State of Iowa Direct Financial Assistance_IDED, Peninsula Gaming, LLCMasterpiece on the Mississippi
TO: The Honorable Mayor and City Council Members
FROM: Michael C. Van Milligen, City Manager
SUBJECT: State of Iowa Direct Financial Assistance Application for Peninsula
Gaming, LLC
DATE: March 8, 2010
Dubuque
held
AI-America City
I r
2007
Economic Development Director Dave Heiar recommends City Council approval of the
submission of a Direct Financial Assistance program application to the Iowa Department
of Economic Development in the amount of $50,000 on behalf of Peninsula Gaming,
LLC. The commitment of local matching funds was previously authorized in the amount
of $337,000, consisting of Peninsula Gaming, LLC's representative portion of TIF
rebates previously committed to Port of Dubuque Brewery, LLC, as part of the Brewery
redevelopment project.
Peninsula Gaming, LLC. has announced its intent to expand its operations in Dubuque
by relocating a portion of the corporate offices currently located in Las Vegas, Nevada.
The Company will be creating 10 new jobs as a part of this expansion process.
Peninsula Gaming, LLC, was formed in 2004 and is a holding company whose primary
assets are its equity interest in its wholly owned subsidiaries. The Company has
corporate offices located in both Dubuque, Iowa and Las Vegas, Nevada. The
Company is a wholly owned subsidiary of Peninsula Gaming Partners, LLC, a Delaware
Limited Liability Company. Peninsula is a casino entertainment holding company with
gaming operations in local markets in Iowa and Louisiana. Peninsula Gaming Partners
seeks to develop quality gaming operations in highly protected markets. Peninsula
currently has 20 employees in its Dubuque, Iowa Corporate office.
Peninsula's project includes construction of new space in the Dubuque Star Brewery.
They will be leasing on a long term basis an additional 5,000 square feet from Port of
Dubuque Adams, LLC.
I concur with the recommendation and respectfully request Mayor and City Council
approval.
MCVM:jh
Attachment
cc: Barry Lindahl, City Attorney
Cindy Steinhauser, Assistant City Manager
David Heiar, Economic Development Director
Michael C. Van Milligen
Masterpiece on the Mississippi
Dubuque
kittd
AN- AmedcaCity
lip!
2007
TO: Michael Van Milligen, City Manager
FROM: David Heiar, Economic Development Director
SUBJECT: State of Iowa Direct Financial Assistance Application for Peninsula
Gaming, LLC.
DATE: February 23, 2010
INTRODUCTION
This memorandum presents for City Council review and approval a resolution authorizing
the submission of a Direct Financial Assistance program application to the Iowa Department
of Economic Development (IDED) on behalf of Peninsula Gaming, LLC., a corporate
headquarters located in Dubuque. The application is attached.
BACKGROUND
Peninsula Gaming, LLC. has announced its intent to expand its operations in Dubuque by
relocating a portion of the corporate offices currently located in Las Vegas, Nevada. The
Company will be creating 10 new jobs as a part of this expansion process.
Peninsula Gaming, LLC, was formed in 2004 and is a holding company whose primary
assets are its equity interest in its wholly owned subsidiaries. The Company has
corporate offices located in both Dubuque, Iowa and Las Vegas, Nevada. The
Company is a wholly owned subsidiary of Peninsula Gaming Partners, LLC, a Delaware
Limited Liability Company. Peninsula is a casino entertainment holding company with
gaming operations in local markets in Iowa and Louisiana. Peninsula Gaming Partners
seeks to develop quality gaming operations in highly protected markets. Peninsula
currently has 20 employees in its Dubuque, Iowa Corporate office.
Peninsula's project includes construction of new space in the Dubuque Star Brewery.
They will be leasing on a long term basis an additional 5,000 square feet from Port of
Dubuque Adams, LLC.
The financial assistance application on behalf of the company will provide financial
assistance to enable the company's expansion in Dubuque. As required by the incentive
program, the application requires a commitment of City funds to the project.
Peninsula Gaming has an office located in Las Vegas, NV. Corporate casino talent is more
readily available in Las Vegas and the surrounding areas and therefore it would be less
costly for the company if the corporate offices moved to Las Vegas and hired the new
positions for the Las Vegas office.
However, it is Peninsula's desire to maintain the corporate offices in Dubuque, Iowa, and
hire Iowans as well as relocated talent from the Las Vegas area to Dubuque, Iowa keeping
current and future staff and their families in Iowa. The available incentives that the
City /State are offering would help counter /off -set some of the expenses the company will
incur for relocating corporate employees to its Dubuque location.
DISCUSSION
Peninsula will commit to employ 10 new employees averaging over $83,000 per year plus
benefits. The Company will be investing approximately $218,000 in construction, computer
equipment, and furniture and fixtures.
To assist this project, Peninsula Gaming, LLC has requested financial assistance from the
State of Iowa in the amount of $50,000. City assistance as public match for the application
is required, and is proposed to amount to $337,000, consisting of Peninsula Gaming, LLC's
representative portion of TIF rebates previously committed to Port of Dubuque Brewery,
LLC as part of the Brewery redevelopment project.
RECOMMENDATION
I recommend that the City Council authorize the submission of a financial assistance
application for $50,000 on behalf of Peninsula Gaming, LLC. the commitment of local
matching funds was previously authorized.
This project is consistent with the City's goals to help local businesses expand in the
community, increase the number of good paying jobs and further diversify our economic
base.
ACTION STEP
The action step for the City Council is to adopt the attached resolution.
attachments
F: \USERS \Eton Dev\Diamond Jo \100% Component\ DED app memo.doc
RESOLUTION NO. 87-10
A RESOLUTION AUTHORIZING THE FILING OF A FINANCIAL
ASSISTANCE APPLICATION TO THE IOWA DEPARTMENT OF
ECONOMIC DEVELOPMENT ON BEHALF OF PENINSULA GAMING,
LLC.
Whereas, Peninsula Gaming, LLC. has proposed the expansion of its corporate
offices in Dubuque, Iowa; and
Whereas, the City Council of Dubuque, Iowa has considered said proposal and
has determined that the proposed project will contribute to the local economy through
the creation of 10 new jobs; and
Whereas, the Iowa Department of Economic Development (IDED) has a 100%
Component program designed to assist in the economic development efforts of local
jurisdictions; and
Whereas, the City of Dubuque, Iowa is eligible to apply for funding from the Direct
Financial Assistance program.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
DUBUQUE, IOWA:
Section 1. That the filing of an application for Direct Financial Assistance on
behalf of Peninsula Gaming, LLC. is hereby approved.
Section 2. That the local match of identified in the application as $337,000
consisting of Peninsula Gaming, LLC's representative portion of TIF rebates to Port of
Dubuque Brewery, LLC for increased building valuation has previously been approved in
the Development Agreement with Port of Dubuque Brewery, LLC.
Section 3. That the Mayor is hereby authorized to execute and the City Manager is
hereby directed to submit said application to the Iowa Department of Economic
Development together with such documents as may be required.
Passed, approved, and adopted this 15 day of M /ch, 2010.
Att s
Roy D.,uol, Mayor
eanne Schneider, City Clerk
F: \USERS \Econ Dev \Diamond Jo \100% Component \Resolution approving IDED app.doc
IOWA
/r / <, 1 changing'
Fred S. Hubbell, Interim Director
Iowa Department of Economic Development
Business Financial Assistance
Application
Business Finance
Business Development Division
Iowa Department of Economic Development
200 East Grand Avenue
Des Moines, Iowa 50309 -1819
www.iowalifechanging.com
Telephone: 515.725.3133
business finance @iowalifechanging. com
Application Instructions
To Complete Electronic Form: Click on TEXT BOX to add text. Double click on YES /NO boxes and select "Checked ".
1. All applicants must complete the Business Financial Assistance Application and attach only those additional sections
for the components to which the applicant is applying.
Direct Financial Assistance — STATE of IOWA
❑ 130% Component
(no supplement)
100% Component
(no supplement)
❑ Entrepreneurial Component (and Supplement)
Supplemental information required
Tax Credits — STATE of IOWA
❑ Enterprise Zone Program (EZ)
Supplemental information required
Direct Financial Assistance — FEDERAL,
❑ Economic Development Set -Aside Program (EDSA)
Supplemental information required
❑ Infrastructure Component
(no supplement)
❑ Value - Added Agriculture Component
Supplemental information required
Disaster Relief Component
Supplemental information required
❑ I ligh Quality Jobs Program (HQ)
(no supplement)
❑ Public Faclities Set - Aside Program (PFSA)
Supplemental information required
2. Please visit the IDED Web site at www.iowalifechangging.com or contact IDED at 515.725.3133 to confirm that this is
the most current application version.
3. Before filling out this application form, please read all applicable sections of the 2009 Iowa Code and Iowa
Administrative Code ( rules). www .legis.state.ia.us /IowaLaw.html
4. Only typed or computer - generated applications will be accepted and reviewed. Any material change to the format,
questions, or wording of questions presented in this application will render the application invalid and it will not be
accepted.
5. Complete the applicable sections of the application fully. If questions are left unanswered or required attachments arc
not submitted, an explanation must be included.
6. Use clear and concise language. Attachments should only be used when requested or as supporting documentation.
7. Any inaccurate information of a significant nature may disqualify the application from consideration.
8. The following must be submitted to Business Finance at IDED in order to initiate the review process:
• One original, signed application form and all required attachments
• One electronic copy of the application form and all required attachments
Facsimile copies will not be accepted.
Business Finance
Iowa Department of Economic Development
200 East Grand Avenue
Des Moines, IA 50309 -1819
Applications are must be submitted to IDED Business Finance before 4:00pm on the fourth Monday of
the month.
Applications will be reviewed by the IDED Board on the third Thursday of the following month.
IDED — Business Financial Assistance Application
Telephone: 515.725.3133
businessfmance@dowalifechanging.com
v. 09.22.2009
2 v. 09.22.2009
Public Records Policies
Information Submitted to IDED. The Iowa Department of Economic Development (IDED) is subject to the Open
Records law (Iowa Code, Chapter 22). Treatment of information submitted to IDED in this application is governed by the
provisions of the Open Records law. AU public records are available for public inspection. Some public records are
considered confidential and will not be disclosed to the public unless ordered by a court, the lawful custodian of the record,
or by another person duly authorized to release the information.
Confidential Records. IDED automatically treats the following records as confidential and they are withheld from public
disclosure:
• Tax Records
• Quarterly Iowa Emplo_yer''s Contribution and Payroll Report prepared for the Iowa Workforce Development Department
• Payroll Registers
• Business Financial Statements and Projections
• Personal Financial Statements
Other information supplied to IDED as part of this application may be treated as confidential under Iowa Code section
22.7. Following are the classifications of records which are recognized as confidential under Iowa law and which are most
frequently applicable to business information submitted to IDED:
• Trade secrets [Iowa Code §22.7(3)]
• Reports to governmental agencies which, if released, would give advantage to competitors and serve no public purpose.
[Iowa Code §22.7(6)]
• Information on an industrial prospect with which the IDED is currently negotiating. [Iowa Code §22.7(8)]
• Communications not required by law, rule or regulation made to IDED by persons outside the government to the
extent that IDED could reasonably believe that those persons would be discouraged from making them to the
Department if they were made available for general public examination. [Iowa Code 522.7(18)1
Information supplied to IDED as part of this application that is material to the application and /or the state
program to which the applicant is applying including, but not limited to the number and type of jobs to be
created or retained, wages for those jobs, employee benefit information, and project budget, are considered open
records and will not be treated as confidential.
Additional Information Available. Copies of Iowa's Open Record law and IDED's administrative rules relating to public
records are available from the IDED upon request.
IDED — Business Financial Assistance Application
3 v. 09.22.2009
Applicant Information
Name of Business: Peninsula Gaming, LLC
Address: 600 Star Brewery Drive, Suite 110
City, State & Zip Code: Dubuque, IA 52001
Contact Person: Natalie Schramm Title: Chief Financial Officer
Phone: 563- 690 -4977
Federal ID Number: 20 - 0800583
NAICS Code for primary business operations:
US DOT Number:
Does the Business file a consolidated tax return under a different tax ID number?
❑ Yes ® No
If yes, please also provide that tax ID number:
Is the contact person listed above authorized to obligate the Business?
El Yes ❑No
If no, please provide the name and tide of a company officer authorized to obligate the Business:
If the application was prepared by someone other than the contact person listed above, please complete the following:
Name of Business: N/A
Address:
City, State & Zip Code:
Contact Person: Title:
Phone: Fax: Email:
Sponsor Information
Sponsor Organization: City of Dubuque, Iowa
Official Contact (e.g. Mayor, Chairperson, etc.): Roy Buol
Address: 50 West 13 Street
City, State & Zip Code: Dubuque, IA 52001
Phone: 563 - 589 -4110 Fax: 563 -589 -1733
Fax: 563 -690 -1394 Email: natalie.schramm@peninsulagaming.com
If IDED needs to contact the sponsor organization with questions, should we contact the person listed above?
❑ Yes ® No, please contact the following person:
Name: David J. Heiar Tide: Economic Development Director
Address: 50 West 13 Street
City, State & Zip Code: Dubuque, IA 52001
Phone: 563 - 589 - 4393 Fax: 563 - 589 - 1733 Email: Dheiar @cityofdubuque.org
If necessary, please list information on additional sponsors in an attachment.
IDED — Business Financial Assistance Application
Tide: Mayor
Email: rdbuol @cityofdubuque.org
4 v. 09.22.2009
Certification & Release of Information
I hereby give permission to the Iowa Department of Economic Development (IDED) to research the Business' history,
make credit checks, contact the Business' financial institutions, insurance carriers, and perform other related activities
necessary for reasonable evaluation of this application. I also hereby authorize the Iowa Department of Revenue to provide
to IDED state tax information pertinent to the Business' state income tax, sales and use tax, and state tax credits claimed.
I understand that all information submitted to IDED related to this application is subject to Iowa's Open Record Law
(Iowa Code, Chapter 22).
I understand this application is subject to final approval by IDED and the Project may not be initiated until final approval is
secured.
I understand that IDED reserves the right to negotiate the financial assistance. Furthermore, I am aware that financial
assistance is not available until an agreement is executed within a reasonable time period following approval.
I hereby certify that all representations, warranties, or statements made or furnished to IDED in connection with this
application are true and correct in all material respect. I understand that it is a criminal violation under Iowa law to engage
in deception and knowingly make, or cause to be made, directly or indirectly, a false statement in writing for the purpose of
procuring economic development assistance from a state agency or subdivision.
For the B siness:
Signature Date
Natalie Schramm, Chief Financial Officer
Name and Title (typed or printed)
For the Sponsor(s):
Signature Date
Roy Buol, Mayor, City of Dubuque, Iowa
Name and Title (typed or printed)
Please use the_ following if more than one sponsor is required. or example, use this if a signature from the local Enterprise Zone Commission is
required in addition to the signature from the Mayor of the sponsoring city.)
Signature Date
Name and Title (typed or printed)
IDED will not provide assistance in situations where it is determined that any representation, warranty, or statement made
in connection with this application is incorrect, false, misleading or erroneous in any material respect. If assistance has
already been provided prior to discovery of the incorrect, false, or misleading representation, IDED may initiate legal action
to recover incentives and assistance awarded to the Business.
IDED — Business Financial Assistance Application 5 v. 09.22.2009
AMOUNT BUDGETED
Use of Funds
Cost
Source A
Source B
Source C
Source D
Source E
Source F
Source G
Land Acquisition
0
Supplemental Withholding
Source B: Other State
(Community College,
IDOT, etc.)
Site Preparation
0
10 -yr TIFF Rebate to Developer
Source C: Local Government
$
NICC
In -kind Contribution
Building Acquisition
0
TOTAL
$387,000
Source E: Other Private Sources
$168,000
Cash on hand
Building Construction
0
Source F:
$
Building Remodeling
150,000.00
TOTAL
$218,000
Mfg. Machinery & Equip.
0
Other Machinery & Equip.
0
Racking, Shelving. etc. 1
0
Computer I lardware
40,000.00
Computer Software
10,000.00
Furniture & Fixtures
15,000.00
Working Capital
0
Research & Development
0
Job Training
3,000.00
TOTAL
$218,000.00
$50,000.00
$
$
$168,000.00
$
$
PROPOSED FINANCING
Source of Funds
Amount
Form of Funds
Rate and
Term
Commitm
eat Status
Conditions /Additional
Information
(List tax benefits separately below, not as a
source of direct financing;)
(Loan, Grant, In - Kind,
Donation, etc.)
Include when funds will be disbursed;
If loan, whether payments arc a level
term, balloon, etc
Source A: IDED*
$ 50,000
Supplemental Withholding
Source B: Other State
(Community College,
IDOT, etc.)
Tax Increment Financing
$337,000
10 -yr TIFF Rebate to Developer
Source C: Local Government
$
NICC
In -kind Contribution
Source 1): Business
$
TOTAL
$387,000
Source E: Other Private Sources
$168,000
Cash on hand
Source F:
$
Source G: 1
$
TOTAL
$218,000
TAX CREDITS AND INDIRECT FINANCING
Source of Funds
Amount
Description
Investment Tax Credit
Sales, Service & Use Tax Refund
Doubled Research Activities Credit
Supplemental Withholding
Local Property Tax Exemption
Tax Increment Financing
$337,000
10 -yr TIFF Rebate to Developer
260E job Training Funds
$ 50,000
NICC
In -kind Contribution
Other
TOTAL
$387,000
Project Budget
Racking, shelving and conveyor equipment used in distribution center projects only
Does the Business plan to lease the facility? ® Yes ❑ No If yes, please provide the Annual Base Rent Payment (lease payment
minus property taxes, insurance, and operating /maintenance expenses) and the length of the lease agreement. Annual Base Rental is
$154,020. Lease is for 7 years with two 3 -year extension options.
* Identify the collateral used to secure IDED funds:
What measures were analyzed to determine the amount and form of assistance needed?
Is the Business actively considering locations outside of Iowa? ® Yes ❑ No
If yes, where and what assistance is being offered? 5055 West Patrick Lane, Las Vegas, NV 89118.
None.
IDED — Business Financial Assistance Application 7
v. 09.22.2009
There are three general justifiable reasons for assistance. Check the box next to the reason why assistance is needed to complete this
project.
❑ Financing Gap - The Business can only raise a portion of the debt and equity necessary to complete the project. A
gap between sources and uses exists and state and /or federal funds are needed to fill the gap.
❑ Rate of Return Gap — The Business can raise sufficient debt and equity to complete the project, but the returns are
inadequate to motivate an "economic person" to proceed with the project. Project risks outweigh the rewards.
® Location Disadvantage (Incentive) — The Business is deciding between a site in Iowa (site A) and a site in another
state (site B) for its project. The Business argues that the project will cost less at site B and will require a subsidy to equali ?e
costs in order to locate at site A. The objective here is to quantify the cost differential between site A and site B.
Peninsula Gaming has an office located in Las Vegas, NV. Corporate casino talent is more readily available in Las Vegas and
the surrounding areas and therefore it would be less costly for the company if the corporate offices moved to Las Vegas and
hired the new positions for the Las Vegas office. Las Vegas does not offer any incentives for business expansions.
However, it is Peninsula's desire to maintain the corporate offices in Dubuque, Iowa, and hire Iowans as well as relocated
talent from the Las Vegas area to Dubuque, Iowa keeping current and future staff and their families in Iowa. The available
incentives that the City /State are offering would help counter /off -set some of the expenses the company will incur for
relocating corporate employees to its Dubuque location.
IDED — Business Financial Assistance Application
8 v. 09.22.2009
Full RETAINED Jobs
(Add additional nows as needed)
Job Title
(Employee #)
Number of
RETAINED
Jobs
S Wage
Wage at End of
Year Three
1430
1
58,572.80
64,004.08
5213
1
44,990.40
49,162.22
5997
1
33,009.60
36,070.49
6076
1
37,502.40
40,979.88
5622
1
254,051.20
277,608.61
5901
1
53,268.80
57,643.13
6026
1
24,960.00
27,274.46
351
1
152,339.20
166,465.16
7080
1
95,472.00
104,324.83
5572
1
46,342.40
50,639.59
7667
1
86,528.00
94,551.49
8281
1
87,547.20
95,665.19
684
1
20,779.20
22,706.00
1019
1
37,398.40
40,866.24
6337
1
170,164.80
185,943.66
3711
1
33,155.20
36,229.59
5016
1
100, 006.40
109,279.69
5554
1
31,116.80
34,002.16
4
1
109,803.20
119,984.93
5880
1
22,880.00
25,001.59
5453
1
34,694.40
37,911.51
309
1
27,851.20
30,433.76
25
1
316,326.40
345,658.40
5072
1
47,070.40
51,435.10
1367
1
66,830.40
73,027.38
5110
1
522,953.60
571,445.52
5464
1
47,632.00
52,048.77
Full - Time CREATED Jobs
(Add additional rows as needed)
Job Title
Number of
CREATED
Jobs
Starting Wage
Wage at End of
year Three
VP Legal
1
200,000
218,000
VP Gaming
1
250,000
273,000
VP Advertising
1
100,000
109,000
Senior Art Director
2
50,000
54,000
Senior Web Designer
1
35,000
38,000
Graphic Artist
2
40,000
44,000
Web Programmer
1
30,000
33,000
Administrative Assistant
1
38,000
42,000
Total CREATED Jobs
10
Project Jobs
List the jobs that will be created and /or retained as the result of this project. (A retained job is an existing job that would be eliminated
or moved to another state if the project does not proceed in Iowa.) For jobs to be created, include the starting and final hourly wage
rate. For retained jobs, include the current hourly wage rate.
Is the hourly wage rate based on a 40 hour work week, 52 weeks per year? ® Yes ❑ No
If no please explain:
IDED — Business Financial Assistance Application
9 v. 09.22.2009
3330
1
40,809.60
44,593.76
5624
1
30,472.00
33,297.57
Total RETAINED Jobs
29
IDED — Business Financial Assistance Application 10
v. 09.22.2009
/O / )/
Attachment A3
State of Iowa
County of Dubuque
• °7 PENINSULA
GAMING, LLC
Affidavit
I, Natalie Schramm, depose and say that I have examined the following statement and have found
it to the best of my knowledge to be accurate and true.
Peninsula Gaming, LLC has not, within the last five years, violated state or federal statutes, rules,
and regulations, including environmental and worker safety regulations, or, if such violations have
occurred, that there were mitigating circumstances or such violations did not seriously affect public
health or safety or the environment.
I further depose that the signature below is my own proper signature.
Dated: 2/5/09
Subscribed and sworn to before me on
thi 5th da of - f ua 2010.
tL at J ' .I Notary Public)
buque County /State of Iowa
My commission expires on: 10/20/10
Natalie Schramm, CFO
Peninsula Gaming, LLC
600 Star Brewery Drive, Suite 110, Dubuque, IA 52001 I P: 563 - 690 - 4975 I F: 563 - 690 - 1394