents I've had at one meeting in 4 or 5 years. An overwhelming majority asked me not to do this. I represent them and that's a big thing I need to consider," says Alderman Mike Matson.

"I'm of the opinion that the status quo is unacceptable. I think we can manage our debt and I think we can pay the bonds back quicker than the 20-year time frame," adds Alderman Jeff Justin.

Thursday afternoon the city will give the RDA a presentation. Next week, the request for proposals from private developers will go out and negotiations will begin with the Isle of Capri. In November, work will begin on creating the non-profit that will run the casino, the city will under go a background check, and DCI review, and meet with the IRGC. In December, a developer will be selected. Tentatively in March and April, the IRGC will approve the sale, the bonds will be bought, the riverboat will be re-branded, and ground will be broken on a land based casino.