Kansas Star Casino’s economic impact strong in first year of operation

12/09/2012 10:24 AM

08/05/2014 10:59 PM

The Kansas Star Casino marks its first year in business this month.

From its opening on Dec. 20, 2011, through the end of October, the casino had earned $158.8 million, according to the Kansas Lottery Commission, topping the revenue earned in nearly the same period by the two other state-owned casinos, Boot Hill Casino in Dodge City, which earned $119.4 million, and Hollywood Casino in Kansas City, which since its Feb. 3 opening has earned $93.3 million.

The Kansas Star is operated by Las Vegas-based Boyd Gaming, which completed its acquisition of Peninsula Gaming in November.

“It’s been a very good first year from all aspects,” said Scott Cooper, Kansas Star’s general manager. “I think we have exceeded our expectations in terms of the number of people who have visited here and the number of people we have employed.

“We have ramped up faster from what we originally expected.”

The casino now employs nearly 1,000 people, compared with roughly 400 workers a year ago.

“We managed to employ more people than we thought we would,” Cooper said.

The casino opens part of its permanent building Wednesday.

It’s also been a good year for the county and city governments that share the gaming revenue of the Kansas Star, public officials said.

“It’s been a great impact,” said Sumner County Commissioner Jim Newell. “It’s been kind of what we expected. Of course most of the money we receive from the casino went to property tax reduction this year.

“The taxpayers have indicated to me they are very happy with that decision.”

Through Oct. 31, Sumner and Sedgwick counties and Mulvane each received more than $1.5 million from the casino’s gaming revenue.

Cooper said 22 percent of Kansas Star’s gaming revenue goes to the state, while 2 percent is earmarked for the problem gambling and addictions grant fund. Three percent is split equally between Sedgwick and Sumner counties and Mulvane.

Gaming revenue from the casino has allowed the Sumner County Commission to reduce county property taxes by 27 percent.

In Mulvane, city Administrator Kent Hixson said, gaming revenue enabled the city to reduce residents’ electric utility rates by 5 percent. In fiscal year 2013, the city will be able to lower residents’ property tax bills because of casino revenue, he said.

“Before the casino came online, our property tax base was $33 million,” Hixson said. “This year’s addition from the casino added about $22 million to the tax base.”

The expanded tax base prompted Mulvane officials to reduce property taxes 10 percent.

“That’s a direct result of the tax base expansion from the casino,” Hixson said.

In Sedgwick County, Commission Chairman Tim Norton said gaming revenue has helped the county avoid making reductions in services and programs as it wrestled with less revenue coming in. He said $1.5 million doesn’t have the same impact on a budget that’s hundreds of millions of dollars compared with one that’s a fraction of that, but “every little bit helps.”

“It might have been another million and a half we had to come up with through some other source or had to reduce some services elsewhere,” Norton added.

Sedgwick County’s fiscal 2013 budget is $408 million; Sumner County’s is $20.1 million.

Cooper is looking for gaming revenue to increase as the Kansas Star wraps up its remaining projects. Projections by Cummings Associates of Arlington, Mass., one of the consultants hired by the state when it was considering proposals for a Sumner County casino in 2010, projected gaming revenue of $192.1 million in 2014, and $213.4 million in 2016.

Next week, the casino will open a portion of its permanent casino as it transitions from its temporary quarters. But before that happens, officials will close the casino on Monday and Tuesday to move hundreds of slot machines and table games to the permanent casino.

At 8 a.m. on Wednesday, a portion of the permanent casino comprising about 1,000 slot machines, 35 table games and a poker room that’s doubled in size will open, as will as three of five restaurants, including a buffet and an Asian noodle bar.

On Dec. 21, all of the permanent casino will open, as will two more restaurants: a steak house and a deli.

The opening of the permanent casino along with the restaurants and the 150-room Hampton Inn and Suites — which opened in mid-October — “makes us a regional destination,” Cooper said.

The permanent casino will have 1,829 slot machines and 45 gaming tables.

The final piece of the $325 million Kansas Star project is the arena that has housed the temporary casino. The 3,500-fixed-seat arena — it can be bumped up to 5,000 seats by adding chairs on the arena floor — will undergo remodeling next summer, and will take about six months to complete. In conjunction with the arena, which will host concerts, trade shows and other events, plans call for an outdoor, 24-acre equestrian center with arenas and more than 600 stalls. That project is expected to be completed for the 2015 season.

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