Penn National Gaming may halt casino in Kansas

“We wanted to show the county a courtesy and communicate with the county first,” said Schippers.

Penn was the only applicant for the southeast Kansas gambling zone- just a few miles west of Joplin, where the us$ 300 million, tribal-owned Downstream Casino in Oklahoma opened July 5. Cherokee County officials had endorsed Penn's project, and state officials formally approved the company's bid August 22.

The same day, however, the Kansas Lottery Gaming Facilities Review Board rejected Penn's second bid, for Sumner County south of Wichita, where three companies were vying for a deal to a manage a state-owned casino there.

State officials selected a group that included Harrah's Entertainment for that contract. Penn had pitched its “southern strategy” to state officials, making it clear the company wanted to operate in both the Southeast and South-central gambling zones, or none.

“We're clearly disappointed,” Schippers said at the time. “A Cherokee County casino on a stand-alone basis would be very difficult to justify, given the market conditions there … the competition across the street.”

Penn had earlier won state permission to phase in its mandatory minimum us$ 250 million capital investment over 12 years instead of up front. A formal announcement by Penn is expected as soon as today.