Group submits plan for southeast Kansas casino

TOPEKA, Kan. - A group that includes a former longtime Wichita mayor submitted a proposal Monday for a southeast Kansas casino, surprising state officials who had anticipated waiting until spring for a plan to emerge.

Ozark Trail Gaming LLC was the only prospective developer to file an application by Monday's deadline for a contract with the Kansas Lottery. The Wichita firm promises to invest about $225 million in a casino complex about one mile north of Interstate 44, near the Oklahoma border, in southeast Cherokee County.

The lottery hadn't seen any interest in a southeast Kansas casino since September 2008, when a developer selected to build and operate one, Penn National Gaming Inc., of Wyomissing, Pa., dropped its plans. Penn cited potential competition from a casino opened by the Quapaw Tribe just across the Oklahoma boarder in July 2008.

But former Wichita Mayor Bob Knight, an Ozark Trail principal, said his company believes a second casino would be profitable — and that two could draw enough gamblers and tourists to the area to benefit both casinos.

"It's viewed as a very, very difficult project," Knight acknowledged. "Some are looking at that as a glass half empty. Our view is that it's at least a glass half full."

Under Kansas law, the lottery would own the rights to the new gambling. The law gives lottery officials until Jan. 19 to negotiate a proposed contract with Ozark Trail. If the Lottery Commission approves one, a state casino review board will decide whether the project can go forward.

Before Monday, lottery officials said they hadn't heard of any serious interest in a southeast Kansas casino. Last week, the Lottery Commission even decided to extend the application period to as late as April 16 — if no proposals emerged by Monday's deadline.

"Nobody saw this coming," said Ed Van Petten, the lottery's executive director.

Knight said the group still hasn't determined whether it will build a hotel with its casino during the first phase of construction. He also declined to provide details about how the venture will be financed because, "We have substantial work to do."

"I'm convinced from my time in government that even the most intractable challenge has discernible solutions, if you get a chance to really work through it," Knight said. "We're hope-filled about this."

Van Petten said the group probably will have to borrow money for the first phase. Lottery officials said the casino would have 900 slot machines and 30 game tables.

Knight has been involved in unsuccessful casino proposals for the Dodge City and Wichita areas. Before the 2007 law allowing state-owned casinos, he was working with the Iowa Tribe of northeast Kansas to bring a casino to the Wichita area.

He served as Wichita's elected mayor from 1989-2003, except for 1992-95, when he was the state's commerce secretary. He also unsuccessfully sought the Republican nomination for governor in 2002.

Other investors in Ozark Trail are Wichita attorney Henry Blase, a trust that Blase oversees and Wichita investment banker Theron Froggatte.

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