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Indiana State Bars Casino Payments

Payments of a casino to a private company amounting to millions of dollars was blocked by Indiana State Gambling regulators. The decision was meted out even though a judge has made a previous ruling that the contract asking for the payments was valid.

The commission said that the local agreement that had collected more than $16 million from casino operators since 1997 to East Chicago Second Century Inc. violated regulations and the intent of state law. The Indiana Gaming Commission stated this when it came in the scene two weeks ago.

The Indiana Gaming Commission upon intercepting the dealings said that the local agreement that had steered more than $16 million from casino operators since 1997 to East Chicago Second Century Inc. violated regulations and the intent of state law.

Although a Marion County judge ruled on Wednesday in favor of Second Century in a lawsuit filed against it by current East Chicago officials the decision of the commission is still final, said Ernest Yelton executive director of the commission.

This week, East Chicago Second Century Inc. filed a lawsuit against the gaming commission, claiming that the commission does not have within its authority the right to terminate the casino payments. Second Century's attorney J. Lee McNeely said June 22 that the termination of the payments was groundless and that Second Century has been a major force in economic development in the city.

"The only legitimate charge against them is that they do not have the favor of the current city administration and its friends," McNeely said. Yelton refused to comment on the filed by second century against the gaming commission.

Resorts is East Chicago Second Century's operator at present. It has suggested placing 0.5 percent of the casino's gross revenue that Second Century has already received in an escrow account. "I think that's wise, considering there are now two lawsuits pending," Yelton remarked. The commission has agreed to consider the proposal on Sept. 14 when it will meet.

Similarly, The East Chicago Community Development Foundation and the Twin City Education Foundation were also subjects of the lawsuit filed by incumbent East Chicago Mayor George Pabey's administration. The dealings about the casino payments were negotiated and finalized under the administration of former mayor Robert Pastrick, who Pabey defeated on the 2004 elections. In the ruling on second century however, payments on the two foundations were not mentioned.

East Chicago city attorney Carmen Fernandez said the city has plans to appeal the lawsuit ruling. She added that Pabey wants to use the money from the local agreement for redevelopment projects along the city's waterfront.

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