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A judge in Iowa has rejected a request for a stay on the license for the Cedar Crossing Casino & Entertainment Center in Cedar Rapids, Iowa. The motion came from Riverside Casino & Gulf Resort, which is about 30 miles south of Cedar Rapids and has expressed concerns about a substantial loss in revenue if Cedar Crossing opens.
Construction on the Cedar Crossing casino began in February after it received the go-ahead from the Iowa Racing & Gaming Commission. Although the court declined to put a temporary halt to the project, there is still the broader lawsuit challenging the 2021 Linn County referendum that granted local approval for the project. That is still moving forward, with a hearing set for early April.
That litigation could still at least delay the execution of the license. Moreover, the judge presiding over the case has indicated that, despite denying the stay, he sees merit in the case.
Request for stay goes unfulfilled
Since the Iowa Racing and Gaming Commission (IRGC) voted to approve the license application for Cedar Crossing, Riverside has been active in attempting to prevent the execution of the license. Originally, Riverside filed a complaint with the IRGC but after that failed to grant the desired result, Riverside levied its lawsuit.
Riverside’s arguments in its lawsuit included that the IRGC failed to properly consider the economic impact on the state of granting the license for Cedar Crossing and that developers moving forward on the project would do irreparable damage to Riverside’s business.
According to Trish Mehaffey of The Gazette, Judge Michael Schilling ruled that Riverside failed to convince him of that premise. However, Schilling found some merit in another part of Riverside’s complaint.
Schilling’s opinion found that Riverside did establish that it has a sufficient chance of success in a trial on the merits of its argument that the 2021 referendum in Linn County authorizing gaming within the county was flawed. At issue is the language of that referendum.
Language of referendum is pivotal issue for Cedar Crossing
Voters in Linn County have approved gambling twice, with 2021 being the most recent instance. That referendum asked residents whether gambling “may continue” in the county.
Riverside argues that because there was no land-based casino in the county at that time, a referendum that merely preserved the status quo is insufficient to authorize new gaming in Linn County.
Mehaffey reports that Schilling’s opinions states that, “arguably, the Linn County voters approved only gambling games with no wager or loss limits, not a broader spectrum of gambling games. If an inconsistency exists between what the voters approved and the license the (commission) issues, the question arises whether the license reflects the will of the voting public.”
That will be the question that the trial court will need to decide. Appeals are likely, meaning the issue could rise to the Iowa Supreme Court.
Victory for Riverside might cause significant delays. However, it might not permanently prevent the development of a casino in Iowa’s second-most populous city.
Nullification of Cedar Crossing license might prompt third referendum
Proponents of casino gaming in Cedar Rapids have been trying to get a license for years and may not be deterred by the nullification of the current license. That would not prevent the county from holding a third referendum to explicitly authorize such gaming and then applying for a license again.
Such a process could give Riverside to lobby against the issuance of a new license, potentially by convincing state lawmakers to re-impose a former moratorium on new licenses. A bill toward that end cleared the Iowa House of Representatives before failing to see a vote on the Iowa Senate floor in January.
For the time being, Linn County is preparing to defend its 2021 referendum. This lawsuit by Riverside could represent the final obstacle to making Cedar Crossing a reality.
