By Patrick Crowley
The Cincinnati Enquirer

COVINGTON - Developer Bill Butler has begun circulating his concept for bringing casino gambling to Northern Kentucky among the lawmakers who will ultimately decide the plan's fate.

Some Northern Kentucky lawmakers have confirmed receiving a copy of a position paper on casino gambling drafted by Mr. Butler, the president and CEO of Corporex Cos., a Covington-based developer of office buildings, country clubs, industrial space, hotels and upscale condominiums and apartments.

A spokeswoman said Monday that Mr. Butler would not comment on the plan, which mentions that "Corporex intends to take an active interest in the legislative process surrounding gambling."

"The current Kentucky state budget shortfalls have given rise to a strong push by the gaming advocates for land-based casino enterprises," Mr. Butler says in the position paper. "A probability that legislation will come forward in the near term is a reality."

But Mr. Butler's caveat that as much as one-third of profits from a Northern Kentucky casino be allocated to local governments and social service programs in Boone, Kenton and Campbell County is a high bar to meet. It will make if difficult if not impossible to pass the bill in Frankfort, area lawmakers said.

"I like the idea of the money being returned to the area," said state Rep. Jon Draud, R-Crestview Hills, one of the few Northern Kentucky lawmakers who has said gambling is needed to help deal with the state's $500 million budget shortfall.

"And social services never have enough money for all they need to do, either here or in the rest of the state," Mr. Draud said. "But I just don't know how practical the idea is. It will be hard enough to get gambling passed in Frankfort without keying in on one area. Politically, I just don't know if that will sell."

The plan will also have to overcome the idea that Northern Kentucky is rich. As lawmakers go to Frankfort to seek a gambling panacea to the state's budget woes, they hail from 120 counties, few with the monetary wealth on paper of Northern Kentucky.

Boone County, with a $53,593 median household income in 2000, is near the top of all counties, and $20,000 more than the state's average median household income of $33,672. Kenton and Campbell counties also have median household incomes above the state average, though poverty and homelessness exist in all three Northern Kentucky counties.

Mr. Butler said he has researched the casino gaming issue, including polling Northern Kentucky residents on the issue. Specifics about the polls are not included in the position paper other than claims that a "majority of respondents" support casino gambling.

Mr. Butler said Kentucky lawmakers have, with Corporex's help, the opportunity to draft gaming legislation that would do more to financially reward the state and local communities than in other states where gambling is legal.

But the specifics of the plan are yet to be outlined.

"Corporex believes that the way gaming is structured in other locations is the wrong model for Kentucky because extraordinary profits are taken out of the community by private operators," Mr. Butler said.

"Riverboat gambling in the Midwest has rewarded the operators with windfall profits, but has not resulted in commensurate development or capital investment into communities it draws upon."

To that end, Mr. Butler proposes that a "large portion of the profits should flow to community re-investment and provide high-quality social programs."

Mr. Butler has long been a public and financial proponent of a one-stop center in downtown Covington to help get the city's homeless on their feet.

The "Life Center" as it is called, has been stalled as sites have been deemed inappropriate and blocked by City Commission zoning votes.

"Legislation which enables gaming should be written to ensure that not less than one-third of the actual cash profits should be captured for the local community," he said.

"In this case, this is the whole Northern Kentucky sector, not just one city. These funds should be captured in a quasi-government/private sector vehicle or foundation in order to ensure their efficient distribution and use for the originally conceived goals and ideas."

The horse racing industry, which has pushed for legalized gambling, wants to build casinos at Turfway Park and other thoroughbred tracks around the state to compete with riverboat gambling in Indiana and Illinois and with racetrack casinos in states such as West Virginia.

A bill filed this year with the Kentucky General Assembly that would have allowed the tracks to offer video gambling died without a vote.

Lawmakers convene in Frankfort in January for the 2003 legislative session. Mr. Butler's plan and others being discussed around the state indicate that the legislature may skip the video slots or riverboat gambling options altogether and go straight for land-based casinos.

The horse racing lobby wants to be sure that, one way or the other, it is in the starting gate on expanded gambling in Kentucky. That could mean provisions to reserve a certain number of casino licenses for tracks or support the state's signature industry otherwise through gambling.

Mr. Butler said that under his plan, money would be earmarked for the racing industry.

House Majority Caucus Chairman Jim Callahan, D-Wilder, drafted the 2002 video slots at racetracks bill and said he would likely be involved in putting together legislation for the 2003 session that would legalize casino gambling.

Mr. Callahan said he is not sure what form the bill would take, whether it would call for land-based casinos, casinos at the tracks or a combination of both. And while Mr. Callahan said he appreciates and respects Mr. Butler's position on gaming, he is not sure it will pass muster in Frankfort.

"First off, I wish he would have discussed some of this first with us before letting it out in the media," Mr. Callahan said.

"And I'm not sure the way the plan is structured, with so much of the money dedicated to one part of the state, will ever win support of other regions. It's going to be a tough sell."

Rep. Tom Kerr, D-Taylor Mill, said he is not sure there is any support for gambling at all, no matter how it is couched or proposed.

"I read that the riverboats in Indiana make millions of dollars a month," he said. "And I realize that a lot of that money comes from Kentucky residents.

"But that's also money lost by Kentucky residents. And when you look at it that way, I'm not sure there is support for the proliferation of legalized gambling in Kentucky," said Mr. Kerr, regarded as one of the legislature's most conservative Democrats.

Developer Jerry Carroll, the president of the Kentucky Speedway in Gallatin County and the former owner of Turfway Park, had at one time discussed pursing a casino with Mr. Butler.

The two were granted approval by Covington City Commission to develop a plan for the last 10 acres of undeveloped Covington riverfront, known as Riverfront West.

But after news of Mr. Butler's plan first broke about 10 days ago, Mr. Carroll said Mr. Butler's plan was unworkable because it dictated how the money was to be allocated. Mr. Carroll said the decision would be made by lawmakers in Frankfort and any attempt to do otherwise would be futile and naive.

Mr. Carroll said he would also continue to push for legalized gambling, though neither he nor Mr. Butler have settled on a location for a casino.

Mr. Butler said the Riverfront West property - an open area of land between his Madison Place office and residential development and the Clay Wade Bailey Bridge - could be a suitable location for a casino along with other residential and retail development.

E-mail pcrowley@enquirer.com