April 17 next casino foreclosure date Bally says Grand Station delinquent on $3M loan

Published 11:12 am Wednesday, March 28, 2012

April 17 is the next date on the courthouse steps for Bally Gaming Inc. and Grand Station Casino unless the casino pays the next installment of a $3 million loan the Nevada-based gaming equipment-maker says it is owed by Delta Investments and Development.

A legal notice appeared Tuesday outlining the most recent foreclosure notice on the debt, originally sought by the downtown casino to finance new equipment and future renovations.

A plan to lay off 211 workers starting today apparently is postponed pending the outcome of the parent firm’s financial situation. A call and an email to legal counsel who met with Mayor Paul Winfield and city attorney Lee Thames Friday were not returned.

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Delta’s license to operate the casino remains valid unless and until it receives an offer to buy out the remaining debt. The casino’s fate is intertwined with the City of Vicksburg because of a lease dating to 1993 involving 2.95 acres of the public boat launch area at City Front. Under the agreement, the city was to receive about $562,940 a year plus 1.5 percent of the casino’s net revenues until Oct. 13, 2033.

Termination fees of $450,000 would kick in if the casino closed. The lease has been honored by each of the casino’s three operators since it was built, but current back payments run in the hundreds of thousands, Winfield said.

A deal to sell Grand Station Hotel to a development company headed by New Orleans real estate developer Kenneth W. Bickford was announced March 15. Terms were not disclosed. Bickford plans to convert the hotel into a luxury condo and marina resort.

Harrah’s sold the casino and hotel to Columbia Sussex, which renamed it Horizon. Tropicana Entertainment, which was part of Columbia Sussex, took over the former Horizon’s operations and tried unsuccessfully to sell the casino in 2007. In 2010, Delta bought the casino for $3.25 million in cash plus liabilities, one of which is the lease with the city.