Casino seeks bankruptcy protection

Owners of the historic Imperial Casino Hotel filed for U.S. Bankruptcy Court protection from creditors Monday in a bid to restructure its debt and survive until higher gaming limits and new games approved by voters take effect next summer.

The casino-hotel complex, which employs 55 people, will remain open.

Imperial Gaming Corp. filed the Chapter 11 petition because the company's gambling revenue has fallen 21 percent this year and was no longer enough to cover payments on its $5 million in debt, said Bob Brooker, president and general manager.

He attributed the decline to a statewide smoking ban extended to casinos on Jan. 1, a weak economy, higher gasoline prices and the opening of a large new casino in town.

"Cash flow is slow this time of year and we have been having trouble covering our debt," Brooker said. "We would have been able to get through one or two of these problems, but facing all four has been pretty difficult. Hopefully, things will get better sooner than July (when the higher limits and new games take effect), but this gives us time to get to that point when we can add the games, increase the limits and expand our hours."

Brooker said the company's largest creditors are First Community Bank, which holds the mortgage on the hotel and casino, and slot machine giant International Game Technology Corp.

He said the company's assets total between $8 million and $9 million.

Imperial's financial troubles are just the latest result of a declining gambling market in Cripple Creek, where gaming revenue has declined every month this year from the same month a year ago.

The Wild Horse Casino shut down Oct. 31 and laid off its 62 employees; its general manager said the casino couldn't remain open long enough for the higher betting limits and new games to arrive.

Cripple Creek casinos also have been hurt by a major new competitor - the $80 million Wildwood Casino opened May 31 at the entrance to the city.

The state's gaming industry is hoping passage of Amendment 50 will boost revenues by raising the state's betting limit from $5 to $100, allowing casinos to stay open 24 hours a day and add craps and roulette.

Most of the additional tax revenue from the changes goes to the state's community colleges. Cripple Creek voters still must approve the changes in a Dec. 16 election, and the changes would take effect in July.

Imperial Gaming also sought Bankruptcy Court protection from its creditors in 2000 to reduce its debt, which at that time totaled $13.2 million and exceeded its assets by more than $3 million. The company exited Chapter 11 protection in late 2001.
The Imperial Casino Hotel operates 178 slot machines, making it the smallest casino in Cripple Creek other than two tiny casinos owned by groups that operate them as part of much larger casino complexes.

Imperial Gaming bought the 27-room hotel and an adjacent gift shop for $5.5 million in 1992 and converted the two buildings into a casino.

The previous owners, Wayne and Dorothy Mackin, had made the hotel a popular stop for tourists by offering melodrama performances for more than 40 years.

The performances continued until the 1990s, and resumed a few years later in the city-owned Butte Opera House.
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Contact the writer: 636-0234 or wayneh@gazette.com