Ex-governor hired to spur New Orleans casino approval

     Associated Press
      NEW ORLEANS -- Former Gov. Dave Treen, a longtime gambling opponent, is being paid at least $30,000 to push the Legislature to revive the New Orleans casino.
      Treen was hired in December as a consultant by the owners of $430 million in junk bonds in the project, which has languished in bankruptcy court for over two years.
      During his term from 1980 to 1984, Treen was anti-gambling. He opposed the state lottery, video poker and riverboat casinos, all of which were approved after he left office.
      But in a letter sent to legislators, Treen urges approval of a new contract between the state and Harrah's Jazz Co. -- a crucial step needed to pull the company out of bankruptcy and complete the casino building across from the French Quarter.
      The Associated Press obtained a copy of the letter.
      In a telephone interview last week, Treen said although he was being paid, that did not influence him to support the casino.
      "I don't do things I don't agree with," Treen said. "no matter what the inducement."
      Rudy Cerone, an attorney representing the bondholders, said Treen began working for the group in December. According to court documents, the contract is for a minimum of four months at $7,500 per month. The contract has been approved by U.S. Bankruptcy Judge T.M. Brahney III.
      Treen said he favored legislative approval because of the possible effect on bondholders and unsecured creditors if the project is rejected.
      Attorneys for Harrah's Jazz have said the company probably will be liquidated if the Legislature does not approve the contract during a special lawmaking session beginning in March.
      "(The issue) is not whether we approve or disapprove of gambling," Treen said in the letter, dated Jan. 20, "but whether obligations freely undertaken will be honored."
      Treen said the Legislature encouraged the sale of the bonds by approving the project and warned the public investment markets would react adversely to Louisiana if the contract is rejected.
      If the contract is approved, the bondholders will become majority owners of a new casino company and all unsecured creditors will be paid in full, according to a reorganization plan filed in bankruptcy court.
      The Legislature rejected a previous contract last June, partially because of concerns about how the casino's $100 million annual tax payment would be guaranteed against a second closure. Harrah's Entertainment Inc., the primary partner of Harrah's Jazz, is now guaranteeing the payment.
      Treen called the new contract "a better deal" for the state and New Orleans and pointed out that Orleans Parish voters overwhelmingly approved keeping the project alive in a November 1996 referendum.
      Treen said he was approached by Cerone after telling others "that while there were downsides to gambling, having gone as far as we had, it should not be turned back."
      He said he wrote the letter to legislators after he studied the contract and Harrah's tax guarantee.
      "We didn't have any representation at the Legislature last time," Cerone said. "We felt we needed someone to get our message to the legislators."