While state regulators investigate possible malfeasance by executives at Spectacle Entertainment and put a hold on approval of a Terre Haute casino, the company's Lake County gaming operations are moving forward.

A land-based casino near the Borman Expressway in Gary is under construction and the company is operating a riverboat casino on Lake Michigan until then. But a bill that would have helped Gary pay for security at the new casino was killed in the Indiana General Assembly.

The amendment to a broad tax bill, HB 1065, would have imposed a 1% food and beverage tax at the planned Hard Rock Northern Indiana Casino to help pay for public safety, potentially generating between $115,000 to $230,000 a year. The amendment was added late in the session by Sen. Travis Holdman, R-Markle, and had advanced to a Senate-House conference committee but was removed in the last few days.

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Holdman said the amendment didn't have enough support from House members to pass. 'It came in so late, they didn't really have time to vet it,' Holdman said. 'It was a late effort on my part to respond to a local request.'

The tax was pushed by newly-elected Gary Mayor Jerome Prince, who wanted a city-wide tax but agreed to limit its scope.

'It was originally designed to encompass the whole city but we are satisfied with the compromise,” Prince said before the amendment was removed, 'which accomplishes most of what we wanted, which was improve security around the casino.'

The Hard Rock casino levy would have been only on food and drinks in the casino and would have gone into city coffers to be used for security cameras and other technology inside and outside of the casino. It would have expired in 2025.

Prince said he'd consulted with Spectacle, which had no objection to the tax.

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Spectacle Vice President of Operations and General Manager Jahnae Erpenbach said in a written statement 'the additional source of revenue will aid the City of Gary in (its) much-needed revitalization endeavors.”

Lake County tourism officials generally oppose food and beverage taxes but had made an exception for this amendment, said Speros Batistatos, president the South Shore Convention and Visitors Authority.

“We believe that a casino willing to tax itself to assist in paying for public safety is a legitimate way to re-invest those revenues,” Batistatos said. “It’s not going for development or to close a budget gap or any other thing we might object to.”

Holdman said the bill's failure this year isn't critical because the tax wouldn't go into effect until 2022, after the casino is opened, and can be introduced again next year.

'All hope is not lost,' Holdman said.

Prince agreed.

'I'm slightly disappointed,' he said, 'but optimistic we can try again next year.'

Senate Bill 178: Bill that could have ousted Attorney General Curtis Hill won't become law

Under investigation

While Spectacle's Gary casino is at least on track to open by the end of this year or early 2021, the future of its other land-based casino, planned for Terre Haute, is uncertain.

The Indiana Gaming Commission postponed a vote on the licence approval Feb. 7 after a political consultant in Virginia pleaded guilty in federal court to making illegal campaign contributions connected to Spectacle officials.

According to the federal court case, the consultant said he arranged more than $10,000 in donations to an unnamed Indiana congressional candidate in 2016 and the then-vice president and general counsel of the Indiana casino company helped coordinate the transfer of the money.

John Keeler was the vice president and general counsel of Centaur at that time and now serves in a similar role for Spectacle, though his name was not cited in the court case.

Campaign contributions indicate that the candidate in the federal court case is former state Sen. Brent Waltz of Greenwood.

It's unclear why Waltz, then a state senator, would have been targeted. Waltz, who doesn't face any charges, has said he was not aware the contributions were illicit and cooperated with federal authorities.

Gaming Commission Deputy Director Jenny Reske said a team of investigators is probing the facts of case to determine if Keeler’s alleged involvement in the payments precludes him from being a casino operator.

“We want to make sure that key owners were not impacted,” Reske said, 'and their suitability is not called into question.'

Suitability is a catch-all term in the state’s gambling law that allows the commission to take action against owners with ties to organized crime or who otherwise “compromise the integrity of gaming in Indiana, tarnish the image and reputation of the state of Indiana, or reflect poorly on an Indiana casino licensee,” according to Indiana statute.

The IGC could deny, revoke or suspend a gaming license if it finds an owner unsuitable, could ban a casino executive or fine and reach a settlement with the company, Reske said. She added that no casino has ever had its license revoked in Indiana because of suitability issues.

Reske said a Terre Haute casino license would not be issued before the investigation of Spectacle is complete but neither would the agency disrupt operations at Spectacle's other casinos.

'We're sensitive to negative impacts that would have on local communities,” Reske said.

The IGC is allowing Spectacle operations in Lake County to proceed because to take action against them before the investigation is complete would harm the employees and the region, Reske said.

She could not estimate how long the investigation into possible illegal campaign contributions would last but added that it depends almost entirely on the pace of the federal investigation.

Spectacle declined to comment on the gaming commission investigation.

Intense lobbying

Centaur operated the state’s two horse-track and casinos in Anderson and Shelbyville until it sold the racinos to Caesars Entertainment in 2018. The same Centaur executives formed Spectacle in 2018 to acquire two riverboat casinos in Gary — Majestic I and Majestic II. The company lobbied the legislature to build a land-based casino in Gary with one of the riverboat permits, relinquish the other permit and then apply for a land-based casino license in Terre Haute.

In pursuit of those new permits, Spectacle has aggressively lobbied Indiana's top lawmakers, raising accusations by good government watchdogs of influence peddling and conflict of interest.

An IndyStar investigation revealed that Spectacle paid more than $50,000 to fly Gov. Eric Holcomb to Republican Governors Association meetings in July and November of 2018, giving investors exclusive access to the governor. Shortly afterward, the company announced plans to buy the Gary riverboats. Holcomb signed a new expanded gambling bill in 2019. The Indiana Inspector General investigated the meetings and ruled that Holcomb violated no ethics rules.

In addition, one of Spectacle's principal investors, Greg Gibson, arranged a contract for House Speaker Brian Bosma and his law firm last year with the Vigo County Capital Improvement Board — a local entity that stands to benefit from the casino by the taxes it generates for the county. Bosma recused himself from votes on the big casino legislation after facing questions about a conflict of interest, though he was not required by law to step aside.

Spectacle hired Rep. Jerry Torr, R-Carmel to provide title insurance and closing services to the company when it purchased the two Gary casinos. Torr then voted in favor of the legislation benefiting Spectacle.

Spectacle hoped to begin construction on the 100,000-square-foot casino in Terre Haute soon after getting licence approval and open as soon as a year later, county officials said.

Vigo County officials are eager to see the casino open because the county and city stand to gain more than $7 million annually in wagering and admission taxes and add an estimated 650 jobs.

'We want to start collecting these gaming taxes and the food and beverage tax so we want to get a license going as quickly as possible,' Vigo County Commission President Brad Anderson said. 'We can't do anything but wait at this point.'

In addition, Vigo lawmakers recently approved a countywide 1% food and beverage tax to help pay for a new convention center and are depending on taxes at the casino for a boost in those collections.

The Hard Rock Northwest casino could open by the end of 2020.

Call IndyStar reporter John Tuohy at 317-444-6418. Email at john.tuohy@indystar.com and follow on Twitter and Facebook.

This article originally appeared on Indianapolis Star: Spectacle Entertainment's Terre Haute casino is on hold but games proceed in Gary

While state regulators investigate possible malfeasance by executives at Spectacle Entertainment and put a hold on approval of a Terre Haute casino, the company's Lake County gaming operations are moving forward.

A land-based casino near the Borman Expressway in Gary is under construction and the company is operating a riverboat casino on Lake Michigan until then. But a bill that would have helped Gary pay for security at the new casino was killed in the Indiana General Assembly.

The amendment to a broad tax bill, HB 1065, would have imposed a 1% food and beverage tax at the planned Hard Rock Northern Indiana Casino to help pay for public safety, potentially generating between $115,000 to $230,000 a year. The amendment was added late in the session by Sen. Travis Holdman, R-Markle, and had advanced to a Senate-House conference committee but was removed in the last few days.

Holdman said the amendment didn't have enough support from House members to pass. 'It came in so late, they didn't really have time to vet it,' Holdman said. 'It was a late effort on my part to respond to a local request.'

The tax was pushed by newly-elected Gary Mayor Jerome Prince, who wanted a city-wide tax but agreed to limit its scope.

'It was originally designed to encompass the whole city but we are satisfied with the compromise,” Prince said before the amendment was removed, 'which accomplishes most of what we wanted, which was improve security around the casino.'

The Hard Rock casino levy would have been only on food and drinks in the casino and would have gone into city coffers to be used for security cameras and other technology inside and outside of the casino. It would have expired in 2025.

Prince said he'd consulted with Spectacle, which had no objection to the tax.

What Is The Closest Casino In Terre Haute Ind

Spectacle Vice President of Operations and General Manager Jahnae Erpenbach said in a written statement 'the additional source of revenue will aid the City of Gary in (its) much-needed revitalization endeavors.”

Terre Haute Casino News

Lake County tourism officials generally oppose food and beverage taxes but had made an exception for this amendment, said Speros Batistatos, president the South Shore Convention and Visitors Authority.

“We believe that a casino willing to tax itself to assist in paying for public safety is a legitimate way to re-invest those revenues,” Batistatos said. “It’s not going for development or to close a budget gap or any other thing we might object to.”

Holdman said the bill's failure this year isn't critical because the tax wouldn't go into effect until 2022, after the casino is opened, and can be introduced again next year.

'All hope is not lost,' Holdman said.

Prince agreed.

'I'm slightly disappointed,' he said, 'but optimistic we can try again next year.'

Senate Bill 178: Bill that could have ousted Attorney General Curtis Hill won't become law

Under investigation

While Spectacle's Gary casino is at least on track to open by the end of this year or early 2021, the future of its other land-based casino, planned for Terre Haute, is uncertain.

The Indiana Gaming Commission postponed a vote on the licence approval Feb. 7 after a political consultant in Virginia pleaded guilty in federal court to making illegal campaign contributions connected to Spectacle officials.

According to the federal court case, the consultant said he arranged more than $10,000 in donations to an unnamed Indiana congressional candidate in 2016 and the then-vice president and general counsel of the Indiana casino company helped coordinate the transfer of the money.

John Keeler was the vice president and general counsel of Centaur at that time and now serves in a similar role for Spectacle, though his name was not cited in the court case.

Campaign contributions indicate that the candidate in the federal court case is former state Sen. Brent Waltz of Greenwood.

It's unclear why Waltz, then a state senator, would have been targeted. Waltz, who doesn't face any charges, has said he was not aware the contributions were illicit and cooperated with federal authorities.

What Is The Closest Casino To Terre Haute Indiana

Gaming Commission Deputy Director Jenny Reske said a team of investigators is probing the facts of case to determine if Keeler’s alleged involvement in the payments precludes him from being a casino operator.

“We want to make sure that key owners were not impacted,” Reske said, 'and their suitability is not called into question.'

Suitability is a catch-all term in the state’s gambling law that allows the commission to take action against owners with ties to organized crime or who otherwise “compromise the integrity of gaming in Indiana, tarnish the image and reputation of the state of Indiana, or reflect poorly on an Indiana casino licensee,” according to Indiana statute.

The IGC could deny, revoke or suspend a gaming license if it finds an owner unsuitable, could ban a casino executive or fine and reach a settlement with the company, Reske said. She added that no casino has ever had its license revoked in Indiana because of suitability issues.

Reske said a Terre Haute casino license would not be issued before the investigation of Spectacle is complete but neither would the agency disrupt operations at Spectacle's other casinos.

'We're sensitive to negative impacts that would have on local communities,” Reske said.

The IGC is allowing Spectacle operations in Lake County to proceed because to take action against them before the investigation is complete would harm the employees and the region, Reske said.

She could not estimate how long the investigation into possible illegal campaign contributions would last but added that it depends almost entirely on the pace of the federal investigation.

Spectacle declined to comment on the gaming commission investigation.

Intense lobbying

Centaur operated the state’s two horse-track and casinos in Anderson and Shelbyville until it sold the racinos to Caesars Entertainment in 2018. The same Centaur executives formed Spectacle in 2018 to acquire two riverboat casinos in Gary — Majestic I and Majestic II. The company lobbied the legislature to build a land-based casino in Gary with one of the riverboat permits, relinquish the other permit and then apply for a land-based casino license in Terre Haute.

In pursuit of those new permits, Spectacle has aggressively lobbied Indiana's top lawmakers, raising accusations by good government watchdogs of influence peddling and conflict of interest.

An IndyStar investigation revealed that Spectacle paid more than $50,000 to fly Gov. Eric Holcomb to Republican Governors Association meetings in July and November of 2018, giving investors exclusive access to the governor. Shortly afterward, the company announced plans to buy the Gary riverboats. Holcomb signed a new expanded gambling bill in 2019. The Indiana Inspector General investigated the meetings and ruled that Holcomb violated no ethics rules.

In addition, one of Spectacle's principal investors, Greg Gibson, arranged a contract for House Speaker Brian Bosma and his law firm last year with the Vigo County Capital Improvement Board — a local entity that stands to benefit from the casino by the taxes it generates for the county. Bosma recused himself from votes on the big casino legislation after facing questions about a conflict of interest, though he was not required by law to step aside.

Spectacle hired Rep. Jerry Torr, R-Carmel to provide title insurance and closing services to the company when it purchased the two Gary casinos. Torr then voted in favor of the legislation benefiting Spectacle.

Spectacle hoped to begin construction on the 100,000-square-foot casino in Terre Haute soon after getting licence approval and open as soon as a year later, county officials said.

Vigo County officials are eager to see the casino open because the county and city stand to gain more than $7 million annually in wagering and admission taxes and add an estimated 650 jobs.

'We want to start collecting these gaming taxes and the food and beverage tax so we want to get a license going as quickly as possible,' Vigo County Commission President Brad Anderson said. 'We can't do anything but wait at this point.'

In addition, Vigo lawmakers recently approved a countywide 1% food and beverage tax to help pay for a new convention center and are depending on taxes at the casino for a boost in those collections.

The Hard Rock Northwest casino could open by the end of 2020.

Call IndyStar reporter John Tuohy at 317-444-6418. Email at john.tuohy@indystar.com and follow on Twitter and Facebook.

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This article originally appeared on Indianapolis Star: Spectacle Entertainment's Terre Haute casino is on hold but games proceed in Gary/free-triple-lucky-seven-slots.html.