Kansas Penn Gaming - SE Zone - project overview
Kansas Penn Gaming - SE Zone - contract
Kansas Penn Gaming - SE Zone - artist renderings
Kansas Penn Gaming - SE Zone - Analyses by Richard Schuetz

DATE: May 5, 2008
CONTACT: Sally Lunsford (785) 296-5708, sally.lunsford@kslottery.net

Lottery Commission Approves Contract with Kansas Penn Gaming for Cherokee Co. Casino

TOPEKA, KAN. – By a vote of 5-to-0, the Kansas Lottery Commission today approved a contract with Kansas Penn Gaming, LLC (a wholly owned subsidiary of Penn National Gaming) to become a lottery gaming facility manager in Cherokee County in the Southeast Gaming Zone of Kansas. The contract will now be forwarded to the Lottery Gaming Facility Review Board for its consideration.

Senate Bill 66, the Kansas Expanded Lottery Act, mandates an investment of $225 million for a destination casino in the Southeast Zone. The contract approved today allows for an initial investment of $125 million by Kansas Penn Gaming, with an additional $100 million of investment to be phased in over 12 years. A one-time privilege fee of $25 million to the State will be due within 30 days.

Representatives of Kansas Penn Gaming told the Lottery Commission they expect the casino to be open in two years – in May 2010. The contract calls for the first phase of the development to include a casino, buffet, coffee shop, gift shop and entertainment lounge/bar. Penn National says amenities that may be added later include a hotel, a car museum, an event center, and additional gaming. The location of the casino would be on U.S. Highway 166/400, approximately one mile north of Interstate 44 in the southeastern corner of Cherokee County. The developer estimated that 510 employees would be hired the first year.

As far as the gaming itself, which will be owned and operated by the State, initial plans call for 900 machines and 30 tables in the casino. The State is to receive 22 percent of the gaming revenue, with Cherokee County receiving two percent and Crawford County (the other county in the gaming zone) receiving one percent.

Penn National is the sole applicant in the Southeast Zone. The Lottery Commission will hear presentations from developers seeking to become lottery gaming facility mangers in the other three gaming zones May 19-20 in Topeka.