In what may be a first for the state, the Indiana Gaming Commission on Thursday opted against renewing the license for a company that had been selected to operate a casino in the state.
The IGC’s unanimous ruling against Lucy Luck Gaming LLC, which held the license for a casino in Vigo County, means the commission will once again put the license out for bid. That license for a land-based casino in the west central Indiana county an hour west of Indianapolis was first awarded to Spectacle Jack, a subsidiary of Spectacle Entertainment, in December 2019.
Spectacle Jack planned to own and operate a Hard Rock casino in Terre Haute.
The company was the lone bidder for the license, which became available through an expanded gaming bill passed by lawmakers earlier in the year. However, the project was fraught with problems and scandal shortly after receiving the license.
In January 2020, the IGC opened an investigation on Spectacle Entertainment after learning of a federal investigation that was connected to Spectacle executives who once led Centaur Gaming.
That investigation led to Spectacle Entertainment founder Rod Ratcliff to sell his stake in Spectacle Jack to Greg Gibson, a Terre Haute-based businessman and Spectacle co-founder. That company became Lucy Luck and continued plans to build a casino with Hard Rock International.
The IGC approved the transfer of the license in May 2020.
But the scandal that ultimately led to one Spectacle executive’s indictment and the ouster of Ratcliff, a long-time gaming executive in Indiana, was just one of the problems Lucy Luck faced.
IGC Executive Director Sara Gonso Tait told the commissioners that staff members interviewed candidates to serve on Lucy Luck’s executive team. The staff had suitability issues with one candidate, and another said they were not interested in working for the company.
In addition, Lucy Luck failed to provide information about who would hold $57 million in notes on the casino, funding that made up about a third of the casino’s costs.
Gibson had said the company had potential investors but the notes had not been sold. The company was working with five Indiana-based banks to finance the construction.
Commissioner Susan Williams interrupted Gibson’s explanation for why the company did not have everything in place and castigated him for the company not having everything in order.
I used to manage construction for the state of Indiana, and we were in the room long before the shovels,” Williams told Gibson. “This is critical in terms of the design and construction. You’ve got to have a team in place to get yourself ready to put the shovel in the ground.”
With the rejection, the commission will seek new applicants for the license within the next 90 days. Tait said Lucy Luck could still “remedy its shortcomings” and be eligible for renewal.
However, in a statement to the Terre Haute Tribune-Star, Gibson sounded as if that would not happen. He did say the community could take heart in that a casino will be built there.
“It truly saddens me to know that the Terre Haute license will be open for a bidding process amongst companies who will be interested in the project solely for monetary gain, and with companies who don’t know our community like Lucy Luck does,” Gibson said.
“For me, this project has always been about Terre Haute; it’s been about my home community. Terre Haute deserves this casino, and I wish it could be alongside Lucy Luck Gaming.”
Spectacle Entertainment, where Gibson serves as vice chairman, narrowly avoided a similar fate Thursday, when the IGC voted to table a decision on its license renewal. Spectacle holds the license for the recently opened Hard Rock Northern Indiana casino.
While similar issues persist with Spectacle in that it does not have a full management staff in place – and is still under investigation – one key difference is Hard Rock International has more of a presence in the Gary casino.
Hard Rock International COO Jon Lucas told the commission that the new casino reported gross gaming revenues that exceeded $20 million for its first 18 days.
“I think that in the short period of time, we’ve demonstrated our ability to successfully operate and comply with all regulatory and compliance issues and collaborate in a very successful way with the commission staff,” Lucas said.
Hard Rock not only serves as the managing partner for the Gary casino, it also owns a minority stake in the venture. Lucas said there have been talks with Spectacle about the Florida-based company owned by the Seminole Tribe taking on more corporate oversight into the venture.
The IGC voted to table a decision on the license for 30 days, and Commission Chair Michael McMains gave the parties a dire warning if Spectacle and Hard Rock cannot resolve the outstanding issues.
“We’re not able to act on this renewal today, but if we were forced to react today and act on this matter, I don’t think it would be a good outcome based on what we’ve heard from staff and the comments from the commissioners,” the chairman said.