Davenport official: Property taxes will not pay for casino pursuit


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Originally Posted Online: April 17, 2013, 11:07 pm
Last Updated: April 17, 2013, 11:08 pm
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By Stephen Elliott, selliott@qconline.com

Property tax dollars were not spent ona $387,500 bill related to Davenport's pursuit of a city-owned, land-based casino, city administrator Craig Malin said Wednesday night.

Davenport resident David Haase raised the question during Wednesday's committee-of-the-whole meeting, asking where the money came from. Aldermen last week, on a 6-to-2 vote, tabled paying the accounting firm of Deloitte and Touche LLP for three months of work related to the city's attempted purchase of the Rhythm City Casino from Isle of Capri.

Mr. Malin said money for the bill — included in the roughly $600,000 the city has acknowledged spending on the casino effort — came from other sources.Mr. Malin said the city receives between $1.6 million and $1.8 million annually in casino revenue. Ald. Jeff Justin, 6th Ward, who also chairs the finance committee, said local option sales tax dollars also will be used to pay for the city's work on a casino purchase.

"That revenue (casino revenue) will be able to be dedicated toward due diligence," Mr. Malin said. "That's in the worst case that the city pays for the due diligence and has no one else to pay for it."

Mr. Malin said the Riverboat Development Authority, the nonprofit group holding the casino license, and any potential groups interested in buying the casino, will be able to use the city's due diligence information.

"That's not going to come for free," he said. "We expect to be repaid for it.

"The due diligence bill, specifically, was directed at trying to make sure we (the city) didn't overpay for an asset (Rhythm City Casino)," Mr. Malin said.

Judith Lee, of Davenport, criticized the city for a lack of accountability on its due diligence.

Last week city attorney Tom Warner said Davenport used its casino consultant, Gary Buettner, and the Des Moines law firm of Ahlers and Cooney to oversee the accounting firm's work in determining the $387,500 bill to the city.

"I've been involved in government contracting," Ms. Lee told the council."In the accounting business, that's what we call riding the horse whereeverybody says, 'Oh, we've got some hours left; we don't know who to charge. Let's charge it to these people (city) who weren't really watching.'

"And that's what I'm seeing is going on with this."

Walter Skovronski, of Davenport, complimented the city for at least getting a new casino idea off center. He criticized the RDA, which sent a letter to the city on Monday stating it did not want to meet with city officials at this time to discuss casino options.

On March 4, the RDA publicly stated its desire to seek alternatives to a city-owned and financed casino.Aldermen on Wednesday also discussed a motion directing Mr. Malin to request a joint, open public meeting between the RDA and the city council in the next 30 days.

"You've gone as far as you can go," Mr. Skovronski said. "Now is the time to sit back, smoke a cigar, drink a beer and let this take its course.

"If these people (RDA) are so smart, let them do some work."


















 



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