ChicagoClout

John Barr should keep that position, he is just as strict as Mikey, but alot more fair.

Investors in casino tied to Rosemont
October 31, 1999

BY CHUCK NEUBAUER AND ALEX RODRIGUEZ STAFF REPORTERS

The 59 investors who stand on the cusp of making millions from the proposed casino in Rosemont have seen a sure bet devolve into a question mark, now that a lawsuit filed by a rival venture stands in their way.

A Lake County riverboat group that claims the General Assembly fashioned legislation aimed solely at securing a Rosemont gaming license for Emerald Casino persuaded a judge last week to put the project temporarily on hold.

That judge will decide whether to extend that hold Monday. What happens after that will be watched closely by Emerald's investors, some of whom are tethered somehow to the O'Hare suburb and its clout-heavy mayor, Donald Stephens.

Those investors do business in--or with--the village or have ties with Rosemont through intermediaries such as former state Rep. Miguel Santiago, now a Rosemont lobbyist, or state Rep. Ralph Capparelli, a longtime Stephens friend whose work in the General Assembly helped secure the casino for Rosemont.

John Sisto is one example. The Park Ridge dentist is also the nephew of Capparelli, who in the past has repeatedly asserted he played no role in who was selected to invest in the Chicago area's newest maker of millionaires.

Like most Emerald investors, Sisto did not return phone calls from the Sun-Times. Reached at his home, Capparelli did not want to answer questions about Sisto and abruptly ended a phone interview.

While he says he doesn't know Sisto, Stephens acknowledged he knows people who ended up getting shares in the Emerald. However, he dismissed the notion that he somehow helped the those individuals get their stakes.

"I never went to [Emerald executives] Donald Flynn or Joe McQuaid and said, `This guy I would like to be an owner,' " Stephens said.

Asked about the cluster of Rosemont-connected investors on the list, Emerald Senior Vice President Joseph McQuaid said some of those investors got on the list because of their ties to some of Emerald's longtime investors--not because of any link to Rosemont.

"People called in--we interviewed them," McQuaid said. "If they seemed like decent people we offered them a chance to buy shares. I didn't ask who their aunts and uncles were or who they made political donations to."

Owners of the proposed Emerald Casino in Rosemont project $266.2 million in gaming revenue in their first full year of operation, according to documents released Tuesday. That would outpace the $256.3 million in gaming revenue generated last year by Elgin's Grand Victoria, the state's top-grossing casino.

For nine years, Stephens has been angling for the construction of a casino in Rosemont. But it wasn't until this summer that he amassed enough support in the General Assembly to win legislation that allowed a casino in Cook County.

The legislative compromise that paved the way for the new casino required its operators to set aside 16 percent of its shares for minorities and another 4 percent for women.

Emerald Casino Inc. has since added new investors and appears to have met those mandates.

So far, 12 shareholders who owned a stake in the company's failed Silver Eagle riverboat in East Dubuque, Ill., have decided to remain owners, though some had their shares diluted to make room for newcomers.

Most of Emerald's new investors did not return phone calls for comment. The few who did said they didn't need any middlemen or well-placed alliances to land a spot on the investor list.

All they did, they said, was pick up the phone and call Emerald.

"I just read about it," said Violeta Rodriguez, whose family owns a laundry and operated a video store on the Southwest Side. "I called HP [Emerald's former company name]."

However, insiders familiar with how Emerald's ownership list was assembled laughed at the idea that political allegiances and longtime friendships played no role in who was allowed to invest.

"That just didn't happen," said one insider when asked if all prospective investors had to do was call up Emerald and express their interest in investing.

Santiago, a former Democratic lawmaker from Chicago who was acquitted of ghost payrolling charges in January, is a lobbyist for Rosemont and helped assemble the votes needed to secure the Rosemont casino legislation this summer. He said he received a slew of calls from people asking about landing a stake in the casino.

One of those callers was Ernest Ojeda, who eventually was selected as an investor. Ojeda owns several McDonald's restaurant franchises in Chicago and is chairman of Pan American Bank, where Santiago is a shareholder.

"I've known him for 20 years," Santiago said. "He's a friend of mine, and he asked me about it. I told him here's what you have to do. Call up the company.

"My only involvement with this thing is I got a lot of calls and I referred the calls to the company," Santiago said, referring to Emerald.

Asked why he didn't invest in the casino himself, Santiago answered, "I'm just a poor, old broke legislator. If someone wants to lend me a million dollars I'd be more than happy to."

A trust associated with Sherri Boscarino is listed as an investor. She is married to Nick Boscarino, who until recently co-owned a cleaning company with Stephens' son, Mark. The company, Bomark, has cleaning contracts with the village-owned Rosemont Convention Center and Rosemont Horizon, now known as the Allstate Arena.

Stephens said he introduced Sherri Boscarino to McQuaid at one of his fund-raisers at his Wisconsin summer home this summer. But he insisted he wasn't pushing McQuaid to pick Boscarino as an investor.

"I really don't care who was an investor," Stephens said. "It doesn't make any difference to me. I didn't give a damn who was in it."

Other people who ended up on the investor list also showed up at the fund-raiser, Stephens said, and used the chance to sway McQuaid.

"I told McQuaid he was the most popular guy at the event, more popular than the governor," Stephens said.

Investor Susan Leonis works as a government consultant for Rosemont and has lobbied for the village, though she was not involved in the legislation that created the Cook County gaming license.

Also on the list is Kathryn Shannon, wife of Dan Shannon, a longtime friend of both Stephens and Donald Flynn's lawyer. A financial consultant and onetime head of the Chicago Park District, Dan Shannon introduced Emerald investor Maureen Flaherty to Emerald executives; Shannon is member of the board of directors at Total Travel, a Rosemont travel agency that Flaherty owns.

Capparelli's close friend and former business partner, Joseph C. Scarpelli, is listed as an investor. The pair were partners in a travel agency they sold a few years ago, and teamed up in three real estate deals since 1984. They also work out together at the village-owned health club in Rosemont.

Norwood Park Township Democratic Committeeman Robert Martwick, who has a quarter of a percent stake in Emerald, is president of Tempo International. Tempo reaped millions from its exclusive contract to promote pop music concerts at the Rosemont Horizon from when it opened in 1980 until this year. Tempo subcontracted the work out to Jam Productions and other promoters.

While Stephens and Martwick have known each other since the early 1980s, Stephens stressed that he and Martwick are not close friends, and that Martwick's appearance on the Emerald investor list "shocked and amazed" him.

Investor Edwin "Bud" Zeman, who owns several mobile home realty firms in Chicago and is a lobbyist, confers with Capparelli about mobile home legislation, Stephens said.

Zeman is treasurer of the Illinois Housing Institute PAC, a mobile-home political action committee, which together with his companies has contributed $27,500 to Capparelli over the last four years and $13,680 to Stephens since 1994. Stephens said he met Zeman at a Capparelli fund-raiser.

***

Gambling facility to be built on site of old industrial park

The Village of Rosemont has agreed to pay more than $15.6 million in the last 2 1/2 years to acquire the aging industrial park that makes up most of the site proposed for Cook County's first casino.

The bulk of the money--$12 million--has either been paid or is committed to partnerships made up of the Podolsky family, which developed the Rosemont-Chicago Industrial Park in the 1960s, and its business partners.

Rosemont has finalized deals totaling nearly $12.2 million since last May when state lawmakers passed legislation allowing Emerald Casino Inc., the operators of the Silver Eagle Casino, to move from East Dubuque to Rosemont.

Emerald will lease three acres from the village for its casino in a 35-acre site bounded by Bryn Mawr on the north, the Tri-State Tollway on the west, Balmoral on the south and a village parking garage on the east.

The village has acquired all the property in the site, said Rosemont attorney Peter Rosenthal.

The details of the land lease to HP will be worked out after the Illinois Gaming Board approves the casino. The Emerald will take up only part of the site with shops, restaurants and movie theaters among the features discussed for the remainder of the property.

An Emerald spokesman has indicated the gambling facility itself probably will be a barge in a moat, to qualify it as a "floating" casino

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Take Care and God Bless You and Your Family!

The big shot from Japan was 64 years old, Masatoshi Kitahara; Professor of HOSEI University Graduate School of Regional Policy Design, Personnel Management, Organization Design and CSR Management!