EDITORIAL – All bets are off on Barden

The Pennsylvania Gaming Control Broad tried its luck in hiring Detroit-based casino executive… The Pennsylvania Gaming Control Broad tried its luck in hiring Detroit-based casino executive Don Barden as the contractor for Pittsburgh’s Majestic Star Casino. But clearly, the luck has run out.

Last week, Barden announced his plans to delay the construction of an outdoor amphitheater and other riverfront features at the North Shore casino. Barden had failed to acquire the $10 million needed to continue the construction, despite his announcement of having secured a $120 million investment from Walton Street Capital Fund 6, a private investment firm, as reported by the Pittsburgh Post-Gazette.

But this news should not come as a surprise. Barden’s other projects have not shown much success in the past. According to the Post-Gazette, Barden’s casinos in Indiana, Mississippi and Colorado have suffered great losses. Unfortunately, these financial woes seem to be making their way to Pittsburgh.

It is difficult to understand why the PGCB, along with Gov. Ed Rendell and Mayor Luke Ravenstahl, chose to award Barden with the casino license against other top companies in the first place. Even still, they are standing by their decision.

Rendell told the Post-Gazette, “Give Don Barden some credit. Notwithstanding a very terrible credit market for borrowing money, he has kept construction going almost unbroken.”

But the truth is that the city is now dependent upon an unreliable private contractor and is bending over backward to keep him. It is likely that, somewhere down the road, Barden’s plans will not pan out, and Pittsburgh will lose all hope for much-needed tax revenue.

The much bigger picture, however, is whether or not slot casinos are an effective source of revenue for the city of Pittsburgh. Instead of putting public trust into large slot casinos and undependable contractors, the city should look more toward the interests of local businesses.

Slot casinos are popular tourist destinations that are usually all-in-one resorts. For instance, according to its Web site, Pittsburgh’s Majestic Star Casino will include a steak house, an Italian restaurant, a deli snack bar and four casino bars and lounges. This means that guests rarely have to walk outside casino doors to stay entertained, causing the surrounding communities and businesses to suffer financially.

Bigger is not always better, and Pittsburgh’s grand plan for a slot casino did not have to be so grand. The city could have dispersed gambling into smaller, local venues. This way, Pittsburgh would depend upon local businesses that would have a real stake in the financial success of the city.

Or perhaps Pittsburgh should have chosen the more responsible option and tried to find other, more efficient sources of tax revenue. City officials would have done well to look toward other cities, such as Philadelphia, that have not had to rely on slot casinos to fund their cities.

Unfortunately, Pittsburgh has latched itself onto Barden and is unlikely to see the end of casino problems any time soon.