GARY, Ind. (April 24, 2016)–The May 3 Indiana presidential primary is putting renewed attention on Republican front-runner Donald Trump’s successful bid for a Gary casino two decades ago.
Trump was awarded one of two state licenses to build Lake Michigan casinos in the early 1990s. The Trump Casino later filed for bankruptcy and was taken over in 2005 by the Majestic Star, Gary’s other casino.
The real estate tycoon agreed to spend at least $8.5 million to help revitalize a shuttered 14-story downtown hotel as part of a local development agreement tied to his casino, civic leaders told The Indianapolis Star (indy.st/1SFzVV5 ). The city let him drop the deal after the building’s shoddy condition made redevelopment difficult. The dormant hotel was demolished in 2014.
“The way that thing was constructed didn’t offer a lot of flexibility in terms of what you can do with the basic structure,” said attorney Scott King, who was Gary’s mayor from 1995 to 2006.
A 2004 report by the Center for Urban Policy and the Environment at Indiana University found that Trump’s casino had contributed $75 million to Gary and $833,381 in sponsorships and contributions to community groups since its 1996 opening. Gary also twice hosted Trump’s Miss USA beauty pageant.
“Trump has been a positive addition to the community,” the report concluded, adding the casino “provides well-paying jobs with good benefits as well as economic diversity in a time when steel mill and manufacturing jobs are declining.”
Trump’s bid for one of the two Gary licenses after the state legalized riverboat gambling was actually rejected by the city in a nonbinding decision before the Indiana Gaming Commission endorsed his effort. The state commission chose cable TV mogul Don Barden of Detroit to operate a casino as part of a joint venture with Trump to redevelop an industrial site where their riverboat casinos would dock.
An early dispute over the price of the land they shared and casino management led the Gaming Commission to threaten to withhold their licenses.
Trump’s casino subsidiary, Trump Hotels & Casino Resorts Inc., filed for Chapter 11 bankruptcy in 2004, seeking to restructure $1.8 billion in debt. Trump, who also had been trying to open a new casino in French Lick, sold his stake in the Gary casino venture to Barden’s company for $253 million in November 2005.
The combined casinos, called Majestic Star Casinos, are Gary’s third-largest employer, with more than 1,000 workers.
Trump’s real estate company did not respond to requests for comment.