Wednesday, March 12, 1997 | 11:59 a.m.
With only one riverboat casino license remaining in Louisiana, two competitors in the fierce Texas border market of Shreveport-Bossier City hope to nab a second floating gambling hall - and perhaps gain a long-term competitive advantage.
Horseshoe Entertainment, which once thought it had won the fight, and Casino America are among five applicants for the 15th and final riverboat license allowed by state law.
Both want a second boat to put aside the floating casinos they already operate in Bossier City, part of the market that has consistently won the most money from gamblers since the casino era began in Louisiana in late 1993.
The Louisiana Gaming Control Board could award the license during a meeting scheduled for Thursday in Baton Rouge.
But no matter who wins among the five applicants, the 14 existing boats will profit the moment the final license is granted, an analyst says. With no more licenses to be had, a riverboat permit's market value will immediately jump.
"It's like anything else under supply and demand," said Larry Pearson, publisher of the Riverboat Gaming Report. "All of the existing properties will become more valuable. And I don't think there are going to be any more licenses legalized, at least during the near-term."
Horseshoe once was on track to nab the second boat, but was derailed when the Legislature overhauled the state's gambling regulatory system last year.
The now-defunct State Riverboat Gaming Commission approved Horseshoe for a second berth, but under a bifurcated regulatory process used then, Horseshoe did not finish the state police licensing process before the new control board was created.
The new board decided to start the process over.
Of the other three competitors, two also want to join the current four-casino foray in Shreveport-Bossier City: Louisiana Casino Cruises, which has an application for Shreveport, and Hollywood Casino, which wants to put in a riverboat in Bossier City.
Louisiana Casino Cruises, which is controlled by the Carnival Cruise Lines, owns Casino Rouge in Baton Rouge. Hollywood's partner is Eddie J. DeBartolo Jr., whose family owns the Louisiana Downs race track in Bossier City.
Shreveport-Bossier City typically leads the state's four riverboat markets with winnings from gamblers totalling around $40 million per month. However, industry analysts say the tally is unlikely to grow much until the casinos add major hotels to attract more than day-trippers.
All of the existing riverboats in the market either are building hotels or have them on the drawing boards. Horseshoe's 25-story hotel will be the first to open later this year. Hollywood and Louisiana Casino Cruises also plan hotels if they get the license.
"That will make a difference in who gets the revenue. Mississippi has proven that nothing expands the revenue quicker than a hotel. It is absolutely necessary for the Shreveport-Bossier market to make this happen," Pearson said.
And if Horseshoe or Casino America gets the license, the winner will have another competitive plus: the ability to double gambling space from the current one-boat limit of 30,000 square feet to 60,000 square feet.
"If the Horseshoe or Casino America wins a second license, they will have a tremendous advantage. You will be bigger, you will naturally attract more gamblers because of that and you can build a bigger hotel," Pearson said.
The fifth applicant, New Orleans Steamboat Co. would locate its casino in Chalmette, where Circus Circus once planned, then later abandoned a $100 million project after casino gambling in the New Orleans area failed to attract the swarms of tourist wagerers once expected.
If New Orleans Steamboat wins, the company will soon have less competition in the riverboat front in the New Orleans area. The Flamingo casino plans to move later this year to Shreveport, leaving the area with three boats.
Plans originally called for the Flamingo to join Harrah's riverboat and participate in a joint venture, but the Flamingo's primary owner, Hilton Hotels Corp., recently said a separate casino-hotel venture might be pursued in Shreveport.
Although the Flamingo's move has been approved by regulators, the gambling board has warned that a separate Hilton-led venture might require reconsideration.
Pearson said all of the license holders will have a more-valuable property should an operator wish to come into Louisiana. Given the mood of the current Legislature, it is doubtful that additional riverboats will be legalized over the next few years, he said.
"It's more likely that the Legislature would let the riverboats expand their gambling space, say to 40,000 square feet," Pearson said.
But anti-gambling lobbyist C.B. Forgotston said it is no guarantee that other casino operators will not push hard for additional licenses.
"People say the Legislature won't do that," Forgotson said. "I say 'What has the gambling interests lost before the Legislature so far?"'
However, the 15 license holders likely would lead the fight against additional riverboats, Forgotston said.
"There's no question that they want a monopoly," he said. "But the question is how much political power the current boats would have."
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