The Lawrence Downs Project: Doomed to fail
Published: Sunday, Oct. 6, 2013, 9:00 p.m.
Private-sector unwillingness to go it alone is a warning about a development project's viability that no governmental entity should ignore — especially when the project is as risky as the proposed Lawrence Downs Casino & Racing Resort.
Yet Dan Vogler, chairman of the Lawrence County Board of Commissioners, says his county's Industrial Development Authority has voted to sell $50 million in taxable bonds to assist the $225 million harness track and casino project planned for Mahoning. He says bondholders, not taxpayers, would bear the bonds' risk; the county wouldn't guarantee them, but they'd be repaid from its “local share assessment” of the casino's take.
Even if taxpayers wouldn't end up on the hook, it's less than promising. Without the bond money, Penn National Gaming “would not be involved in this project,” according to a senior vice president. And incredibly, the company maintains Lawrence Downs wouldn't suffer competitively from another racetrack and casino it's building just 20 miles away, in Youngstown, Ohio — or from Washington County's Meadows “racino” (built without public money) and Erie, Pittsburgh and Nemacolin Woodlands casinos.
“It's a pretty speculative project given that there is such a cluster of casinos already in the region,” says a Fitch Ratings analyst. Yet, incredibly, backers project 2 million annual visitors.
Lawrence Downs has its harness-racing license. But for all these reasons, the Gaming Control Board should reject its casino-license application. It's a crapshoot that's a bad bet.
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