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Arnold M. Knightly

Construction: Harrah's executive resigns

5 December 2007

LAS VEGAS, Nevada -- Harrah's Entertainment's top construction executive will resign at the end of January, the gaming giant told its employees in a Nov. 30 company e-mail.

Kirk England, vice president of design and construction, will leave the company Jan. 31 after three years in his current position and eight years with the company to join his family in Colorado.

The resignation comes while the company is the focus of internal and external investigations into remodeling that was done without proper permits or inspections at Harrah's on the Strip and the Rio.

However, a company spokeswoman said his resignation does not have to do with the investigations.

England was scheduled to retire from the company in the fall and join his family in a house they bought earlier this year.

However, he was asked to remain in his position when the problems with the remodeling came to light.

"He was asked to remain on and be the liaison from the company to the county to resolve the matter," Harrah's spokeswoman Marybel Batjer said. "He extended himself at our request. He agreed at that time that he would work through the issues through the end of the year."

Harrah's is scheduled to go before state gaming regulators Wednesday and Dec. 20 to gain approval of its $17.1 billion buyout by Texas Pacific Group and Apollo Management.

Harrah's Entertainment was recently named in three complaints filed by Clark County with the Nevada State Contractors Board. It is unknown whether the problems with room renovations will be discussed during the hearings.

Former Harrah's employees who have talked to the Review-Journal about construction problems at the company's hotels never mentioned England as being directly involved in or knowing of the problematic work.

Tom Adams, area director of design and construction for Harrah's subsidiary Roman Empire Development, and Mike Nasby, vice president of facilities and construction services, now work under England but it is unclear whether they answered to him when the problems occurred.

While it is not publicly known how much England knew about the renovations, the company has made a procedural change to make sure his successor is kept better informed.

Harrah's Entertainment has created a "project clearinghouse" process that requires the design and construction department to review and approve all contracting and remodeling work.

"This department will approve all engineering and design decisions, and verify that all work is properly permitted," Senior Vice President Jan Jones said in a statement Monday.

During the past year, England has been involved in the $1 billion expansion of Caesars Palace and construction of the $704 million Margaritaville Casino & Resort in Biloxi, Miss., as well as the design and planning of other projects.

The county's complaints against Harrah's allege that the company performed construction work without permits at the two properties and a warehouse building on Twain Avenue.

The company has hired the Los Angeles-based law firm Gibson, Dunn & Crutcher to investigate events related to the remodeling projects.

The county hired Kessler International, a New York-based audit firm, to investigate the county's response to a whistle-blower's complaints about possible safety hazards resulting from construction work at the two properties.

In early 2007, the county cleared the Rio of alleged remodeling without permits or inspection after a superficial one-day review. After the Review-Journal researched allegations from whistle-blower Fred Frazzetta, the county reopened its investigation in September.

That second inspection led to the closing of 140 rooms at the Rio, then nearly 600 rooms or suites at Harrah's.

Kessler International met with Jeremiah Carroll, the county's audit department director, on Monday. Additional interviews with other county officials are expected this week.

The length of the investigation isn't set and will depend on what the investigation uncovers, county spokeswoman Stacey Welling said

Most of the rooms at Harrah's have been reopened while 87 of the rooms at the Rio have been cleared for occupation.

Construction: Harrah's executive resigns is republished from