BATON ROUGE, LA (KPLC-TV) – Pinnacle Entertainment executives formally surrendered the license to the Sugarcane Bay Project to the Louisiana State Gaming Control Board on Tuesday.
Pinnacle President and Chief Executive Officer Anthony Sanfilippo testified before the board about why his company decided to scrap the project.
Sanfilippo said there were several reasons for Pinnacle's decision, including the troubled economy. Sanfilippo pointed to other major casino gaming projects that have been delayed or canceled across the country because of consumer spending. Sanfilippo pointed to Lake Charles falling revenue as evidence why the project was a risk.
Sanfilippo also said it was not a good idea to have two casino gaming operations next to each other, since one would be substantially busier than the other. Sanfilippo also said he was concerned about the real possibility of Texas legalizing gaming in the near future. According to Sanfilippo, if that were to happen, it would have a sizable impact on the Lake Charles gaming market.
Sanfilippo, who only became CEO of Pinnacle Entertainment last month, said his company would have to write off tens of millions of dollars it had invested in the project over the last three years.
Members of the Gaming Control Board wanted to know what had changed within the company's board of directors since December, when everything appeared to be on track for the project. Sanfilippo admitted the only thing that had changed was the CEO.
Almost immediately after becoming CEO, Sanfilippo said he expressed great concern about the Sugarcane Bay Project. Sanfilippo said Pinnacle Entertainment's investors did too. Last week, the final decision to scrap the project was made.
Sanfilippo refused to answer whether Pinnacle Entertainment would support another group possibly constructing a similar project on the property. He did, however, explain that he would be opposed to letting another entity build upon the work that Pinnacle has already invested millions of dollars into. He said he would have to meet with the Port of Lake Charles to talk about future projects, noting it would have to be something that benefits both PLC and Pinnacle Entertainment.
Sanfilippo reiterated his commitment to Lauberg du Lac and said he understood why some people in Lake Charles and Calcasieu Parish would be disappointed about Pinnacle Entertainment's decision, but he said he had to do what was financially best for the company.
COULD THE PROJECT STILL GO FORWARD?
Among those in the meeting Tuesday morning was Chester Jones with the Alliance for Local Recovery and Development. The Alliance had made a $77 million dollar offer for the riverboat license in 2006. That offer, however, was secondary to Pinnacle's deal with Harrah's.
Now that Pinnacle Entertainment has decided to cancel the Sugarcane Bay project, Jones said the Alliance for Local Recovery and Development would be contacting the state gaming control board to see what steps need to be taken to get the license Pinnacle Entertainment had just surrendered.
Meanwhile, Sanfilippo plans on meeting with Port of Lake Charles officials on Wednesday in Lake Charles.