ALTOONA, Iowa | The Iowa Racing and Gaming Commission gave its blessing Thursday to an agreement that extends the Argosy Sioux City's expiring riverfront lease for up to 30 months.
The Sioux City Council must still give final approval to the new contract at its Jan. 28 meeting. Just moments before the IRGC vote, Mayor Bob Scott came to the podium to inform the commission the city is still waiting for a final draft of the legal document from Argosy owner Penn National Gaming Co.
"I hope your action is subject to the council's Jan. 28 action and not require us to agree to this because you do," Scott told the five-member commission.
The document will be in the hands of the city attorney on Friday, as scheduled, said Carl Sottosanti, Penn's deputy general counsel, after the meeting.
The city and Penn struck a deal Dec. 12 aimed at keeping the gambling boat operating until a new land-based casino is ready to open.
The settlement, which ended months of often heated negotiations, averted the threat of the boat shutting down at the end of this month, putting more than 300 casino jobs in jeopardy.
"We do appreciate everybody working hard to get this done," commission Chairman Jeff Lamberti said.
Under the new deal, the lease initially would be extended for a year, through Jan. 28, 2014. Penn then would have the option to extend it for an additional 18 months.
Sottosanti told the IRGC the new agreement extends the lease "comfortably" into 2015.
The Racing and Gaming Commission would ultimately decide how much longer the Argosy's license would continue. By most estimates, it would take about 18 months to build an onshore casino facility, putting the estimated opening in the fall of 2014.
Under the current Argosy lease, the city collects 3 percent of the casino's adjusted gross revenue. For the most recent budget year, the city payment totaled $1.8 million, based on about $61 million in revenue.
The same financial terms would continue during the first 12 months of the lease extension. In the next 18-month period, the city would collect an extra $7,500 per month.
Penn and the city also agreed to "release each other from liability for past conduct." The language was added at the request of the city, which had pushed for some form of legal indemnity to protect local taxpayers in the event Penn later sued the city.
Because the riverfront land is in an urban renewal district, the city was required by law to advertise the property for at least 30 days, pushing the final approval to Jan. 28.