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Missouri Mayor's Bet On Gambling Takes An Unexpected Toll Riverside Got Streets, Sewers, But Her Family Paid a Price

February 24, 2004

PAGE ONE

Missouri Mayor's Bet
On Gambling Takes
An Unexpected Toll
Riverside Got Streets, Sewers,
But Her Family Paid a Price

By CHRISTINA BINKLEY
Staff Reporter of THE WALL STREET JOURNAL

(See Corrections & Amplifications item below0.)

RIVERSIDE, Mo. -- One evening in 1993, town leaders weighed whether to welcome a riverboat casino to this blue-collar town on the outskirts of Kansas City. Mayor Betty Burch, a former Bible-school teacher, was the lone dissenter. "I had a moral problem with gambling," she says.

Within weeks, though, Mayor Burch changed her mind and was campaigning door to door for the casino, exerting the same power of persuasion that has earned her six terms in office.

Gambling taxes, she became convinced, could pave streets and build a sewer system in Riverside, a town of 3,000, where the air was often befouled by hundreds of backyard septic tanks. "I have always had a vision for Riverside," she says. "I just never knew how I was going to get it -- until the riverboat."

With her influence, a referendum allowing a casino passed handily. Argosy Gaming Co. outfitted a riverboat for gambling here. At the grand opening in 1994, Mayor Burch pulled the handle on one of the Kansas City region's first slot machines.

Since then, Riverside has received some $50 million in gambling revenue. Its aldermen meet in an elegant new city hall, next door to new recreation and public-works buildings. The streets are paved and a sewer system has been installed. With the help of casino funds, the town is completing a levee that will protect it from devastating floods of the Missouri River and developing an industrial park on formerly flood-prone land.

Advised by urban designers, $325-an-hour attorneys and $165-an-hour publicists, Ms. Burch has vaulted to new prominence. "Now when I go places, everybody knows who I am," says the 70-year-old great-grandmother who must stretch to reach 5 feet tall. "I'm treated like I'm very important."

Yet the mayor has paid an unanticipated price for all this. After the casino came to town, she says, her widowed sister began gambling -- eventually losing her three-bedroom, red-brick home of 25 years. Ms. Burch says two other family members may have gambling problems, and she worries about a retired friend who makes frequent morning visits to the casino.

Members of her family have chided Ms. Burch for letting lucre override her values. "Mom, you didn't raise us like that," her son Jim once told her. That "really hurt me," she says.

Community leaders across the U.S. are weighing the decision Mayor Burch faced a decade ago. When dealing with a budget crisis, elected officials often turn to casinos as a source of cash, regardless of their own attitude toward gambling. New York Mayor Michael Bloomberg, for instance, says he's personally opposed to gambling. But lately he has pressed for its legalization. So many residents drive to casinos in Connecticut and New Jersey, he asked in a radio address late last year, "Why not keep the money here?"

There is a casino proposed at the Mall of America in Minnesota and in the family-entertainment mecca of Branson, Mo. Legislators in Maryland, Pennsylvania, Texas and more than a dozen other states hope gambling will pull them out of financial binds.

In 1985, Las Vegas and Atlantic City had the only casinos in the U.S. But the economic recession of the early 1990s ushered in a wave of expansion. Today, 29 states have casinos, and three-quarters of the U.S. population lives within 300 miles of one. More people visited a casino in 2002 than attended a major-league baseball game.

People gamble more when they live near a casino. In Nevada, 43.7% of residents make an average of 22.8 trips to a casino per year -- the highest gambling rate in the nation, according to casino giant Harrah's Entertainment Inc. In South Carolina, where folks must travel out of state to find a casino, only 7.5% of the populace gambles, making an average of 2.1 trips to a casino each year.

Missouri officials have tried to curb addictive gambling by limiting patrons' losses to $500 every two hours, which casinos track electronically via a card that players put into machines. At 1 a.m. one weekday last fall, the Argosy riverboat in Riverside was hazy with smoke, its floors sticky and scattered with crumbs. Dozens of elderly women dressed in sweat suits and other comfortable clothes sat working the slots. A few wore a latex glove on one hand to stave off grime from hours of feeding coins and pressing slot buttons.

Mayor Burch and her sister Linda were raised Baptist in a Catholic neighborhood on the Kansas side of the river, along with seven brothers. Their parents told them that Catholics might gamble, Ms. Burch recalls, but Baptists didn't. Linda married a hair dresser and adopted two girls. Betty wed a local man named Mitch Burch, who soon bought a plot of land across the river in a small town called Riverside.

For decades, Riverside was known for cheap liquor, gas and cigarettes, but it never had a cohesive retail district. Instead, it had isolated landmarks such as the Red X -- a sprawling variety store that features the owner's collection of bells, a dead baby shark in formaldehyde and glass eyeballs. In the 1960s, construction of Interstate 635 bypassed the town completely. "It just cut Riverside right off," says Lucille Edwards, 83, a local business owner.

Betty Burch and her husband had three children and built a construction business. Ms. Burch taught Sunday school at the Riverside Baptist church. She worked for years as city clerk, then ran for mayor in 1988.

After Linda's husband died suddenly of a heart attack one Christmas day in the 1980s, she raised her two young daughters alone.

In 1992, Missouri passed a law allowing local voters to approve riverboat casinos. Soon afterward, former state Sen. Phil Snowden proposed a casino referendum to Riverside's leaders. If they didn't approve gambling, he told them, some other town would. "Unless you move quickly," he said, "you're not going to be able to be in the game."

Ed Rule, one of the aldermen there that night, recalls the idea was instantly attractive -- to everyone except the mayor. "Betty was against it for religious reasons," he says, "but the rest of us ne'er-do-wells were for it."

Concerned the town might be "getting in over its head," Mayor Burch spoke to civic leaders in Iowa, which had recently opened riverboat casinos. They told her about all the money they were making, she recalls, without any increase in crime. "They didn't have one negative thing to say about the boats," she says. Casino proponents told her state-funded programs would deal with the few people who might develop gambling problems. Soon, her misgivings were outweighed by the possibility of getting funds for fixing up Riverside.

As she campaigned for the casino, Ms. Burch overcame the qualms of others. "I was raised in the church, so I was against the Argosy when they first started talking about it," says Harold Wall, 76, a former baker who has lived in Riverside since it was incorporated in 1951. "But when I could see what we could do for the city, I voted for it."

Mr. Snowden, who proposed the idea, made "a nice profit," he says, by selling land he owned to Alton, Ill.-based Argosy for the casino. Yet he "didn't want to have any direct involvement in the gambling itself," he says, because he has "questions" about the morality of it. Instead, he bought more land across from the casino and built a Super 8 motel. Today, his white two-story hotel -- plastered with a large banner reading "Jacuzzis" -- caters largely to casino customers.

Once the Argosy casino opened, money started rolling in. Riverside's location along the highway that runs between metropolitan Kansas City and Kansas City International Airport now seemed like an asset, making it convenient for drivers to stop off and gamble. The town's annual income, which was $1.3 million before the casino, is currently boosted by about $6 million in gambling revenue a year. Its reputation began changing from the "armpit" of the region to a town with a future, says alderman Mr. Rule. "You know," he says, "it's amazing what money will do for you."

Mayor Burch began to cement her role as the most productive leader in Riverside history. The town bought a new hook-and-ladder fire truck. She lobbied the U.S. Army Corps of Engineers for a levee and began buying up lands for an industrial park. She hired urban planners to design a downtown.

When the federal government said Riverside was too small to merit its own post office, Mayor Burch used casino money to buy land and put up a tiny building to be used as a post office, leasing it back to the government for $1 a year. "A post office will give you some significance, I think," she says.

Mayor Burch's equanimity was shattered in 1999 when she received a phone call from her sister.

"She said she was in trouble and said she was going to lose the house -- she couldn't make the payments," the mayor says. Bill collectors were calling daily. "I was so shocked, I was crying.... Never in your life do you think that's going to happen in your family."

In 1997, Linda took out a $52,000 loan against her home, according to family members and court documents. After the phone call, Mayor Burch says she and one of her brothers confronted Linda, who, at the time, admitted she had a gambling problem. The mayor says she gave her sister a month's rent to find a new place to live and bought her a car -- a 1988 Chevrolet -- to drive to work.

The mayor's sister declined to be interviewed for this story. Her daughter Tracie Ruis says, "My mom doesn't have a gambling problem," but declined to elaborate.

In 1999, Household Finance Corp. filed foreclosure proceedings and obtained a court order to sell the house, which later sold for about $65,000, according to court records. Linda moved into a rented duplex with one of her daughters and her grandchildren. "Now she lives payday to payday," Mayor Burch says.

She has urged her sister to seek therapy, she says, but to no avail. Linda continues to gamble "whenever she scrapes together a little money," Mayor Burch says. She laments that a tribal-owned casino recently opened across from the Kansas City building where her 59-year-old sister works as a night janitor.

Within the Burch home -- a ranch house with a sunny family room overlooking the homes of their three children -- the situation has generated soul-searching. Some in the family believe the casino has brought benefits. The mayor's 17-year-old grandson works in the casino's sports bar until 1:30 a.m. several times a week, making money he hopes to use to buy a BMW. While Mitch Burch worries about a relative on his side of the family who has developed a gambling problem, he notes that after a tornado last May, Riverside's emergency crews "had the money to get out there and clean it up fast."

For the mayor's 51-year-old son, Jim, who works in the family construction business, that's scant justification. "Most of the people gambling down there come from families that can't afford it," he says. "There's plenty of other cities in the U.S. that survive without gambling."

His sister Kathy Rose, Riverside's clerk of the court, points out that Riverside residents enjoy no property tax. Without the casino, she says, "we would have been taxed." For her, the whole problem boils down to willpower. "Our philosophy in our family is that people have choices," she says.

By many estimates, at least 90% of revenue generated at casinos is garnered from less than 10% of patrons. That means a relatively small coterie of gamblers are actually paying for the improvements in Riverside. "We have a very loyal clientele," says Kendra Miner, the Argosy's director of sales and marketing.

Argosy says it trains its employees to identify characteristics of compulsive gamblers and refer likely candidates to a state-operated, toll-free help line. Under state law, it also helps fund programs to assist such gamblers, including one that allows people to sign binding legal documents banning themselves from Missouri casinos for life.

Al Boeding says he visits the Argosy casino, located less than a mile from his office, about twice a week, gambling tens of thousands of dollars a year. "You see the same people, day after day," he says.

"I got into trouble three years ago," says Mr. Boeding, who runs an aircraft-parts business. "I lost a ton of money. It was hard to control myself."

Although he didn't seek help, Mr. Boeding says he is gambling with more restraint these days. But he feels animosity toward the casinos he frequents. "I hate them," he says. "I think it's the worst thing that ever happened to Kansas City. They take a lot of discretionary income -- and not-so-discretionary income -- out of the community."

Ms. Burch says she expected the casino boom to last only a few years. But in December, she helped celebrate a $105 million expansion of the Argosy casino featuring 1,750 new "cashless" slot machines that can be played faster than traditional ones. Last month, the casino's gambling revenue rose 61%, compared with 10% for the Kansas City market as a whole.

"I have to separate my personal and my professional life," the mayor says. "I don't want the riverboat to go anywhere. When I look at what it's done for the city, I'm overwhelmed."

Write to Christina Binkley at christina.binkley@wsj.com1

Corrections & Amplifications:

Legal casino gambling was available in Nevada and Atlantic City, N.J., in 1985. The article above incorrectly stated that Las Vegas and Atlantic City had the only casinos in the U.S. at that time.
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