The Iowa Racing and Gaming Commission (IRGC) met on Thursday, October 21, 2021 at Casino Queen Marquette in Marquette, Iowa. Commission members present were Julie Andres, Chair; Daryl Olsen, Vice Chair; and members Mark Campbell and Lance Horbach.
APPROVE AGENDA: Chair Andres called the meeting to order at 8:30 AM and requested a motion to approve the agenda. Commissioner Campbell so moved. Commissioner Olsen seconded the motion, which carried unanimously.
WELCOME: Don Ostert, General Manager, welcomed everyone to northeast Iowa and highlighted some of the attractions in the area. He noted the facility opened in 1994 under the name of Miss Marquette. They currently have 107 employees; 13 have been with the property since opening day and 41 have been employed for 15 or more years. Mr. Ostert advised the property is in the process of changing out the slot system, installing new slot machines, token machines and marketing kiosks, representing an investment of $2.5 million. He stated fubo Gaming recently started operating their online and retail sports betting facility.
Steve Weipert, Mayor and an Upper Mississippi Gaming Corporation board member, stated there are negative and positive sides to having a casino in the community. The negative is that other communities wish they had their own casino, but he reminds them they do benefit from the casino. The non-profit operator has distributed over $2 million to 150 non-profits in the area. He also feels there has been a slight decline in community unity. Prior to the casino, if there was a need in the community, the citizens would band together to raise the necessary funds; now it is let the casino pay for it. Due to the funds received from the casino, the City of Marquette has been able to complete upgrades to the sewers, water and sanitary systems, add an addition on to the museum, build a new parking lot with electric charging stations, and more. The city worked with Cobblestone to build the new hotel, with space for a new City Hall and community meeting room. They have also installed solar panels on city buildings, which saves the citizens $3,000 per month in utility bills.
Commissioner Horbach thanked Mr. Weipert for his comments regarding the infrastructure. He stated he came because of the casino and meeting, but was leaving with a Marquette experience.
APPROVE MINUTES: Chair Andres moved to the approval of the minutes from the August 26, 2021 Commission meeting. Commissioner Olsen moved to approve the minutes as submitted. Commissioner Horbach seconded the motion, which carried unanimously.
ANNOUNCEMENTS: Brian Ohorilko, Administrator, stated the next meeting would be November 18th at the Diamond Jo in Dubuque. There will be no meeting in December. The first meeting of 2022 will be held on January 13th at Prairie Meadows Racetrack & Casino in Altoona.
Mr. Ohorilko stated Gaming Representative Cory Kozelka was not able to attend the meeting as his presence was needed on the gaming floor.
RULES: Mr. Ohorilko advised there are 26 items being presented under Notice of Intended Action. This is the first step in the process. The rules being presented are the result of staff and industry meetings, legislative changes in the last session, and racing task force meetings. The rules were sent to the industry and staff did receive some comments regarding a few sports wagering items. Staff has worked with the industry to resolve the issues.
Hearing no comments or questions, Chair Andres requested a motion. Commissioner Horbach moved to approve the rules as submitted under Notice of Intended Action. Commissioner Campbell seconded the motion, which carried unanimously.
ADVANCE DEPOSIT SPORTS WAGERING OPERATOR AGREEMENT: Thomas Roberts, General Manager for Harrah’s and Horseshoe Casino, presented an Online Market Access Agreement between Isle of Capri Bettendorf, L.C. (IOCB) and Tipico Iowa, LLC. He stated the company was founded in 2004 in Europe, and currently operates in Colorado and New Jersey.
Commissioner Horbach asked how IOCB was able to get a company from Europe to come to Iowa. Mr. Roberts stated they worked with the corporate office, which looks for reputable companies operating in the United States. He indicated the second skin under consideration at this meeting is a market share leader in Germany, which had sports wagering before the United States.
Hearing no further comments or questions, Chair Andres requested a motion. Commissioner Olsen moved to approve the Advance Deposit Sports Wagering Operator Agreement between Isle of Capri Bettendorf, L.C. and Tipico Iowa, LLC. Commissioner Campbell seconded the motion, which carried unanimously.
CONTRACT APPROVALS (OSV – OUT OF STATE VENDOR; RP – RELATED PARTY):
Isle of Capri Bettendorf, L.C.: Mr. Roberts presented a contract with Northwest Mechanical for HVAC Maintenance and Supplies.
Hearing no comments or questions, Chair Andres requested a motion. Commissioner Olsen moved to approve the contract as submitted by IOCB. Commissioner Campbell seconded the motion, which carried unanimously.
IOC Black Hawk County, Inc.: Chad Moine, General Manager, presented the following contracts for Commission approval:
- CentiMark Corporation – Roof Replacement
- Compass Group – Employee Dining Food Vendor
- Lithographic Communication – Marketing Direct Mail Service (OSV)
Hearing no comments or questions, Chair Andres requested a motion. Commissioner Horbach moved to approve the contracts as submitted by IOC Black Hawk County, Inc. Commissioner Campbell seconded the motion, which carried unanimously.
Riverside Casino and Golf Resort, LLC: Damon John, Director of Marketing, presented the following contracts for Commission approval:
- Atlantic Bottling Company – Beverage Agreement
- Builders Sales & Services Company – Event Center Remodel – Chandelier Support (OSV)
- Global Payments Gaming Services, Inc. – Cash Advance Credit/Debit Card Processing (OSV)
- Global Payments Gaming Services, Inc. – Check Guarantee Agreement (OSV)
- Mid-State Poker Tour, LLC – MSPT Events (OSV)
Commissioner Olsen noted that four of the contracts were with out-of-state vendors. Mr. John advised the contract with Builder Sales & Services was with a previously approved vendor; the chandelier selected for the event center required extra support due to its weight, Mid-State Poker Tour is located in Minnesota, does not have an Iowa location nor is there a similar vendor in Iowa.
Hearing no further comments or questions, Chair Andres requested a motion. Commissioner Olsen moved to approve the contracts as submitted by Riverside Casino and Golf Resort, LLC. Commissioner Horbach seconded the motion, which carried unanimously.
Rhythm City Casino, LLC: Mr. John presented the following contracts for Commission approval on behalf of Rhythm City Casino:
- Atlantic Bottling Company Coca Cola – Coca Cola Beverage Agreement
- Global Payments Gaming Services, Inc. – Cash Advance Credit/Debit Card Processing Revenue Agreement (OSV)
- Global Payments Gaming Services, Inc. – Check Guarantee Agreement (OSV)
- Imagine This – Continuity and Promotion Agreements (OSV)
Hearing no comments or questions, Chair Andres requested a motion. Commissioner Campbell moved to approve the contracts as submitted by Rhythm City Casino, LLC. Commissioner Horbach seconded the motion, which carried unanimously.
Grand Falls Casino, LLC: Mr. John presented the following contracts on behalf of Grand Falls Casino:
- A-1 Concrete Grinding & Mudjacking – Sun Shade Project: Concrete & Fittings (OSV)
- Chesterman Bottling – Beverage Agreement
- Global Payments Gaming Services, Inc. – Cash Advance Credit/Debit Card Processing Revenue Agreement (OSV)
- Global Payments Gaming Services, Inc. – Check Guarantee Agreement (OSV)
Hearing no comments or questions, Chair Andres requested a motion. Commissioner Horbach moved to approve the contracts as submitted by Grand Falls Casino, LLC. Commissioner Olsen seconded the motion, which carried unanimously.
Harveys Iowa Management Company, LLC: Mr. Roberts presented the following contracts for Commission approval:
- Aria Group Architects, Inc. + Design – Design Fees for Property Improvements (OSV)
- Century Asphalt – Construction Vendor
- Mulhall’s – Landscaping Vendor (OSV)
- Omaha Neon – Sign Vendor
- EMC – General Contractor (OSV)
Hearing no comments or questions, Chair Andres requested a motion. Commissioner Horbach moved to approve the contracts as submitted by Harveys Iowa Management Company, LLC. Commissioner Campbell seconded the motion, which carried unanimously.
SCE Partners, LLC: Doug Fisher, General Manager, presented a contract with Mark-It-Smart (OSV) for promotional items.
Hearing no comments or questions, Chair Andres requested a motion. Commissioner Olsen moved to approve the contract as submitted. Commissioner Campbell seconded the motion, which carried unanimously.
IOWA WEST RACING ASSOCIATION d/b/a HORSESHOE CASINO-BLUFFS RUN GREYHOUND PARK: Mr. Roberts and Brenda Mainwaring, President of Iowa West Racing Association (IWRA) were present to address the agenda items.
Application for a Pari-Mutuel License, Racetrack Enclosure Gambling License, and Sports Wagering License for January 1, 2022 through December 31, 2022: Ms. Mainwaring requested renewal of the license for 2022 and stated that Horseshoe Casino is an important partner with the City of Council Bluffs. They have provided more than $1 million in tax revenue, and bring tourism dollars to the community as 75% of their guests are from out-of-state. The facility has 600 employees; 50% are Iowa residents.
Mr. Roberts stated IWRA’s involvement in projects with the city improves the quality of life for local residents and visitors to the community and brings in tourism dollars. He advised the management team has served in 98 community events, wages have been increased in excess of $500,000, and the property has paid $1.1 million in property taxes. They will be renovating the Hilton Hotel at a cost of approximately $8 million, and hope to have it completed by the end of September 2022. As they are currently working on another hotel project, this particular project will not commence until May 2022. Delays are due to Hilton and supply chain issues.
Hearing no comments or questions, Chair Andres requested a motion. Commissioner Campbell moved to approve Iowa West Racing Association’s Application for Pari-Mutuel License, Racetrack Enclosure License and Sports Wagering License for January 1, 2022 through December 31, 2022 with the following conditions:
- Staff be provided with an accurate and updated list of all signals being taken by the simulcast venue on an ongoing basis; and
- Import contracts are available on demand to staff to ensure regulatory compliance.
Commissioner Olsen seconded the motion, which carried unanimously.
Contract: Mr. Roberts submitted a contract with Century Asphalt as a construction vendor for Commission approval.
Hearing no comments or questions, Chair Andres requested a motion. Commissioner Olsen moved to approve the contract as submitted by IWRA d/b/a Horseshoe Casino-Bluffs Run Greyhound Park. Commissioner Campbell seconded the motion, which carried unanimously.
IOWA GREYHOUND ASSOCIATION d/b/a The Iowa Greyhound Park:
Application for Pari-Mutuel License. Granting of Race Dates for April 16, 2022 through May 15, 2022. Brian Carpenter, Director of Racing, advised next year would be a very short season, as well as the last season of greyhound racing in Dubuque. The race meet next year will consist of 18 racing dates with 10 races per card.
He also believes there will be a shortage of greyhounds as a number of breeders have ceased operations as greyhound tracks have closed the past two years. This year Dubuque was one of four greyhound tracks that held races; there will be two left after Dubuque ceases operations next year. He feels greyhound racing will be gone in the United States in five years.
Mr. Carpenter stated the dogs from the south were able to come to Dubuque in March of this year, enabling them to add two weeks to this year’s racing season. Handle to date this year is $20 million; and the highest stakes race in the history of racing at Dubuque with a purse of $412,242.38 was run on October 24th.
Hearing no comments or questions, Chair Andres requested a motion. Commissioner Horbach moved to approve the Iowa Greyhound Association’s Application for Pari-Mutuel License for January 1, 2022 through December 31, 2022 and grant race dates as submitted in the application in conjunction with the ratification of the Lease Agreement between the City of Dubuque and the Iowa Greyhound Association with the following conditions:
- Export contracts have review and approval by staff to ensure regulatory compliance;
- Import contracts are available on demand to staff to ensure regulatory compliance; and
- Racing purses must be held until test samples are cleared by the state chemist.
Commissioner Campbell seconded the motion, which carried unanimously.
Contracts: Mr. Carpenter presented the following contracts for Commission approval:
- Second Amendment to Sublease Agreement between the City of Dubuque and Iowa Greyhound Association
- Second Amendment to Sublease Agreement between Dubuque Racing Association, Ltd. as Sublessor, Iowa Greyhound Association, as Sublessee
Hearing no comments or questions, Chair Andres requested a motion. Commissioner Olsen moved to approve the contracts as submitted. Commissioner Horbach seconded the motion, which carried unanimously.
PRAIRIE MEADOWS RACETRACK AND CASINO, INC. d/b/a PRAIRIE MEADOWS RACETRACK AND CASINO (PMRC): Gary Palmer and Derron Heldt, General Manager and Director of Racing respectively, were present to address the agenda items.
Commissioner Olsen stated that with greyhound racing coming to an end, he is concerned about the health of horse racing in Iowa. He asked Mr. Ohorilko if the Commission itself, or if PMRC or the Iowa Horsemen’s Benevolent Protection Association (IHBPA), have been asked to look at the health of the industry. He questioned if there is something the Commission should be proactively doing versus doing nothing.
Mr. Palmer stated it is clear where the future is, and the industry has time to do something about it. He stated PMRC wants to continue horse racing but some changes are going to have to be made nationwide. With handle declining, Mr. Palmer feels there is going to have to be an alternative; he believes the race days are going to have to change. He feels the industry is going the wrong way, which is concerning for PMRC, the horsemen and the Commission. Mr. Palmer stated there is concern as to what steps to take for the future, and what the future should look like if the industry is going to survive in Iowa.
Commissioner Olsen asked Mr. Ohorilko if there are steps the Commission could take to initiate a study or something to be proactive in this area. Mr. Ohorilko stated the Commission has the authority to request a strategic plan for horse racing or the health of the industry. He noted there have been instances when PMRC or the IHBPA have conducted studies. He stated that instead of a study, it could be a general assessment of the industry. Mr. Ohorilko stated the last time a study was done was approximately eight or nine years ago, but he was not sure if it addressed a long term plan for the industry. He felt it was focused on the industry at that time; however, there have been significant changes to the industry since then. Mr. Ohorilko stated the timing would be appropriate if it is something the Commission would like to entertain.
Mr. Palmer stated PMRC asked Mr. Ohorilko several years ago to sit in on the negotiations with the horsemen so everyone heard the same thing at the same time; minutes are kept as well. He noted most of the studies PMRC has requested in the past have been economic impact studies for the state of Iowa. Those studies tend to leave out inventory and what other tracks across America are doing to survive or minimize expenses versus maximizing their expenses. Mr. Palmer stated PMRC believes there is a solution that can be found before it comes down to having racing or not having racing.
Commissioner Horbach stated he is not a big advocate of studies or of having someone else do so. He suggested PMRC continue the same format with the meetings with the horsemen but allow some of the Commissioners to sit in. This would provide an opportunity for PMRC and the horsemen to inform the Commission as to what they see as the challenges facing the industry, and allow the Commission as a representative of the State to voice their wants, needs and what they see as challenges facing the industry. If a study is appropriate after those discussions, it could be limited to those items that are the top priorities of the parties.
Mr. Palmer concurred with Commissioner Horbach’s comments.
Mr. Ohorilko stated the timing would typically be when PMRC is negotiating an additional three-to-five year contract with the horsemen; the current contract has one more year. He suggested a stakeholder meeting with the horse racing industry similar to what they did with the casino industry.
Commissioner Olsen noted the January 2022 meeting is at PMRC. He asked the staff to look at the options available, and be proactive. He would like to get some answers before it is too late to save the horse racing industry.
Application for Pari-Mutuel License and Granting of Race Dates; Racetrack Enclosure Gambling License and Sports Wagering License for January 1, 2022 through December 31, 2022: Chair Andres asked Mr. Heldt to discuss the race dates before the Commission.
Mr. Heldt stated there had been a modification to the race date calendar submitted with the license renewal application. The original calendar indicated there would be racing on Thursday, July 14th, but they normally run Friday, Saturday, Sunday and Monday. The horsemen felt five days of racing was too much in July. The calendar was modified to move that race day to Sunday, October 2nd; therefore, the race meet will end on October 2nd instead of October 1st.
Mr. Palmer stated PMRC will be commencing a hotel renovation in 2022 costing approximately $12.5 million. They will be asking the Board to approve capital expenditures of approximately $10 million next week.
Hearing no further comments or questions, Chair Andres requested a motion. Commissioner Olsen moved to approve Prairie Meadows Racetrack & Casino’s Application for Pari-Mutuel License, Racetrack Enclosure Gambling License, and Sports Wagering License for January 1, 2022 through December 31, 2022, grant race dates as submitted in the application with the exception of moving race day July 14 to October 2, and approve the revised security plan included in the application with the following conditions:
- Export contracts have review and approval by staff to ensure regulatory compliance;
- Import contracts are available on demand to staff to ensure regulatory compliance;
- Marketing promotions that may affect the live racing schedule and post times shall have prior approval from Commission staff.
Commissioner Horbach seconded the motion, which carried unanimously.
Recap of Race Meet: Mr. Heldt advised there were mixed results for both the on and off-track handle and field sizes. Thoroughbred handle was up over $780,000 on track and off-track was up about $5.8 million year over year. Quarter horse handle was up on track about $67,000, but off-track handle was down about $729,000. Mr. Heldt stated the main factor leading to the increased handle was the increase in the number of racing days, 67 in 2020 versus 84 this year. He stated there were two days with mandatory payout on the Jackpot Pick 5, which totaled $4.7 million for the season and also helped increase the handle.
Mr. Heldt advised the field size for the thoroughbreds was down from 6.79 in 2020 to 6.4 this year; quarter horses were down from 7.3 last year to an average of 7 horses this year. He stated there are a number of variables that affect field size – the number of horses trainers bring, the number of races, categories, and distances to name a few. He indicated he and his staff would be evaluating those in the off season to determine how to improve the field size. He stated the betting public nor PMRC like short field sizes.
Mr. Heldt stated there were some great races this season as well. Racing concluded on Saturday, September 25th with an All Iowa-bred day consisting of 12 races - 8 thoroughbred and 4 quarter horse. Alex Wessel, an Iowa trainer, won three of the four races. Mr. Heldt stated the family has been involved in racing for many years. On the thoroughbred side, the leading trainer, Lynn Chleborad, won two of the races. Kelly Von Hemel, PRMC’s Hall of Fame Trainer, won three races. A thoroughbred jockey won four races. Mr. Heldt stated there were great performances on both sides.
The Festival of Racing was held in early July. A horse by the name of Knicks Go, one of the top horses in the county, came and raced. Since that time, he has won two $500,000 races and one $1 million race. He will be participating in the Breeders’ Cup races on November 5th and 6th; this race is the championship of all horse races across the country. The race includes the Classic Race, which has a $6 million purse.
Mr. Heldt stated the Iowa Thoroughbred Breeders and Owners Association (ITBOA) had their annual sale in September. The top purchase price this year was $34,000, but has been as high as $60,000 in prior years. The strength of the market in Iowa is in the mid-market range, or horses that sell in the $10,000 - $40,000 range. He advised that other sales across the country have also seen strength in the mid-market range, so what occurred here is representative of what is happening across the country.
Mr. Heldt stated PMRC takes the condition of the racing surface very seriously. He noted Dr. Sweeney, the state veterinarian, provides a report showing all injuries, including catastrophic, that occur on the backside or racetrack. Mr. Heldt reported there were three catastrophic injuries during the 84 racing days that occurred on the racing surface; two thoroughbreds and one quarter horse. The national measurement for catastrophic injuries is per 1,000 starts; PMRC’s ratio is .58 per 1,000 starts. The national average is 1.41 per 1,000 starts. Mr. Heldt stated PMRC did a couple of things differently this year. If a storm was forecast to move in prior to the start of training at 6:00 AM, the main track was shut down. He stated the state veterinarians also took a harder look during the pre-race exams.
Commissioner Horbach asked about the make-up of Iowa horses versus out-of-state horses in the races. He also asked if the field sizes were due to Iowa breeders not choosing PMRC and Iowa, or something that is occurring nationwide.
Mr. Heldt advised that foal crops have been declining across the country, and Iowa is no different. The number of thoroughbred foals declined from 240 to 167 this year.
Commissioner Horbach asked about race inventory generically; are the races heavy on out-of-state horses. Mr. Heldt stated during the recent mixed meet, there were 940 thoroughbred horses, which left 420 stalls for quarter horses. In June, 90% of the 940 thoroughbreds were on the backside; however the percentage dropped to 80% in July and by August the percentage was down to 50%. Mr. Heldt stated 28-35% were Iowa-bred horses.
Contracts: Mr. Palmer presented the following contracts for Commission approval:
- Canteen (Compass Group USA) – Face Masks packed for Vending Machine
- Global Payments – Credit and Debit Card Services – Revenue Agreement (OSV)
- Global Payments – Casino Guest Check Cashing/Kiosk Purchase & Maintenance (OSV)
Hearing no comments or questions, Chair Andres requested a motion. Commissioner Campbell moved to approve the contracts as submitted by PMRC. Commissioner Olsen seconded the motion, which carried unanimously.
Chair Andres reiterated the importance of utilizing Iowa vendors, noting the Commission usually receives good explanations when the facilities are unable to do so. She noted there were a couple instances this month where the Commission would have liked to see a better explanation. She stated the Commission would continue to monitor the use of out-of-state vendors. She noted the absence of some individuals who were not available to address the use of out-of-state vendors.
Catfish Bend Casino II, L.L.C. (CBC): Mr. Ohorilko advised Commission staff and CBC have entered into a Stipulated Agreement for a violation of Iowa Code 99F.9(5), related to underage gambling. This incident occurred on December 18, 2020. A 15-year old entered the gaming floor unchallenged, and was on the floor 47 minutes. Due to the lack of clarity in the surveillance coverage, it was not discernible if the individual gambled; however, Commission staff was able to verify the individual did pull a ticket out of a machine. Based on the preponderance of evidence, Commission staff believes the individual did gamble. The individual left the gaming floor and attempted to re-enter; at that point the minor asked the security officer on duty to page his friends. The security officer verified the age of the individual and contacted the Burlington Police Department. Mr. Ohorilko stated CBC has agreed to an administrative penalty up to $30,000 due to potential aggravating circumstances, the age of the minor and the lack of surveillance coverage.
Rob Higgins, General Manager, stated the facility takes underage gambling very seriously. He stated the two gentlemen the individual was with had been there earlier in the evening and he just followed them onto the floor. The individual had a hoodie covering his head and had a mask on so only the eyes were visible. Upon reviewing surveillance footage, the security officer was distracted. Immediately following this incident, staff was retrained, and the surveillance system was upgraded.
Commissioner Horbach noted before a violation makes it to the Commission, it has to meet three criteria: enter the floor unchallenged, be on the floor over 30 minutes and gamble, or consume alcohol. He noted some of the criteria is out of the facility’s control, but they do have control over whether the individual enters the floor unchallenged. He stated he stops at the licensed facilities when traveling for his job. At one recent stop, he was able to walk onto the casino floor without being seen by anyone, so he walked out and walked back in – again without being acknowledged by any security personnel. He walked back out and stood a short distance from the security podium for a few minutes before being acknowledged by the security officer on duty. He stated he has the highest respect for the security officers who stand at the entrances for the length of time required. He stated the operators do not have to reach this point if they execute the policies and procedures for entering the gaming floor; how that is accomplished is up to them. Commissioner Horbach stated they don’t like seeing these Stipulated Agreements, and feels he has seen too many in his short tenure on the Commission due to management failures and events that are within the control of the facility.
Mr. Higgins stated that Commissioner Horbach’s comments were correct. He advised the majority of the facilities have the same policies and procedures in place. He stated CBC purchased a face recognition system, and individuals are required to lower their mask to aid in proper identification. Mr. Higgins stated he has a good relationship with the DCI and Burlington Police, and when these incidents occur, the facility does press charges against the individual.
Hearing no further comments or questions, Chair Andres requested a motion. Commissioner Campbell moved to approve the Stipulated Agreement with an administrative penalty of $30,000. Commissioner Olsen seconded the motion, which carried unanimously.
Diamond Jo Worth, LLC (DJW): Mr. Ohorilko stated Commission staff and DJW have entered into a Stipulated Agreement for a violation of Iowa Code 99F.9(5), related to underage gambling. He advised an underage female entered the gaming floor on February 10th, was on the floor for two hours and twenty minutes, and gambled on three machines. He stated a security officer did approach the individual while she was on the floor to request identification, which is how the individual was identified as a minor and should not be on the floor. Mr. Ohorilko stated DJW acknowledges the facts and has agreed to an administrative penalty of $20,000.
Scott Smith, General Manager, stated this is an unfortunate incident and is taken seriously by the facility. He indicated the facility did have the proper policies and procedures in place; the guard at the podium did ask the three guests that passed through the turnstile to lower their masks, but chose not to actually request identification. The policy states the guest is asked to lower their mask, the guard is to engage with the guest and request identification, especially if the guest appears to be under 35 years old. He noted the policies and procedures were followed on the gaming floor when the individual was identified. Mr. Smith stated staff is trained to never assume that just because an individual made it through the turnstile they are twenty-one. These types of incidents are used to reinforce the policies and procedures, and make adjustments when necessary. He pointed out the legal gambling age in Minnesota is 18; it is not unusual for the guards to turn away 25-30 individuals on the weekend.
Hearing no further comments or questions, Chair Andres requested a motion. Commissioner Horbach moved to approve the Stipulated Agreement with an administrative penalty of $20,000. Commissioner Campbell seconded the motion, which carried unanimously.
Iowa West Racing Association (IWRA) d/b/a Horseshoe Casino Council Bluffs: Mr. Ohorilko stated Commission staff and IWRA operating Horseshoe Casino have entered into a Stipulated Agreement for a two-count violation of Iowa Code 99F.9(5), related to underage gambling. He stated the first count occurred on January 14th when a 16-year old female entered with an adult male companion. The individual entered the gaming floor unchallenged, was on the gaming floor for an hour and fifteen minutes, gambled and walked around the gaming floor for a period of time. A Horseshoe security officer was notified by a relative that they knew this individual and believed the individual was on the gaming floor. The individual was later identified due to another call that was made the next day at which time it was determined the individual was underage and they left the property.
The second count occurred on April 7th, and involved a 17-year old female who entered with an adult companion unchallenged, was on the floor five hours, and did walk throughout the gaming floor. The individual was identified when she went to Security Dispatch to claim a lost wallet. At that time, identification was requested and it was determined she was underage.
Mr. Ohorilko stated that as a result of both counts, IWRA d/b/a Horseshoe Casino has agreed to an administrative penalty up to $60,000, which will need to be set by the Commission. He advised the fines were elevated due to the potential aggravated circumstances, the age of the minors and the conduct of the minors while on the gaming floor.
Mr. Roberts stated Horseshoe did not dispute the facts set forth in the Stipulated Agreement. He stated two employees failed to perform their job duties; one minor getting past security is bad, but two in such a short period of time is negligence. Mr. Roberts advised that in addressing these two violations, the two guests that brought the minors in have been barred from all Caesars’ properties; one security officer was terminated, and the other has received a final written warning. Mr. Roberts advised the staring wage for security personnel has been increased to help draw better qualified individuals. The policies and procedures for entry onto the gaming floor have been updated; all guests are required to lower their mask, and a Veridocs system was added. They have caught minors attempting to use someone else’s ID to beat the system. For those individuals born between 1990 and 2000, security officers are requesting a second form of identification. A security station was added to the north entrance, and they have increased staff to help with identification procedures during the weekends when they are busier. Mr. Roberts advised no additional minors have made it past the turnstiles since these incidents. He also stated that from January 1st of this year, Horseshoe has had 1.3 million guests, and have verified 47,000 IDs, and have turned away over 5,000 individuals with minors. He stated they have good processes in place and have added staff to keep the front door secure, but did acknowledge errors were made.
Hearing no further comments or questions, Chair Andres requested a motion. Commissioner Olsen moved to approve the Stipulated Agreement with an administrative penalty of $60,000. Commissioner Horbach seconded the motion, which carried unanimously.
Prairie Meadows Racetrack & Casino, Inc. (PMRC): Mr. Ohorilko stated Commission staff and PMRC have entered into a Stipulated Agreement for a violation of Iowa Code 99F.9(5), related to underage gambling. On July 6, 2021, an underage male approached the turnstile; the security officer failed to request identification. The minor entered the gaming floor unchallenged, was on the floor 64 minutes and did gamble. A security officer walking the floor recognized the individual as someone they had turned away on a previous occasion. They stopped the individual, requested identification and removed them from the gaming floor. As a result of the violation, Mr. Ohorilko stated PMRC has agreed to pay an administrative penalty of $20,000.
Clint Pursley, Vice President of Security, stated he is not aware of any other industry in the State of Iowa, or on a national level, that puts as much effort into the prevention of underage activity as the casino industry. He stated they have a tremendous amount of infrastructure in place to aid the security officers at the door. In this case, the individual was not just someone who had been on property previously, but had been there the day before. The security officer that found him on the floor turned this individual and his group away as he recognized them from the day before. Mr. Pursley noted that while PMRC is not located near the border of a state that allows gambling at 18, there are states that allow pari-mutuel wagering at 18. He stated they ID over 150,000 people per year, or between 5.5 and 7% of the individuals that come through the door. He feels the facility has sent a message to the community regarding underage gambling, but noted it may not be heard very loudly by some individuals. Mr. Pursley noted three individuals entered at the same time in this instance. The security officer requested identification from two, but not the third. When asked why she didn’t request identification from the third individual, she didn’t have an answer.
Commissioner Olsen expressed appreciation for all of the comments from the facilities; however, the Commission is tasked with upholding the integrity of the gaming industry. They don’t have any choice but to levy a fine.
Commissioner Campbell concurred with Commissioner Olsen’s comments. He feels the Commission needs to start a conversation with the Division of Criminal Investigation that they enforce the law on the other side as some individuals look at this as a game in which they don’t have anything to lose. The facility is the one being fined, and the minor is just escorted off the property. He stated he is not aware of any fines being issued to the minors or adults bringing the minors onto the floor. Commissioner Campbell expressed his appreciation for Caesars banning the adults in that situation; however, until those attempting to get on the floor have something to lose, they will persist. He stated the fake IDs are getting better all the time.
Commissioner Campbell moved to approve the Stipulated Agreement with an administrative penalty of $20,000. Commissioner Olsen seconded the motion, which carried unanimously.
IOWA GAMING ASSOCIATION: Wes Ehrecke, President, presented a Petition for Waiver requesting a waiver on the licensing of non-gaming positions to allow a new or prospective employee be provided an interim badge for up to 60 days rather than “the next day of business” as stated in 491 IAC 6.2(6)“a”. He requested the waiver remain in place for one year, beginning on the date of implementation.
Commissioner Horbach thanked all the members of the Iowa Gaming Association for participating in the industry meetings earlier this year. During those meetings, the Commission identified a common issue that was fixable; licensing was a restriction on hiring staff in competitive situations. He provided a brief history of how gaming came to Iowa, and one of the issues was that everyone involved in gaming had to be licensed. Commissioner Horbach stated the Commission respects the IGA members and that they are disadvantaged by this particular rule and, while it is the Commission’s responsibility to uphold the integrity of the industry, they feel this is an area where the parties can come together to come closer to putting the facilities on the same level as other industries in today’s competitive staffing market. Commissioner Horbach expressed his support, and thanked the industry for educating the Commission on this matter. He expressed his hope that the industry would use the waiver productively and correctly.
Hearing no further comments or questions, Chair Andres requested a motion. Commissioner Olsen moved to grant a waiver of the duration for holding an interim badge as required in 491 IAC 6.2(6)“a” for non-gaming positions for up to 60 days. The waiver shall be in effect for one year. The Commission hereby directs legal counsel to draft an order consistent with this motion for the Chair’s signature. Commissioner Campbell seconded the motion, which carried unanimously.
PUBLIC COMMENT/ADMINISTRATIVE BUSINESS: As there was no Public Comment, Chair Andres called on Mr. Ohorilko for Administrative Business. He advised the reversion for Fiscal Year 21 is $153,336.09. He noted House File 867 allows the reversion to be used for the cost of the socioeconomic impact study. Mr. Ohorilko noted the cost of the study is actually higher than that so there will be no reversion to the facilities this year; however, he felt it was important to advise the industry of the reversion amount.
ADJOURN: Hearing no further business to come before the Commission, Chair Andres requested a motion to adjourn. Commissioner Olsen so moved. Commissioner Horbach seconded the motion, which carried unanimously.