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Rod Smith

Asbestos Adds to Binion's Woes

29 January 2004

LAS VEGAS -- Asbestos materials lacing Binion's Horseshoe could further delay its sale and reopening as well as slow and add substantial costs to any renovation or redevelopment of the downtown property, sources said this week.

Asbestos is a mineral fiber that was widely used in pre-1980s construction as an insulation material in floor and ceiling tiles and walls. When any of the material's tiny fibers are released into the air, such as during renovation work, it can cause serious health problems. It is classified as a hazardous air pollutant that is regulated by federal and county public safety agencies.

University of Nevada, Las Vegas professor and casino industry expert Bill Thompson said the "asbestos contamination is a big monkey wrench" for Harrah's Entertainment and any plans to reopen the Horseshoe.

"It's very expensive and very time consuming. It'll be like a year to get it done," Thompson said.

The Horseshoe has been closed since Jan. 9, when deputy U.S. marshals armed with court orders seized about $1 million to satisfy a $2 million debt owed to the Southern Nevada Culinary and Bartenders Pension Trust Fund and the Hotel Employees and Restaurant Employees International Union Welfare Fund.

Harrah's President Gary Loveman announced on Jan. 23 that his company had reached an agreement to buy the Horseshoe from owner Becky Binion Behnen and said his first priority was getting the property reopened "as quickly as possible pending regulatory approvals."

No timetable has been set for reopening, renovating or demolishing the downtown landmark, but Harrah's spokesman David Strow said Wednesday his company is "unaware of any asbestos problem that will keep us from reopening in a timely fashion."

The company has declined to answer further questions since its due diligence for acquiring the property has not been completed.

However, government officials and business people familiar with asbestos problems agreed the material could cause problems.

Even if no renovations of the building are planned, Clark County Department of Air Quality Management compliance supervisor Gary Miller said any asbestos fibers escaping into the air at the hotel-casino will have to be stopped and removed before the property can be reopened.

And if a new owner plans to renovate or demolish the 52-year-old downtown landmark, the company will have to conduct a site survey to safely remove asbestos from the site, following complex county and Nevada Occupational Health and Safety Administration regulations, before reopening the property.

Kurt Goebel, vice president of Converse Consultants' environmental division, said any work that might disturb asbestos in the building will require potentially expensive abatement and remediation site work to control the material.

Environmental consultants agreed preparing the 367-room hotel-casino for renovation likely would take six months to a year and cost more than $1 million, depending on how the work is undertaken.

They said an abatement project prior to renovating the property could be done the fastest and with the least disruption if it is done on a floor-by-floor basis. A remediation project to clean up the whole site would be completed fastest -- and at the least cost -- if it was done before any reopening, consultants said.

If no asbestos is flaking into the air and no renovations or demolition is undertaken, the presence of the material, despite its hazardous nature, will not require an abatement and will not delay a reopening, said Tom Czehowski, chief administrative officer for state OSHA.

Lori Headrick, Las Vegas branch manager for Forensic Analytical, a mold, lead and asbestos consulting firm, said the extent of the Horseshoe's asbestos problem will affect the value of the property and will be determined in the due diligence process.

Since the announcement of the takeover, rumors have been flying that Harrah's, which was mainly interested in buying the brand name and the World Series of Poker, is looking for a another buyer or operator.

Environmental consultants said any asbestos abatement or remediation program will be the responsibility of the new owner.

Becky Behnen and her husband declined to comment on the extent of the asbestos contamination or any past plans to clean it up.

Remediation experts said the asbestos problem is typical of older casinos in downtown Las Vegas and on the Strip, especially in properties built before 1980.

Asbestos problems, such as those in the Horseshoe, are a disaster waiting to happen that the city, county and state are just ducking, they said.

"This town has a lot of hotels that are older and noncompliant, and the state is just looking the other way," Headrick said. "All it'd take is one worker's claim, but the state doesn't want to do anything about it. And (for operators) fines are less that the cleanups."