Kansas awards casino contracts to Harrah’s, Penn

Kansas City (Reuters) – Kansas gaming officials have awarded two contracts for development of state-owned casinos as the first in a series of such projects the Kansas officials hope will ultimately bring in at least USD 200 million annually.

The Lottery Gaming Facility Review Board awarded 15-year contracts to privately held Harrah’s Entertainment Inc and Penn National Gaming Inc to construct and manage casinos that will be owned and operated by Kansas, the first U.S. state to do so.

The developers are to pay more than 20 percent of the casino revenues to the state.

Harrah’s is to develop its project in Sumner County in the south-central part of the state, while Penn’s project is slated for Cherokee County in the southeast.

Harrah’s will invest USD 560 million on the project and Penn is committed to spending USD 225 million, according to state officials.

Harrah’s was sued earlier this month by the Prairie Band Potawatomi Nation Indian tribe accusing the company of violating a noncompete agreement by seeking the state contract for a new casino.

Harrah’s said the suit was without merit.

The state gaming board will vote in September on who should receive two more contracts. The state legislature approved a law allowing for four state-owned casinos last year. The contracts are awarded based on which projects seem likely to bring the state the most revenue and help promote tourism.

Voters amended the state constitution 12 years ago to allow for a state-owned and operated lottery.