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Trump Drops Plans for Orange County Casino

Donald Trump's casino company has dropped plans to build and operate a casino in southern Indiana's Orange County after a review ordered by Gov. Mitch Daniels on the company's viability to complete the project.

Ernest Yelton, executive director of the Indiana Gaming Commission, said Wednesday that negotiations had ended with Trump Hotels and Casino Resorts Inc. amid the review that began after Daniels took office in January.

Yelton said that Trump officials told him Monday that the company had decided against continuing with the project in French Lick, about 40 miles south of Bloomington. He said he had recently given the company conditions for it to meet in order to continue with the project.

Trump officials cited a recent state tax court decision that the company owed $18 million in back taxes for its casino along Lake Michigan in Gary and the potential expansion of gambling elsewhere in the state for its decision.

"The financial prospects for a casino in French Lick have changed since the time we were awarded the project," 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 eminent."

The move was a setback to residents who spent a decade lobbying for approval of the casino before winning permission from the Legislature in 2003. Casino supporters had touted it as a needed step for the area that during the 1920s was the playground of high-rolling movie stars but now consistently posts one of the state's highest unemployment rates.

"I don't like it at all," said Mary Gilliatt, 76, of neighboring West Baden who was wearing one of the orange T-shirts that identified supporters. "Trump was going to offer so much more. I am upset. I think he (Trump) could work everything out. He's got plenty of money and he's sure well known."

The state Gaming Commission in July selected Trump's company over two other groups that bid for the rights to the license for Indiana's 11th casino.

A contract between Trump and the state, however, had not been finalized, and doubts about whether the company could carry out its $108 million development plan had been raised since it filed for bankruptcy protection in November.

A Trump attorney said at the time of the bankruptcy filing that the company planned for the casino to open in early 2006.

Yelton said state officials would resume the search for a casino operator, but that no decisions had been made on a timeline or whether new groups would be allowed to submit bids.

"My goal is to have an executing operating agreement before the date the Trump representatives would have ever made up their mind whether or not to precede," he said.

Representatives of the two other bidders for the casino license _ one of which was a group that included Indiana Pacers President Larry Bird, a French Lick native _ said they were still interested in the project.

Lu Meis, managing partner of bidder Orange County Development, said Bird, a minority partner in the group, was still interested in the project.

"We are definitely interested," Meis said. "We are interviewing new partners."

Trump's Butera said the company planned to continue its "successful business relationship" with the state in operating its Gary casino, which opened in 1996.