Iowa gaming commissioners reject Riverside Casino’s bid to pause Linn County gambling license

Iowa’s Racing and Gaming Commission (IRGC) has unanimously denied a request by Riverside Casino & Golf Resort and its nonprofit affiliate, the Washington County Riverboat Foundation, to immediately pause the issuance of a gambling license for a new casino in Linn County.

The request, which was also filed in Iowa court last week, sought to delay approval of the $275 million Cedar Rapids casino and entertainment center. Riverside Casino argues that the IRGC lacked the legal authority to issue the license and disregarded its own regulations in granting approval for the project.

In its court filings, Riverside Casino contends that the commission acted unlawfully under Iowa Code § 99F.7 (11) and that the decision to issue the license was “unreasonable, arbitrary, capricious, and an abuse of discretion.”

The casino also questioned whether the 2021 Linn County gambling referendum, which allowed for a casino license, was valid, arguing that the language of the ballot measure was flawed since gambling had never previously been authorized in the county.

The IRGC previously declined to issue a declaratory order on the referendum’s validity, voting 4-1 on January 23 to reject Riverside Casino’s request. After the commission’s decision, Riverside sought judicial review in Washington County District Court and asked the IRGC to put the Linn County license approval on hold.

On Monday, the commission denied that request, maintaining that the dispute over the legality of the license should be resolved by the Iowa courts. Commission member Alan Ostergren, an attorney and former prosecutor, stated during the meeting that the matter was best left to judicial review.

“I don’t see that the challengers to the license … are deprived of their ability to go to the court for judicial review, if we deny a stay,” Ostergren said. He added that the court could issue a stay if necessary and that challengers would not be prevented from pursuing legal action.

Despite opposition from existing casino operators, the IRGC has supported the new Linn County casino, citing potential economic benefits such as job creation and increased tax revenue. The Marquette Advisors, a consulting firm, estimated that the Cedar Rapids casino would generate an additional $60 million in new gaming revenue annually for the state.

However, the study also projected that Riverside Casino could lose $34 million, or 26%, of its annual revenue by 2029 due to competition from the new casino.

In court filings, Karlyn Ollendick, Chief Financial Officer of Elite Casino Resorts, which owns Riverside Casino, stated that the anticipated revenue losses could force the casino to lay off at least 200 employees. Riverside Casino has asked the court to immediately halt all steps related to issuing the Linn County license, including construction activities on the Cedar Rapids casino.

Attorneys for Peninsula Pacific Entertainment (P2E), the casino developer, and the Iowa Racing and Gaming Commission filed motions urging the court to reject Riverside’s request for “ultra-expedited relief,” arguing that no emergency justified immediate legal intervention. In a court filing, Cedar Rapids Development Group, a subsidiary of P2E, stated that the legal challenge does not warrant an emergency stay.

“There is no ‘emergency’ present here nor any need for this Court to take ultra-expedited action on a stay request,” the filing reads. The attorneys also argued that while a groundbreaking ceremony was held for the project, the full construction process will take time, allowing for judicial review to proceed on a “reasonably prompt timeline.”

Riverside Casino’s attorney, Mark Weinhardt, defended the request for a stay, arguing that pausing the license issuance would not significantly disrupt the Cedar Rapids project. “A Linn County casino proposal has been in the works for a dozen years. A one or two-month stay to protect the status quo and determine the threshold legal question is a small ask in the overall scheme of this project,” Weinhardt wrote in court filings.

During a groundbreaking event for the Cedar Rapids casino on February 7, Brent Stevens, president of Peninsula Pacific Entertainment, told attendees to “mark their calendars” for New Year’s Eve 2026, the projected opening date of the new facility.