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IRGC Meeting - Altoona

Meeting Time: Tuesday, February 4, 2020
Meeting Location

Prairie Meadows Racetrack and Casino
One Prairie Meadows Drive
Altoona , IA 50009

Meeting Agenda Document:
Meeting Agenda

1.APPROVE AGENDA
2.EXECUTIVE SESSION – Pursuant to Iowa Code Sections 21.5(1)a, d, and g for the purpose of receiving backgrounds of entities related to the transaction by Eldorado Resorts, Inc.
RECESS UNTIL 8:30 AM, FEBRUARY 4, 2020
3. APPROVE MINUTES – From November 21, 2019 Commission Meeting
4. ANNOUNCEMENTS
A. March 10, 2020 – Prairie Meadows Racetrack & Casino, Altoona (Submissions are due by February 25, 2020)
B. April 16, 2020 – Ameristar Casino, Council Bluffs
C. May 2020 – No Meeting
5.RULES -Final Adopt (See Attached)
6.IOWA GAMING ASSOCIATION – Wes Ehrecke, President – County Endowment Program
7.ELDORADO RESORTS, INC.
A. Request for Approval of Acquisition of a Parent Company involving an Iowa Licensee
B. Request for Approval of Shelf Application for Debt Financing
8.CONTRACT APPROVALS (OSV – OUT OF STATE VENDOR; RP – RELATED PARTY)
A. Dubuque Racing Association, Ltd.
1.Communications Engineering Co. (CEC) – Update Audio/Video Display System
2.Guest Supply – In-Room Guest Supplies per Hilton Specs (OSV)
3.Lincoln Financial Group – Employee Life, AD&D and STD Insurance
4.Weber Paper Company – Janitorial and Paper Supplies
B. Diamond Jo, LLC
1.The Printer, Inc. – Direct Mail Printing
2.Adams Outdoor Advertising of Madison, WI – Billboard Advertising (OSV)
C. Diamond Jo Worth, LLC
1.AJB Enterprises – Snow Removal and Construction
2.CoreMark – Convenience Store and Food Service Distributor
3.King Food Service – Purchase Seafood and other Grocery Items
4.USA Security – Maintenance Contracts, Software, and Hardware Upgrades for Surveillance Equipment
5.Midwest Liquid Systems, Inc. – Maintenance of Gasoline Equipment and Operating System at Convenience Store, Jo Stop
D. Isle of Capri Bettendorf, L.C. – Eldorado Resorts, Inc. – Shared Service Agreement (OSV)
E. IOC Black Hawk County, Inc. d/b/a Isle Casino Hotel Waterloo – Shared Service Agreement (OSV)
F. Riverside Casino & Golf Resort, LLC – CDW – Software/Microsoft Office Standard License 2019 (OSV)
G. Rhythm City Casino, LLC – Video Security Specialists – Surveillance Equipment and Software (OSV)
H. Grand Falls Casino Resort, LLC
1.Advanced Deposit Sports Wagering Operator Agreement: Betfred Sports (Iowa) LLC -First Amendment to Sports Wagering Operating Agreement
2.Betfred Sports (Iowa) LLC – License Agreement
3.Contracts
a.Brockway Mechanical & Roofing Co. – Renovation Project: Mechanical, Plumbing & HVAC
b.Central Roofing Company – Renovation Project: Roofing and Roof Accessories (OSV)
c.Cummins Allison – Count Room Equipment Purchase and Maintenance Agreement
d.Lite Window & Door – Renovation Project: Aluminum Windows and Sliding Doors
e.Midwestern Mechanical, Inc. – Renovation Project: Design & Build Fire Suppression (OSV)
f.Murphy Company Insulation & Construction – Renovation Project: Insulation & Air Barrier (OSV)
g.Muth Electric – Renovation Project: Building Electric & Fire Alarm (OSV)
h.NBG Framing, LLC – Renovation Project: Wood Framing & Carpentry Labor (OSV
i.OneNeck IT Solutions, LLC – Technology Solutions: Hardware, Software, and Support Services
j.Peska Construction, Inc. – Renovation Project: Steel Erection (OSV)
k.Structural Component Systems, Inc. – Renovation Project: Wood Framing & Carpentry Materials
I. Ameristar Casino Council Bluffs. LLC
1.Bargreen Ellison – Purchase of Smallwares, China, Glass, F&B Equipment and Supplies (OSV)
2.Central Credit, LLC – Third Party Check Cashing Guarantor (OSV)
3.Core BTS, Inc. – Computer Technology; Network Switches (OSV)
4.Evotek – Computer Hardware and Software (OSV)
5.Konica Minolta – 5-Year Lease Agreement for Copiers
6.Marketing Refrigeration – Replacement of BERG (liquor control) System (OSV)
J. SCE Partners, LLC
1.Cunningham Group Architecture, Inc. – Design of the Parking Garage Retail Space (OSV)
2.Harmon Gaming Co. – Transfer of Truck (RP) (OSV)
3.Jim Franke – Transfer of Truck (RP)
K. Catfish Bend Casinos II, LLC
1.Micro Gaming Technologies -Kiosk Purchase and Software License (OSV)
2.Design Wise – Construction of Casino’s Sportsbook (OSV)
3.Video Security Specialists – Purchase Upgraded Surveillance System (OSV)
4.The Printer, Inc. – Marketing/Printing Services
L. Prairie Meadows Racetrack & Casino, Inc. d/b/a Prairie Meadows Racetrack & Casino
1.Aramark Uniform – Table Linen Services
2.Agilysys – Accounting/Inventory Control/Recipe Building Software and Support (OSV)
3.Bankers Trust Company – Banking Services and Credit Cards
4.DirecTV (Rockstar Satellite) – Television Programming in Casino and Hotel
5.EMC Risk Services, LLC – Workers’ Compensation Insurance
6.Graphic Controls – Slot Game Tickets (OSV)
7.Iowa Cubs/Greater Des Moines Baseball – Advertising and Sky Box Rental Agreements (RP)
8.Liberty Fruit Company – Fruits, Vegetables and Other Produce
9.ODS Technologies dba TVG Network – Televising Horse Races and Marketing Ventures (OSV)
10.Professional Solutions (NCMIC) – Merchant Processing Fees for Various Credit Cards
11.Rockstar Satellite (DirecTV) – Video Equipment Installation in Casino and Hotel
12.The Printer Inc. – Printing Services
13.Van Wall Equipment (Farmers Supply) – Track and Grounds Equipment, Parts and Service
14.William Hill Sports Book/American Wagering – Banking Support
9.IOWA GREYHOUND ASSOCIATION D/B/A IOWA GREYHOUND PARK
A. Approval of Amended License Renewal Application for Pari-Mutuel License and Granting of Race Dates for January 1, 2020 through December 31, 2020
B. Approval of Simulcast Wagering Agreement with Wild Rose Emmetsburg, L.L.C.
C. Approval of Simulcast Wagering Agreement with Wild Rose Jefferson, L.L.C.
10.HEARINGS
A. Isle of Capri Bettendorf, L.C. – For a violation of Iowa Code Section 99F.9(4) and (5)a (Minor)
B. HGI-Lakeside, LLC -For a violation of Iowa Code Section 99F.9(4) (Minor)
C. Prairie Meadows Racetrack and Casino, Inc. – For a violation of Iowa Administrative Code 491-10.4(5)“a” and “k” and 10.6(1) “b”(5) (Coggins Test and Entries)
D. Board of Stewards v Jose Amaya Rocha – Appeal of Proposed Administrative Law Judge Decision *Executive Session – The Commission may go into Executive Session pursuant to
Iowa Code Section 21.5(1)f for the purpose of discussing the decision to be rendered in a contested case conducted according to the provisions of chapter 17A.
11.PUBLIC COMMENT
12.ADMINISTRATIVE BUSINESS
13.ADJOURN

 

     

    Meeting Minutes Document:
    Meeting Minutes

    The Iowa Racing and Gaming Commission (IRGC) met at Prairie Meadows Racetrack & Casino, Inc. on February 3-4, 2020.  Commission members present were Kris Kramer, Chair; Carl Heinrich, Vice Chair; and members Julie Andres, Pennie Gonseth Cheers, and Jeff Lamberti.

    APPROVE AGENDA: Chair Kramer called the meeting to order at 5:30 PM, and requested a motion to approve the agenda.  Commissioner Gonseth Cheers moved to approve the agenda as submitted.  Commissioner Andres seconded the motion, which carried unanimously.

    EXECUTIVE SESSION: Commissioner Heinrich moved to go into Executive Session pursuant to Iowa Code Sections 21.5(1)a, d, and g for the purpose of receiving backgrounds of entities related to the transaction by Eldorado Resorts, Inc.  Commissioner Lamberti seconded the motion, which carried unanimously on a roll call vote.

    Following the conclusion of Executive Session, Commissioner Lamberti moved to return to open session.  Commissioner Andres seconded the motion, which carried unanimously.

    Chair Kramer recessed the meeting until 8:30 AM on Tuesday, February 4, 2020.

    Chair Kramer reconvened the meeting at 8:30 AM, and advised the agenda had been approved as submitted.

    APPROVE MINUTES: Chair Kramer requested a motion regarding the minutes from the November 21, 2019 Commission meeting.  Commissioner Gonseth Cheers moved to approve the minutes as submitted.  Commissioner Heinrich seconded the motion, which carried unanimously.

    ANNOUNCEMENTS: Chair Kramer called on Brian Ohorilko, Administrator of IRGC, for announcements.  Mr. Ohorilko provided the following information for future meetings:

    • March 10, 2020 – Prairie Meadows Racetrack & Casino, Altoona (Submissions are due by February 25, 2020)
    • April 16, 2020 – Ameristar Casino, Council Bluffs
    • May 2020 – No Meeting

    RULES: Mr. Ohorilko stated the rules before the Commission is the same package that was before them in November.  He advised that Commission staff has held a public meeting and appeared before the Legislative Rules Review Committee.  No concerns or comments were raised during those meetings.  Mr. Ohorilko stated a summary of the rules is contained in the November meeting minutes, which are in the meeting packets.  He requested approval of the Final Adoption of these rules.

    Hearing no comments or questions, Chair Kramer requested a motion.  Commissioner Andres moved to approve the Final Adoption of the rules.  Commissioner Gonseth Cheers seconded the motion, which carried unanimously.

    IOWA GAMING ASSOCIATION: Wes Ehrecke, President, noted the Iowa Legislature passed legislation ensuring all non-casino counties would receive gaming funds by creating the County Endowment Fund.  He presented the annual report for 2018 – 2019 setting forth grants from the county foundations as well as grants from the Qualified Sponsoring Organizations for the licensed casinos.  To date, the county foundations have distributed 28,581 grants totaling $107 million.  Last year each foundation received approximately $135,000; 25% goes into a permanent endowment.  The qualified sponsoring organizations for the licensed facilities distributed over 1,628 grants totaling approximately $95 million.

    ELDORADO RESORTS, INC.: Doug Gross, outside legal counsel, thanked the Commission staff and Commissioners for their time in reviewing this transaction, and stated the Division of Criminal Investigation was good to work with throughout the process.  Mr. Gross advised Eldorado Resorts was before the Commission to request the approval of a transaction involving two current Iowa licensees – Eldorado Resorts, Inc. and Caesars Entertainment.  The companies will merge and Eldorado Resorts will be the successor entity. They are also requesting approval of a Regional Lease as part of the transaction, and a Shelf Application for Debt Financing.

    Mr. Gross introduced the following corporate officers from Eldorado Resorts: Tom Reeg, Chief Executive Officer; Ed Quatmann, Chief Legal Officer; and Jeff Hendricks, Vice President – Regulatory and Compliance.

    Mr. Reeg stated Eldorado will acquire all outstanding shares of Caesars for $12.75 per common share, consisting of $8.40 in cash and 0.0899 shares of Eldorado common stock for each share of Caesars share of common stock.  Caesars Entertainment Corporation will merge with and into an Eldorado-owned subsidiary, allowing the existing operating companies to maintain their current licenses.  Eldorado shareholders will own approximately 51% of the outstanding pro forma shares.  Mr. Reeg advised committed financing is in place to fund the transaction. 

    Mr. Reeg stated the leadership team would be the existing Eldorado leadership team; he will be the CEO, Anthony Carano will serve as Chief Operating Officer; and Ed Quatmann will continue as the Chief Legal Officer.  The board will be split; six members will come from the Eldorado side and five from Caesars.  Following the closure of the transaction, Eldorado will change its name to Caesars Entertainment, Inc. and will assume the Caesars trading ticker at Eldorado’s stock price.  He advised shareholders of both entities approved the transaction on November 15, 2019.  Eldorado is in the process of obtaining gaming regulatory and FTC approvals with the intent of closing in spring 2020. 

    Mr. Reeg advised financing for the transaction is fully committed, led by JP Morgan and Credit Suisse, and syndicated to others.  Most of the existing debt structure will remain in place.  The only change in Caesars’ debt structure is the consolidation of the debt of Caesar Resort Collection and Caesar Entertainment Operating Corporation so that cash can move freely within the whole enterprise.  Eldorado will have a new $1 billion revolver, a new Term Loan B, Senior Secured Notes and Senior Unsecured Notes.  A Bridge loan is in place to backstop asset sales proceeds.  The existing $1 billion Caesars’ revolver loan will also remain in place.  Additionally, subsequent asset sales announced by each side were not included in the deal; therefore, reducing the amount of debt that had to be borrowed for the transaction.

    Mr. Reeg stated VICI will exercise its call options to acquire real estate at Harrah’s New Orleans, Harrah’s Atlantic City and Harrah’s Laughlin, which represents approximately $1.8 billion of the $3.2 billion in proceeds.  Those properties will go into the existing Caesars Regional Lease.  He indicated there is a corporate guarantee that backs all of the leases at these entities.  Mr. Reeg advised they will pay approximately $100 million more in rent under the Caesars Palace and Harrah’s Las Vegas lease, which represents the balance of the $1.4 billion of the $3.2 billion in proceeds.

    With regard to asset sales, Mr. Reeg noted Eldorado recently closed an asset sale to Century Casinos for $385 million in cash, and have announced an asset sale to Twin Rivers for $230 million cash, which is expected to close in the first half of 2020.  Caesars completed the sale of the Rio in Las Vegas for over $500 million in December. Eldorado recently announced the sale of Eldorado Shreveport for $230 million. 

    Mr. Reeg stated the combined company will be the largest United States gaming operator post-transaction with approximately 60 properties, over 50,000 rooms, over 70,000 slots, and coverage across the country.  He stated Eldorado is excited to gain access to the Caesars Rewards Players program, which they feel will benefit the existing Eldorado Iowa properties.

    With respect to the Iowa properties, Mr. Reeg stated they expect to continue investing in the properties, will focus on the Buy Iowa program, and empower and maintain the local leadership teams.

    Mr. Reeg closed his presentation by stating the most difficult time is the time between signing and closing when everyone is in limbo so they are trying to make that time as short as possible.  They are cognizant of the fact there are important steps each regulatory jurisdiction has to take.  He thanked the Commission for working with them.

    Hearing no comments or questions, Chair Kramer requested a motion regarding the acquisition.  Commissioner Andres moved to approve the acquisition of the stock of the ultimate parent company of the licensed operator, Harveys Iowa Management Company LLC, and of the management company, Harveys BR Management Company Inc. by Eldorado Resorts, Inc. Such approval also serves as approval of the Regional Lease that will be executed in connection with the merger and all other transaction documents that will be executed in order to effect the merger.

    Commissioner Heinrich seconded the motion, which carried unanimously.

    Chair Kramer requested a motion regarding the request for approval of a Shelf Application for Debt Financing.  Commissioner Gonseth Cheers moved to approve the shelf application for debt financing submitted by Eldorado Resorts, Inc. in connection with the merger of Caesars Entertainment Corporation with and into Eldorado Resorts, Inc. and for general corporate purposes.  Commissioner Heinrich seconded the motion, which carried unanimously.

    CONTRACT APPROVALS       (OSV – OUT OF STATE VENDOR; RP – RELATED PARTY):

    Dubuque Racing Association, Ltd.: Brian Rakestraw, General Manager, presented the following contracts for Commission approval:

    • Communications Engineering Co. (CEC) – Update Audio/Video Display System
    • Guest Supply – In-Room Guest Supplies per Hilton Specs (OSV)
    • Lincoln Financial Group – Employee Life, AD&D and STD Insurance
    • Weber Paper Company – Janitorial and Paper Supplies

    Hearing no comments or questions, Chair Kramer requested a motion.  Commissioner Lamberti moved to approve the contracts as presented.  Commissioner Andres seconded the motion, which carried unanimously.

    Diamond Jo, LLC: Wendy Runde, General Manager, presented the following contracts for Commission approval:  

    • The Printer, Inc. – Direct Mail Printing
    • Adams Outdoor Advertising of Madison, WI – Billboard Advertising (OSV)

    Hearing no comments or questions, Chair Kramer requested a motion.  Commissioner Heinrich moved to approve the contracts as submitted.  Commissioner Gonseth Cheers seconded the motion, which carried unanimously.

    Diamond Jo Worth, LLC: Scott Smith, General Manager, presented the following contracts for Commission approval:

    • AJB Enterprises – Snow Removal and Construction
    • CoreMark – Convenience Store and Food Service Distributor
    • King Food Service – Purchase Seafood and other Grocery Items
    • USA Security – Maintenance Contracts, Software, and Hardware Upgrades for Surveillance Equipment
    • Midwest Liquid Systems, Inc. – Maintenance of Gasoline Equipment and Operating System at Convenience Store, Jo Stop

    Hearing no comments or questions, Chair Kramer requested a motion.  Commissioner Andres moved to approve the contracts as submitted.  Commissioner Gonseth Cheers seconded the motion, which carried unanimously.

    Isle of Capri Bettendorf, L.C.: Nancy Ballenger, General Manager, presented a contract for   a Shared Service Agreement with Eldorado Resorts, Inc. (OSV). She stated they are aware of how important the Buy Iowa program is, and do focus on that.

    Hearing no comments or questions, Chair Kramer requested a motion.  Commissioner Gonseth Cheers moved to approve the contract as submitted.  Commissioner Andres seconded the motion, which carried unanimously.

    IOC Black Hawk County, Inc. d/b/a Isle Casino Hotel Waterloo: Thomas Roberts, General Manager, presented a contract for a Shared Service Agreement with Eldorado Resorts, Inc. (OSV).

    Hearing no comments or questions, Chair Kramer requested a motion.  Commissioner Heinrich moved to approve the contract as submitted.  Commissioner Gonseth Cheers seconded the motion, which carried unanimously.

    Riverside Casino & Golf Resort, LLC: Dan Franz, General Manager, presented a contract with CDW for a Software/Microsoft Office Standard License 2019 (OSV).

    Hearing no comments or questions, Chair Kramer requested a motion. Commissioner Lamberti moved to approve the contract as submitted.  Commissioner Andres seconded the motion, which carried unanimously.

    Rhythm City Casino, LLC: Sharon Haselhoff, General Manager at Grand Falls Casino Resort, LLC, presented a contract with Video Security Specialists for Surveillance Equipment and Software (OSV).

    Hearing no comments or questions, Chair Kramer requested a motion.  Commissioner Andres moved to approve the contract as submitted.  Commissioner Gonseth Cheers seconded the motion, which carried unanimously.

    Grand Falls Casino Resort, LLC: Ms. Haselhoff, General Manager, presented the First Amendment to the Advanced Deposit Sports Wagering Operator Agreement with Betfred Sports (Iowa) LLC.

    Hearing no comments or questions, Chair Kramer requested a motion.  Commissioner Lamberti moved to approve the First Amendment to the Advanced Deposit Sports Wagering Operator Agreement with Betfred Sports (Iowa) LLC. as presented.  Commissioner Heinrich seconded the motion, which carried unanimously.

    Ms. Haselhoff presented a License Agreement with Betfred Sports (Iowa) LLC for Commission approval.

    Hearing no comments or questions, Chair Kramer requested a motion.  Commissioner Andres moved to approve the License Agreement as presented.  Commissioner Lamberti seconded the motion, which carried unanimously.

    Ms. Haselhoff presented the following contracts for Commission approval:

    • Brockway Mechanical & Roofing Co. – Renovation Project: Mechanical, Plumbing & HVAC
    • Central Roofing Company – Renovation Project: Roofing and Roof Accessories (OSV)
    • Cummins Allison – Count Room Equipment Purchase and Maintenance Agreement
    • Lite Window & Door – Renovation Project: Aluminum Windows and Sliding Doors
    • Midwestern Mechanical, Inc. – Renovation Project: Design & Build Fire Suppression (OSV)
    • Murphy Company Insulation & Construction – Renovation Project: Insulation & Air Barrier (OSV)
    • Muth Electric – Renovation Project: Building Electric & Fire Alarm (OSV)
    • NBG Framing, LLC – Renovation Project: Wood Framing & Carpentry Labor (OSV
    • OneNeck IT Solutions, LLC – Technology Solutions: Hardware, Software, and Support Services
    • Peska Construction, Inc. – Renovation Project: Steel Erection (OSV)
    • Structural Component Systems, Inc. – Renovation Project: Wood Framing & Carpentry Materials

    She noted a majority of the contracts deal with the hotel construction project, which she hopes to have finished by the June 4th Commission meeting.  The construction project represents an approximate investment of $8.5 million.  Additionally, the sportsbook opened the Thursday before the Super Bowl.

    Chair Kramer pointed out there were several out-of-state contracts. She asked if Iowa bids were sought, and what their process was.  Ms. Haselhoff advised the construction contractor contacted numerous companies for bids, and they review the returned bids.  Due to the location of the facility, it is just not feasible for some companies to bid.

    Chair Kramer requested a motion.  Commissioner Heinrich moved to approve the contracts as submitted.  Commissioner Gonseth Cheers seconded the motion, which carried unanimously.

    Ameristar Casino Council Bluffs. LLC: Paul Czak, General Manager, presented the following contracts for Commission approval:

    • Bargreen Ellison – Purchase of Smallwares, China, Glass, F&B Equipment and Supplies (OSV)
    • Central Credit, LLC – Third Party Check Cashing Guarantor  (OSV)
    • Core BTS, Inc. – Computer Technology; Network Switches (OSV)
    • Evotek – Computer Hardware and Software (OSV)
    • Konica Minolta – 5-Year Lease Agreement for Copiers
    • Marketing Refrigeration – Replacement of BERG (liquor control) System (OSV)

    Commissioner Heinrich stated it is important to give Iowa vendors an opportunity to bid.  He stated he has been contacted by some vendors who feel they have not been contacted or provided an opportunity to submit a bid.  Mr. Czak stated Ameristar periodically holds open houses to reach out to vendors in the Council Bluffs and Pottawattamie County area to familiarize them with the needs of the property for the upcoming year, and the bidding and contracting process.  He advised the next open house is scheduled for the middle of April.

    Commissioner Heinrich moved to approve the contracts as submitted.  Commissioner Gonseth Cheers seconded the motion, which carried unanimously.

    SCE Partners, LLC: Jim Franke, General Manager, presented the following contracts for Commission approval:

    • Cunningham Group Architecture, Inc. – Design of the Parking Garage Retail Space (OSV)
    • Harmon Gaming Co. – Transfer of Truck (RP) (OSV)
    • Jim Franke – Transfer of Truck (RP)

    Chair Kramer advised the submissions for Harmon Gaming Co. and Jim Franke appear to relate to employee compensation, which the Commission cannot approve.  Commissioner Lamberti expressed the Commission’s appreciation for the disclosure, but concurred the contracts did not require approval.

    Commissioner Lamberti moved to approve the remaining contract as submitted.  Commissioner   Andres seconded the motion, which carried unanimously.

    Catfish Bend Casinos, LLC: Rob Higgins, General Manager, presented the following contracts for Commission approval:

    • Micro Gaming Technologies - Kiosk Purchase and Software License (OSV)
    • Design Wise – Construction of Casino’s Sportsbook (OSV)
    • Video Security Specialists – Purchase Upgraded Surveillance System (OSV)
    • The Printer, Inc. – Marketing/Printing Services

    Hearing no comments or questions, Chair Kramer requested a motion.  Commissioner Gonseth Cheers moved to approve the contracts as submitted.  Commissioner Andres seconded the motion, which carried unanimously.

    Prairie Meadows Racetrack & Casino, Inc. d/b/a Prairie Meadows Racetrack & Casino: Gary Palmer, General Manager, presented the following contracts for Commission approval:

    • Aramark Uniform – Table Linen Services
    • Agilysys – Accounting/Inventory Control/Recipe Building Software and Support (OSV)
    • Bankers Trust Company – Banking Services and Credit Cards
    • DirecTV (Rockstar Satellite) – Television Programming in Casino and Hotel
    • EMC Risk Services, LLC – Workers’ Compensation Insurance
    • Graphic Controls – Slot Game Tickets (OSV)
    • Iowa Cubs/Greater Des Moines Baseball – Advertising and Sky Box Rental Agreements (RP)
    • Liberty Fruit Company – Fruits, Vegetables and Other Produce
    • ODS Technologies dba TVG Network – Televising Horse Races and Marketing Ventures (OSV)
    • Professional Solutions (NCMIC) – Merchant Processing Fees for Various Credit Cards
    • Rockstar Satellite (DirecTV) – Video Equipment Installation in Casino and Hotel
    • The Printer Inc. – Printing Services
    • Van Wall Equipment (Farmers Supply) – Track and Grounds Equipment, Parts and Service
    • William Hill Sports Book/American Wagering – Banking Support

    Hearing no comments or questions, Chair Kramer requested a motion.  Commissioner Heinrich moved to approve the contracts as submitted.  Commissioner Gonseth Cheers seconded the motion, which carried unanimously.

    Iowa Greyhound Association d/b/a Iowa Greyhound Park: Brian Carpenter, General Manager and Director of Racing, requested approval of the Amended License Renewal Application to add two off-track betting sites, Wild Rose Emmetsburg and Wild Rose Jefferson. He noted the Simulcast Wagering Agreements for each site were also submitted for Commission approval. 

    Chair Kramer advised the approval of the amended license renewal would be handled separately.  Hearing no comments or questions, she requested a motion.  Commissioner Andres moved to approve the Amended License Renewal Application and Granting of Race Dates for January 1, 2020 through December 31, 2020.  Commissioner Heinrich seconded the motion, which carried unanimously.

    Chair Kramer stated the Simulcast Wagering Agreements with Wild Rose Emmetsburg, L.L.C. and Wild Rose Jefferson, L.L.C. would be handled simultaneously.  Commissioner Lamberti moved to approve the Simulcast Wagering Agreements as submitted.  Commissioner Gonseth Cheers seconded the motion, which carried unanimously.

    HEARINGS:

    Isle of Capri Bettendorf, L.C.: Mr. Ohorilko stated Commission staff and Isle of Capri Bettendorf, L.C. (IOC Bettendorf) had entered into a Stipulated Agreement for a violation of Iowa Code Section 99F.9(4) and (5)a, which relate to a minor gaining access to the gaming floor.  Mr. Ohorilko noted that on September 14th, in an attempt to gain something of value from IOC Bettendorf, a female patron informed the facility that her underage son had been on the gaming floor. Upon investigation and review of surveillance, it was determined the minor did enter the floor unchallenged, and was on the floor for over 30 minutes.  There were photos provided by the mother which showed the minor with credits on a slot machine and standing next to a kiosk with money.  Mr. Ohorilko noted the individual entered the floor unchallenged and was on the floor for over thirty minutes, and may have participated in gambling.  The mother was charged with contributing to the delinquency of a minor.  As a result of these facts, Commission staff and IOC Bettendorf have agreed to an administrative penalty in the amount of $10,000. 

    Ms. Ballenger stated the last time she was before the Commission for a violation of this nature was almost nine years ago.  The property is proud of their program and training offered to the employees to prevent to these types of incidents.  She noted the minor had been turned away twice, and it was only when the mother distracted the security staff that the minor was able to gain access to the floor.  The mother then tried to extort the staff.  Ms. Ballenger noted the mother was charged and convicted of contributing to the delinquency of a minor. She thanked the Commission for taking the extenuating circumstances into consideration.

    Commissioner Lamberti stated the Commission has seen several instances over the years where people are engaging in intentional misconduct, and is appreciative of the fact the mother was charged.  He indicated he would prefer to see some stiffer penalties at the legislative level for those individuals as it seems to be a regular occurrence. 

    Chair Kramer requested a motion.  Commissioner Andres moved to approve the Stipulated Agreement with an administrative penalty of $10,000.  Commissioner Gonseth Cheers seconded the motion, which carried unanimously.

    HGI Lakeside, LLC:  Mr. Ohorilko advised Commission staff and HGI-Lakeside, LLC (Lakeside) have entered into a Stipulated Agreement for a violation of Iowa Code Section 99F.9(4) related to underage gambling. On August 20th, at approximately 10:56 am an underage male entered the gaming floor with an adult companion.  The minor entered the floor unchallenged, was on the floor and subsequently exited, and then re-entered.  The minor again exited the gaming floor and re-entered the casino.  At that time while on the floor, the minor was approached by the slot supervisor who requested identification.  Security subsequently removed the minor from the gaming floor.  The minor exited the gaming floor and attempted to regain entry a few hours later but was denied entry by the security officer posted at that time.  Mr. Ohorilko stated the minor entered the gaming floor unchallenged, was on the gaming floor collectively in excess of 30 minutes, and did gamble.  He stated Commission staff and Lakeside have agreed to an administrative penalty of $20,000.

    David Monroe, General Manager, stated the facility takes the responsibility to keep minors off the gaming floor very seriously, and have instituted some of the toughest controls.  They card everyone under the age of 40.  If an individual does not have a valid ID, they are not allowed to enter the floor.  If an individual leaves the gaming floor, their ID will be checked again if they want to re-enter the gaming floor.  In this situation, the first security officer, who had been employed for 12 years, failed to follow the protocols.  Mr. Monroe stated the employees have been re-trained, and feels confident the correct protocols are in place to prevent further breakdowns.

    Commissioner Gonseth Cheers moved to approve the Stipulated Agreement with an administrative penalty of $20,000.  Commissioner Heinrich seconded the motion, which carried unanimously.

    Prairie Meadows Racetrack and Casino, Inc.: Mr. Ohorilko advised Commission staff and Prairie Meadows Racetrack and Casino, Inc. (PMR&C) have entered into a Stipulated Agreement for a violation of Administrative Rule 491-10.4(5)“a” related to the acceptance of entries in the Racing Office and Administrative Rules 491-10.4(5)“k” and 10.6(1)“b”(5) related to the Coggins test, which is required as part of the racing industry.  Mr. Ohorilko advised the first incident occurred on August 2nd, and involved a horse that won a race at PMR&C.  The horse was claimed in the race; however, the next day PMR&C staff noticed the horse, which had raced, had an expired Coggins test. The Board of Stewards was notified, and they subsequently voided the claim and determined the horse was ineligible to receive the winner’s purse share.  The Board of Stewards’ actions triggered an appeal to an Administrative Law Judge (ALJ).  The ALJ’s decision was then appealed to the Commission and was heard at the October 3rd Commission meeting.  That error took a significant amount of time and funds expended by all parties trying to figure out the situation, which could have been avoided.

    Mr. Ohorilko stated the second incident occurred on August 29th when the trainer of a horse contacted the racing staff by phone to enter his horse in a race; however, racing staff failed to properly enter the horse in the race.   The race was a stakes race, which could be a once in a lifetime opportunity for a horse to participate.  Racing staff notified the Board of Stewards of the error.  The Board of Stewards determined the horse could not be entered in the race, nor could the race be re-drawn as entries were closed and the official overnight sheet had been disseminated.  This action resulted in a Request for a Stay.  Commission staff subsequently ordered the horse into the race but the race would not be redrawn.  The horse had to settle for the outside post position.  He stated the Commission and Prairie Meadows were lucky nothing further happened as a result of this situation.

    Mr. Ohorilko stated PMR&C has agreed to pay an administrative penalty up to $20,000 as determined by the Commission.  He stated Derron Heldt, Director of Racing, has provided a letter describing the incidents and some of the actions and corrective steps taken to prevent these types of incidents from happening again.

    Mr. Heldt stated PMR&C takes these violations very seriously.  During this process, the horse identifier was suspended and eventually terminated.  Three new procedures have been put in place in the Racing Office for the horse identifier to follow, and additional help has been provided to the racing office.  With regard to the second violation, the entry into the Stakes race was a human error.  The individual took an entry over the phone from the trainer, and instead of following protocol and writing it on an entry card and entering it in the computer system, they wrote the information on a piece of paper.  The individual then took another phone call or was called away from the desk so the entry was not entered into the system for the race.  Mr. Heldt stated he believes the correct procedures are in place; they will do re-training at the start of the new season.

    Commissioner Lamberti thanked Mr. Heldt for addressing the issues.  He feels the issues were the result of human errors; that there was nothing intentional.  Commissioner Lamberti noted the two situations consumed a lot Commission staff time, and one situation could have been much worse than it was. 

    Hearing no further comments, Chair Kramer requested a motion.  Commissioner Lamberti moved to approve the Stipulated Agreement with an administrative penalty of $20,000.   Commissioner Andres seconded the motion, which carried unanimously.

    Board of Stewards v Jose Amaya Rocha: Chair Kramer advised this is an appellate type review – a de novo review, however, the Commission is not re-hearing the evidence.

    Chair Kramer stated the Commission will hear a ten minute argument from each side with the Appellant going first. After the Appellee argues, the Appellant receives an additional five minutes for rebuttal. At their discretion, the Commission may allow an additional five minutes for the Appellee.

    Jeff Peterzalek, Assistant Attorney General, is representing the Board of Stewards in this matter.  The Board of Stewards suspended Mr. Amaya Rocha’s license for a year. 

    Mr. Peterzalek noted the Commission is in charge of enforcing the rules and statutes relating to racing and gaming.  In order to do that across the State of Iowa, the Commission hires individuals to help enforce the rules and regulations.  On the gaming side, there are gaming representatives; on the racing side, it is stewards.  He stated the stewards are in charge of the entire spectrum of issues that come about because of racing, including monitoring entries, monitoring who is on the backside of the track, watching every race that is run, etc.  When a rule violation comes to their attention, they hold a hearing.  During the hearing, the Board of Stewards will hear evidence from the person accused of the violation, and then make a decision.  The Board of Stewards is made up of three individuals with a combined experience of just over 100 years between them.  Once the decision has been issued, the party at issue has an opportunity to appeal the decision to the Commission; however the Commission is not in a position to hear every appeal.  Appeals are transferred to the Department of Inspections and Appeals where an Administrative Law Judge (ALJ) will issue a Proposed Decision to the Commission.  Mr. Peterzalek stated most of the time Commission staff, in this case the Stewards, get it right. If the Stewards’ ruling is appealed, it goes to the ALJ, who issues a Proposed Decision affirming the Stewards’ ruling.  Sometimes, the Stewards’ don’t get it right and the issue gets straightened out during the same administrative process. Sometimes the ALJ gets it wrong, which is what happened in this case. 

    In this case, Mr. Amaya Rocha was putting a trainer’s name down on entry forms identifying a trainer to people on the backside at PMR&C who knew this trainer was not in the State of Iowa, was not training horses in the State of Iowa, and was not participating in racing in the State of Iowa. This aspect of the case is undisputed.  Mr. Amaya Rocha acknowledges that, and the ALJ acknowledged the fact in his findings.  The ALJ also pointed out a number of other pieces of evidence that would support the affirmance of the Board of Stewards’ decision.  The ALJ pointed out that Mr. Amaya Rocha acknowledged he put Trainer Jose Ibarra’s name on entry forms, referenced a statement from David Kerrigan, a jockey agent at PMR&C, who acknowledged taking the entry from Mr. Amaya Rocha, and the actual entry form itself identifying the trainer as Jose Ibarra. Rick Evans, testifying on behalf of the Board of Stewards, presented testimony to the ALJ and Mr. Amaya Rocha through each and every step of the process.

    Mr. Peterzalek stated the puzzle in this case is that the ALJ identified each piece of evidence, went through the pieces of evidence, and then disregarded all of them and said the Board of Stewards’ decision was not supported by any evidence; that they did not meet the burden of proof.  This the issue before the Commission today.  It’s not so much whether a rule violation occurred or didn’t occur; it clearly occurred.  Mr. Peterzalek noted that Mr. Amaya Rocha testified during the hearing that he had permission to put the trainer’s name on the entry form. The Stewards’ didn’t find that statement to be credible; and even if the ALJ or Commission found the statement to be credible, it does not mitigate the fact there was a rule violation and may lessen the penalty involved.

    Mr. Peterzalek stated his role today is to ask the Commission, based on the evidence presented at the hearing and disregarded by the ALJ, to reverse the Proposed Decision issued by the ALJ and affirm the Board of Stewards’ Decision.  If during this process it is determined that Mr. Amaya Rocha should have a lesser penalty, the Commission has the authority to do that. He stated the main purpose of the appeal is two-fold.  The first is that there was substantial evidence to support the Board of Stewards’ Decision, and, most importantly, there is no dispute a rule violation occurred and the finding by the ALJ to the contrary was clearly in error and should be reversed by the Commission. 

    Mr. Amaya Rocha, through interpreter Suzanne Wedeking, stated he was in agreement with what Mr. Peterzalek said; that what they are accusing me of is true.  He stated the trainer, Jose Ibarra, gave him permission to do what he did.  He stated that if his license is returned, all he does is exercise the horses and do what they tell me to do.  We were putting the horse in the name of Jose Ibarra because he was supposed to come here.  Mr. Amaya Rocha stated Mr. Ibarra was in agreement with everything that was done.

    Mr. Peterzalek stated Mr. Amaya Rocha’s statements were very much the same today as they were at the hearing.  He reiterated the dispute is not whether or not there was a rule violation but whether he had permission to do what he did and if that should be considered a mitigating factor.  Mr. Peterzalek stated it is an unusual situation where the accused and the Board of Stewards are in agreement and the only entity not in agreement is the ALJ.

    Mr. Amaya Rocha, through the interpreter, asked whether or not the Commission would consider reinstating his license, or set a lesser penalty as this is his line of work and it is what he knows how best to do.

    Commissioner Lamberti indicated that is all part of the Commission’s consideration as they deliberate on their decision. 

    Hearing no further comments or questions, Chair Kramer requested a motion to go into Executive Session.  Commissioner Heinrich moved to go into Executive Session pursuant to Iowa Code Section 21.5(1) for the purpose of discussing the decision to be rendered in a contested case conducted according to the provisions of chapter 17A.  Assistant Attorney General William Hill will be acting as conflict counsel for the Commission.  Commissioner Lamberti seconded the motion, which carried unanimously on a roll call vote.

    Following the conclusion of Executive Session, Chair Kramer reconvened the meeting in open session, and requested a motion.

    Commissioner Lamberti advised there was substantial evidence presented in the matter to support the Board of Stewards’ decision.  Commissioner Lamberti moved to reinstate the decision of the Stewards, but to modify the penalty to reduce the suspension to a period of nine months as opposed to twelve.  The motion further directed Commission staff to draft an order consistent with this motion.  Commissioner Heinrich seconded the motion, which carried unanimously.

    PUBLIC COMMENT/ADMINISTRATIVE BUSINESS: None

    ADJOURN:  Hearing no further business to come before the Commission, Chair Kramer requested a motion to adjourn.  Commissioner Gonseth Cheers moved to adjourn the meeting.  Commissioner Andres seconded the motion, which carried unanimously.