Mar. 2, 2005 - "The Donald" is out of the French Lick casino project.

The announcement by the director of the Indiana Gaming Commission that Donald Trump won't build or run the casino rocked a meeting of the Springs Valley community's Historic Hotel Preservation Commission Wednesday morning in French Lick.

Commission chief Ernest Yelton dropped the bomb, saying negotiations with Trump Indiana Casino Management, LLC, to build and operate a riverboat casino -the so-called "boat in a moat" -- between French Lick and West Baden have ended.

He said the commission will expeditiously initiate proceedings to select a new casino builder and operator. But it will set back the timetable for the casino that Orange County residents voted almost 2-to-1 in favor of in 2003.

Gov. Mitch Daniels said in Indianapolis shortly after the announcement that he thought the decision was appropriate. And he made it clear he didn't think the Trump company was the best one for the project or Orange County.

"It's by mutual agreement and it is, I believe, the right outcome for all concerned," he said of the Trump withdrawal. "It's obviously a very good thing that our alert transition team suggested raising questions about this.

Whoever the right group is to carry that project forward in Orange County is not the Trump company in its current condition."

In a statement issued for him by Daniels' office, Yelton made clear the demise of the Trump venture was the ultimate result of a review initiated by Daniels in light of the Trump casino empire's financial problems and bankruptcy filing.

"One of my first directives from Gov. Daniels was to evaluate the status of this project and then respond with the appropriate action," Yelton stated.

"After consulting with my attorneys and advisors, I provided the Trump Casino representatives with terms and conditions for the operating agent's agreement which were designed to address the issues relating to the reorganization and to facilitate a meaningful discussion."

He said that in response to those conditions, Trump officials informed him Monday they had reassessed the company's ability and willingness to proceed with the project "at this time."

It cited in part a recent decision by the Indiana Tax Court that significantly increases its tax liability: $18 million it owes in back taxes for its Lake Michigan lakefront casino boat in downtown Gary.

"The financial prospects for a casino in French Lick have changed since we were awarded the project" in July 2004, company president Scott Butera said in a statement. "The tax burdens have become more onerous, and the proposition for additional gaming facilities in Indiana appears imminent."

That may have referred to a bill pending in the Legislature that would allow the state's cut from proposed pull-tab gambling as a partial funding source for a new retractable-dome stadium in Indianapolis for the Colts.

Yelton responded that "while I understand their position, the Orange County project cannot be delayed indefinitely. I will recommend that the Indiana Gaming Commission reinstitute a selection process for an operating agent.

"It is in the best interest of the citizens of Orange County specifically, and the citizens of Indiana in general, that this process will be conducted as fairly and quickly as possible," he said.

Yelton has already instructed his staff to begin implementing an expedited procedure for selecting a new licensee for the casino. He said the commission "is dedicated to assuring that the legislative directive that a riverboat be constructed in Orange County be promptly realized."

Plans call for building a "boat in a moat," a "riverboat" surrounded by a man-made lake between the French Lick Springs Resort and the West Baden Springs resort, the famous domed structure that Bloomington businessman and restorationist Bill Cook has been involved with.

After many years of trying, the 2003 Indiana General Assembly had approved transferring a moribund casino boat permit from Patoka Lake, where the Army Corps of Engineers would not allow it, to French Lick/West Baden.

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