Sep. 5, 2003 - Call it a long shot, but the owners of Caesars Palace -- one of the largest casino operations in the world -- are exploring the possibility of building a Las Vegas-style casino resort at the jackpot of all locations: the Mall of America.

"We have had some discussions with a number of people in Minnesota about the development of a Caesars-branded casino at the Mall of America," said Robert Stewart, a spokesman for Park Place Entertainment, the owners of major casinos in Las Vegas and Atlantic City.

Stewart said Thursday that Caesars' officials have discussed the idea with the mall's owners, and the owners declined comment on Thursday. Discussions are in the "very, very preliminary stages. I really don't want to overhype this. I don't want people to suggest that this is farther along than it is," Stewart said.

The proposal is a long shot. It would require approval from a governor and Legislature that have resisted expansion of gambling in Minnesota. And if state policymakers opted for expansion, the casino would have to compete with other interests for the right to run new gambling operations. State law now limits casinos to Minnesota's 11 Indian reservations.

"The early book would be long odds against it," said George Andersen, director of the Minnesota State Lottery. "But odds change."

The Simon Property Group owns the mall and also owns the Forum Shops, a mall at Caesars Palace in Las Vegas. The casino would be part of the mall's planned expansion on what are now parking lots north of the current shopping center, said Angie Wozniak, a lobbyist for Park Place Entertainment. The mall plans to double in size in the next five years.

It's not surprising that casino operators are interested in the mall.

"It's probably the most lucrative potential site on earth," said George Andersen, director of the Minnesota State Lottery. The mall attracts 35 million to 42 million visitors a year.

Park Place Entertainment, which is slated to change its name to Caesars Entertainment next week, is among the world's largest casino companies with $4.7 billion in annual revenues.

Its marquee casinos include Caesars Palace and Bally's in Las Vegas and Atlantic City, as well as the Flamingo and Paris in Las Vegas.

The company is also the largest casino operator in Mississippi.

Gambling companies like Park Place have been scouring the country for new opportunities created by state budget crises.

The gambling industry underwent a huge expansion in the early 1990s as states legalized casinos in order to shore up recession-weakened budgets. Still, despite the industry's efforts following the 2001 recession, it has largely come up empty-handed so far.

But Andersen said debates over large-scale expansions of gambling are heating up in states across the country. Gambling proceeds, a "non-tax revenue source," are attractive to cash-strapped state officials, he said.

More than 90 percent of Minnesotans gamble. "If it (a non-Indian casino) was put to a popular vote, I think the public would certainly favor it, depending on where the money was placed," Andersen said.

Senate Minority Leader Dick Day, R-Owatonna, said pressure is building from the "normal guy on the street" who would like to use casino revenue to finance schools, roads, sports stadiums and other public projects.

Momentum for casino expansion has been building for several years.

Bills to establish one or more state-owned casinos have been introduced several times since 1997. One came close to passing this year when the House approved a state-operated casino at Canterbury Park. But that measure died in the Senate.

Day, the Senate sponsor of the Canterbury casino bill, said he plans to revive that bill next year, and he expects two to four competing casino proposals to be offered.

Day said Park Place lobbyists told him their planned Mall of America casino would not preclude development of a "racino" at Canterbury.

He said he would not oppose the mall casino.

But he noted the Caesars plan would face big political hurdles.

The city of Bloomington objects to a casino at the mall, he said, as do the Indian casino operators, a powerful lobbying force.

"We oppose any expansion of gaming in Minnesota," said John McCarthy, executive director of the Minnesota Indian Gaming Association. "We believe we have enough gambling in the state."

If lawmakers approved a casino at the mall, McCarthy said, they would be hard pressed to reject slot machines in bars, restaurants and resorts across the state.

The Caesars proposal also faces legal obstacles. A privately operated, non-Indian casino would be unconstitutional, said Andersen, the state lottery director. But the constitution could be amended, or the state lottery could operate the games of chance in a privately owned casino. "It is very doable," he said.

Caesars spokesman Stewart declined to discuss the size of the project. But Andersen predicted that if it happens, it would be among the largest resort casinos in the nation, dwarfing Mystic Lake Casino in Prior Lake and all the Las Vegas casinos.

Bill Thompson, a professor of public administration and a gambling research specialist at the University of Nevada, Las Vegas, said a casino at the mall would have the potential to generate revenues of $500 million a year and create 3,000 to 4,000 new jobs. Andersen said that revenue projection is very conservative.

The owners probably would be willing to pay 20 to 30 percent of gross proceeds in taxes to the state, Thompson said. That would generate up to twice as much tax revenue as the Canterbury operation.

The resort could include at least a 1,000-room hotel and a theater for big-name entertainers, he said. "It must have an attraction other than slots that people will go out of their way to see," he said.

"It's the Las Vegas model," he said. Unlike Minnesota's 18 tribal casinos, which rely on "local players," the mall casino would advertise throughout the nation and world for tourists who would spend three or four nights and take in a wide range of shopping and entertainment offerings in the region.

"It could provide a very positive economic benefit for the entire metropolitan area and the state," Thompson said.

Staff writer Mike Hughlett contributed to this article.

-----To see more of the Saint Paul Pioneer Press, or to subscribe to the newspaper, go to http://www.twincities.com/mld/pioneerpress.

(c) 2003, Saint Paul Pioneer Press, Minn. Distributed by Knight Ridder/Tribune Business News. PPE, SPG,