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Floating Target

A boat in a moat may bring gambling to Michigan City.

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By Ben Joravsky

As strange as it may sound, they're digging a hole near a creek in Michigan City and filling it with a boat that they'll call a floating casino.

Boosters say the boat in the hole will offer as authentic a navigational experience as any steamer that ever rolled along any river. They say it will be the greatest thing to hit Michigan City since the outlet mall.

"Blue Chip will bring in people from all over the area," said Joe McQuaid, a spokesman for Indiana Blue Chip, the company that will own and operate the casino. "It's going to be a big winner for Michigan City."

But environmentalists say it's a wacky Rube Goldberg scheme that may pollute pristine waterways that feed Lake Michigan. They've gone to court to halt the project until more environmental impact studies can be completed.

"We're saying slow down, let's not be hasty," said Tom Anderson, director of the Save the Dunes Council, the local environmental group leading the anti-Blue Chip charge. "We have to take the time to consider the consequences before we allow valuable water routes to be destroyed."

The casino would go on Trail Creek about a mile inland from Lake Michigan in Michigan City, which is roughly 60 miles east of Chicago on I-94. For many Chicagoans, northwest Indiana means little more than a summer house on the beach an easy drive from the big city. (Mayor Daley, among many other Chicagoans, owns vacation property near Michigan City.) In fact, Michigan City's not unlike Chicago's own southeast side. It's a town of about 33,000 people, many of them the sons and daughters of laborers from eastern Europe or the American south who were drawn by the promise of high-paying industrial jobs.

By the 1980s many of those factories had closed (the old Pullman factory was converted into the Lighthouse Place Outlet Mall). Though the town never bottomed out, leaders were always looking for ways to bring in money and jobs. "They saw gambling as the answer," said Anderson, who grew up in Michigan City. "In some ways, it's an easy way out."

By 1995 a blue-ribbon committee appointed by Michigan City's mayor had solicited and reviewed gambling proposals from several companies. The committee settled on Blue Chip's plan to put a boat casino on Trail Creek. It was, McQuaid proudly said, a wise choice. "We'll have about 34,000 square feet of gaming space, much more than any gambling boat in Illinois. We'll have a restaurant, a ballroom, a conference space, and about 1,300 electronic devices, 50 live game tables, including 39 blackjack tables and four tables for craps. It will cost $110 million and it's all private money. We've already expended $45 million with construction and acquisition of property--$15 million of that has been spent in Michigan City. That's hard cash those people wouldn't have had otherwise. No wonder we have so much support in the area."

With the support, however, came deep-rooted opposition that Blue Chip's backers apparently never anti-cipated. For one thing, there's a strong environmentalist community in Michigan City--a product of the long, hard struggle to protect the region's dunes--that's skeptical of any waterfront development.

As the environmentalists see it, the project strains common sense. Why put the boat in a creek that can barely contain it when all of Lake Michigan is so close by? "You have to visualize this to realize how absurd it seems," said Anderson. "They're building a channel that's about 1,200 feet long for a boat that's about 350 feet long. They have to build the boat in the channel because there's no way to get it there."

According to state law, floating casinos are supposed to do just that--float--and move from one spot to another. "But they're going to be in a body of water that's barely big enough to contain the boat," said Anderson. "The boat's not really going anywhere because it has nowhere to go. It's supposed to actually leave the dock and sail on water. But it's going to go back and forth in a man-made hole. This is not really a floating casino--it's a boat in a moat."

Some of the land around the proposed channel has been a burial ground for lead, zinc, and other toxic products. "There's an unregulated old dump within a half mile of Blue Chip," said Anderson. "It's a terrible contradiction. On one hand you have a dangerous mix of heavy metals and solvents and PCBs buried nearby. And on the other you have Trail Creek, one of Indiana's best salmon streams. It's a tremendous risk to dig up around there. You could easily bring the solvents into the creek."

Aside from the environmental concerns, there's uncertainty as to whether the casino will succeed. McQuaid says there's a huge market of gamblers ready to stream into town from Michigan. But if there is, how long will it last? What if Michigan opens its own casinos in the area? What if antigambling crusaders make greater inroads? At the moment, industry leaders freely advertise on television and radio, in newspapers, and on highway billboards. But if gambling ever becomes as socially unacceptable as cigarettes, that advertising might be made illegal. Then would Michigan City (or any other gambling town) be able to count on anything more than gambling addicts?

The Michigan City activists would have greater confidence in Blue Chip's assurances if they knew more about the company, which has remained something of a mystery. "We're not even sure who owns it or who the primary investors are," Anderson complained. "We don't know them, but they say they're coming into our town to change it forever."

Despite all the unanswered questions, the proposed casino rolls on toward a late-summer opening. Mayor Sheila Brillson (who has not returned phone calls) endorses it, the Indiana Department of Environmental Management has awarded the necessary permits, and excavation has begun.

"The Save the Dunes can best speak for themselves, but they have not been successful [at stopping the casino] mainly, I think, because there's no basis to their criticism," McQuaid said. "We had a meeting in January attended by federal, state, and county representatives. They were very satisfied with the project. The soil has been tested, water has been tested. We have no issues as far as we or the regulator agencies are concerned. So what's the problem? Don't let them tell you the boat won't move--the boat will move. It has to cruise because of the legislation, so it will cruise. We didn't place it on Lake Michigan because that would dislodge many of those pleasure crafts there. Also, the catalyst behind this site was economic growth. This specific area was initially going to be a large marina site. But in the late 80s the developer had financial problems--the bank took over and we purchased it from the bank. So it's a perfect mix--we're going where we're needed.

"The morality question of whether or not gaming is good or bad is a tough one, but ultimately it's an individual's choice. Certainly, you don't have to come to the gambling facility, or if you do come you don't have to gamble. You can just dine. I think what you have to do is look at the jobs we're creating. You have to consider the financial benefits and not always dwell on the moral issues."

As for who owns Blue Chip, McQuaid called it a company of 24 "main investors, outstanding individuals from Chicago, Indianapolis, and other places. It's a private investment group, not a huge gaming company from Nevada."

And what are the names of these investors? "I would not be able to name all 24 of them off the top of my head. So rather than leave one name out I'd just as soon not name anyone."

So far, city leaders show no sign of turning against Blue Chip, despite several provocative articles written about the project by Amanda Hess, an enterprising staff reporter for the News-Dispatch, the local paper. A few weeks ago she revealed that Blue Chip was planning to share only 0.5 percent of its gambling revenues with Michigan City, less than some officials had expected. (That's on top of a $3 head tax and a 5 percent tax on profits, moneys the city will share with other governmental bodies.) And last week she wrote that Blue Chip had constructed a storage building over a sewer line even though Michigan City officials had denied its request to do so. "If a repair of that sewer line is necessary it'll mean that building will have to be demolished," Hess quoted one city engineer as saying. In her latest coup, last weekend she reported the list of Blue Chip's investors. Over half the company is owned by the Flynn family, which is a major investor in Chicago's Waste Management Inc. She also reported that McQuaid, a former captain with the Illinois State Police, used to be the acting administrator of the Illinois Gaming Board.

The biggest threat to the project comes from Save the Dunes. Last week members Charlotte Read, Joan Wiseman, Sandra Henderson, and Anderson filed a legal challenge with the state against Blue Chip's building permit, on grounds that more research was needed to guarantee the project wouldn't contaminate Trail Creek and Lake Michigan. If they win, the project could be halted, no matter how much money has already been spent.

"I think officials were so eager to get this project on line they were willing to cut corners without proper concern for the lake or creek," said Anderson. "As Charlotte [Read] says, 'In Indiana forgiveness is easier to gain than permission.' I think this was one case where they plowed ahead with the notion that in the end we'd forgive them for any mess they made."

Art accompanying story in printed newspaper (not available in this archive): Photo of Tom Anderson by Lloyd DeGrane.

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