An Interview with Dale Burklund

Dale E. Burklund is president of Burklund Distributors, Inc., for years known as distributors of candy and tobacco products, with offices in East Peoria and Urbana, Illinois. He is also chairman of the Board of Directors of Greater Peoria Riverboat Corporation, owner of the Par-A-Dice Riverboat Casino. He and his wife, Shirley (Conner), have been married 47 years and have 4 children and 6 grandchildren.

The Burklund name has been around Peoria for a long time. Tell us about your background and the history of Burklund Distributors, Inc.

I was born and raised in Peoria and have been a lifelong Peorian. The company was formed in 1939 by my father and a gentleman by the name of Bob Springer. The company name was then Springer-Burklund. My father passed away in 1963, and in 1969 Bob Springer passed away; so the company became Burklund Distributors. We moved from Main Street to Hamilton and Water (now Hamilton and Constitution Avenue where the Caterpillar parking deck is), then to War Memorial Drive, then to Galena Road (next to Foster & Gallagher), and now we are here in East Peoria. We’ve had five moves in 54 years, and that’s enough for me. Any further moves will be up to my children.

We are distribution specialists to the convenience store industry. Our primary customer base is convenience stores and gas stations with convenience stores, to whom we supply nearly everything but bread, milk, and other perishables and gasoline. We sell much more today than just tobacco and candy, carrying more than 9,000 different items. We have 76 employees in Peoria and 52 in Urbana; and serve a geographical area from Beloit, Wisconsin to the southern tip of Illinois, and from Indianapolis to approximately 150 miles into Iowa.

We are trying to diversify from the tobacco end of our business, although it is still doing very well. We want to look to the future, and it’s kind of interesting to spend some time working on other things after 52 years in the business. It gives you new challenges.

We now have the fourth generation working in the family business. My son Jon is our sales manager and my daughter Joyce is in charge of the customer sales department. My grandson Frank II is now working in our warehouse. There aren’t too many family businesses left in the area anymore, especially as old as our company. The rules get tougher, the taxes get higher and sometimes it’s easy to think about selling our and walking away, but I’m not cut out for that.

The thing that has made Peoria great is the old companies that have been here for years and years. Burklund Distributors is a 52-year member of the Peoria Area Chamber of Commerce. We have roots that go way back in Peoria. Even though most of our business is done our of the Peoria area now, we still do a certain amount here, and are still a viable contributor to the area. We pay taxes; we support Bradley University and all the local charities; we do our part to be a good corporate citizen.

What has changed most about doing business over the years in the greater Peoria area?

What has changed the most is the demise of the small retail store. Back in 1946 when I went out on the road, there were probably 250 customers just in the south end of Peoria, south of Franklin Street. Today, just a handful of independently owned businesses are there. That’s true for every area of town. There are only a couple of independent drugstores left. Most of the grocery stores are chains. There used to be hundreds of independent grocery stores. The whole industry has changed. The smaller ones are gone and the bigger ones get bigger. It has made a drastic change in the amount of business we do in the Peoria area as compared to even ten years ago.

In 1989 your company moved across the river to East Peoria. What have been the positive impacts of that move? Have there been any negative impacts?

The move has all been positive. We now have more room, more parking, and a facility that is usable for many years to come. We ran out of room in Peoria and were either going to have to move or build another building. We started looking around in Peoria and didn’t get a lot of help from the Peoria development people. When we started looking in East Peoria, the East Peoria people were just there constantly, intensely interested, telling us about all of the positive reasons to locate here. They really made us feel welcome, so we made the move over here in 1989. We’re very happy over here. It’s easily accessible and available to the interstates.

We’re still Peoria citizens and I have nothing but great respect for the city of Peoria. But their acumen for keeping businesses in Peoria lost a little force somewhere along the line. I think that needs to be revived. Perhaps with our new City Council something will happen in that area.

Your name has appeared most often in the news the past two years in relation to your investment in the Greater Peoria Riverboat Corporation – the Par-A-Dice riverboat casino. What initiated your interest in the casino?

I was down on the island of Antigua on a tour, lying by a swimming pool. Someone came out of the main office one day and said, “I just heard that Illinois passed riverboat gaming.” I said “Boy, do I ever have a piece of land that would make a great dock for a riverboat!” We owned the land where the Par-A-Dice is now located. Originally Burklund Distributors was going to build a warehouse down there. It was a stroke of luck that we didn’t.

That was all that was said at the time, and I forgot about it. It happened that lying next to me around the pool that day was an attorney by the name of Irwin Jann, who was involved in dog track racing in Wisconsin and had connections in the gaming industry. Eight weeks later I got a phone call: “This is Irwin Jann. I’m coming down to see you.” I said, “What for?” He said, “Well, we’re going to talk about riverboats.” I said, “Well I’ll listen to you.” To make a long story short, he knew a company, Casino Cruises, which was an operational company; and a deal was put together. Before long we were applying for a riverboat gaming license, as was Jim Jumer on the Peoria side of the river.

When it was determined that a gambling boat license would likely be granted to a developer in the Peoria area, Jim Jumer and later Ray Becker were considered front-runners for the license. There were many people who didn’t give you much of a chance of landing the license. How did you manage to win it?

The fact that Jim Jumer had signed an agreement with Rock Island – and under Illinois law could only have a license in one place – allowed us to win the license for the area. Since two groups could not both apply from the Peoria side of the river, we applied from the East Peoria side.

When the Illinois Gaming Board gave us the preliminary okay for a license, we purchased the Boatworks from Jim Jumer. That gave us access to both sides of the river. We got our boat early – purchasing a boat that was under construction for an Iowa group – before our landbased facilities were even started. It was really a blessing in disguise that we were able to operate out of the Peoria side, because we were in operation much earlier than we would have been if we would have had to wait until our landbased facility was ready in East Peoria.

Getting the license and getting a group of investors together was not an easy task, but it all fell into place. We’ve had our ups and downs and problems to begin with, but what we have done has been based on sound business decisions. It’s been great for the area.

While the entire Peoria area has enjoyed the economic benefits, the Par-A-Dice has been a particular boon for East Peoria. How did the City of East Peoria facilitate your landing of the gaming operation?

During the entire time we were getting our license – attending the hearings of the Illinois Gaming Board and everything else – then-Mayor Dick Dodson and the East Peoria commissioners attended just about every meeting. There was total support from that group from day one. When the license was approved, the city’s priorities were very high in providing the infrastructure. The work we needed done was all in place the minute we started our building. Instead of the ten-year payoff that we had set up with East Peoria, we paid for it in nine months; so it was a good investment for East Peoria.

We are looking to develop some more of the area around the riverboat office, including a major hotel that could be a convention center. We don’t know what else might develop, but we are going to develop the whole area. That was the intent of the Riverboat Gaming Act – riverfront development in Illinois cities that needed some help. We are doing exactly that.

Many business and community leaders in Peoria were quite disappointed that the gaming boat did not land in Peoria permanently. Was there ever a chance that the Par-A-Dice could have operated from the Peoria side of the river on a permanent basis?

I doubt it. We were committed to the East Peoria side and we couldn’t very well change horses midstream. East Peoria supported us from day one. Unfortunately Mayor Maloof and some of the Peoria City Council members were lukewarm or against the riverboat at that time. We clearly saw where the total support was, and we already had a piece of ground with room for plenty of parking. With the total commitment from East Peoria, there was never any doubt we were going to locate here.

Some critics of riverboat casinos were afraid that they might attract criminal elements. Is that a legitimate concern?

Gaming is very tightly controlled. The controls are so strict; that’s the only reason I’m involved. There is absolutely zero chance of anyone of ill repute getting involved in the riverboat business.

Greater Peoria Riverboat Corporation recently announced that a larger boat will replace the current Par-A-Dice riverboat next spring, allowing for more gaming traffic. Is there still a future chance for a second gaming boat for the area, perhaps docked on the Peoria side of the river?

The gaming rules in Illinois allow a maximum of 1200 gaming positions. Our current boat has 800. If we were to have kept our present boat and acquired another smaller boat with 400 positions, that would have fulfilled the 1200 maximum. However, the minute you get the second boat, you have to have the second crew, the second building, the money counting facilities, the security, etc. When you double the overhead, the second boat really doesn’t make much sense, so that’s why we went ahead and ordered a larger boat so everything could be operated on one facility. I doubt very much that a second boat could ever be a reality. However, if land-based gaming ever happens, Peoria has the first shot at that under the inter-city agreement.

Refresh our memory about the inter-city agreement between East Peoria and Peoria concerning the splitting of tax revenue from the riverboat.

Under this inter-city agreement, the Par-A-Dice pays 20 percent of gross revenue to the state of Illinois. Twenty-five percent of that is then rebated back. Of that amount, 45 percent goes to East Peoria, 45 percent goes to Peoria, and ten percent goes into a common fund to be used somewhere on the riverfront that’s agreeable to both cities.

The new Par-A-Dice boat will have a contemporary, streamlined appearance. Have there been any misgivings about abandoning the old paddlewheel motif?

You have to remember that the paddlewheel was originally built for an Iowa group which was going to operate it out of East St. Louis. The license never materialized but the boat was already under construction. The theme was already set and the interior decoration was already in place. We had to take the boat the way it way, and had to do the best we could to make it fly. When we built our building, we went more art deco, and our new boat will be art deco to match our building. Our new boat will have more elbow room, wider aisles, and better air control. The paddlewheel theme was nice, but let’s be practical – the people want comfort. Most of them aren’t even aware they are cruising when they are on the boat, but they’re having a good time. I think they’ll have a better time if they are more comfortable and we can accommodate the number of people who want to be on the boat.

Do you believe that riverboat gaming will be approved for Chicago by the Illinois Legislature this fall or next spring?

That’s difficult to say. At the time we applied for the license, we were told there would be ten licenses issued. We knew what the risk factor was at that time. Then our 22 investors find out that, after making a sizable personal commitment, all of a sudden the rules could be changed. That’s not very palatable to any of us. We don’t know what’s going to happen up in Chicago. If riverboat gaming is approved, I hope it’s a small number of boars and that they have to live by the same rules we do – that they have to sail and do everything we do down here. Just tying boats up to a dock on the Chicago river is landbased gaming in my book, and that’s not the rule. I think they have to quit trying to have an endless pot to work from in Chicago. The rest of the state has to be frugal with its money, but Chicago thinks there’s a bottomless checkbook out there somewhere. Where does it stop? They should have to exercise from economy on their own.

How would riverboat gaming in Chicago affect the Par-A-Dice? How will the proliferation of gaming boats in the Midwest – including the Indiana Lake Michigan boats – affect the Par-A-Dice?

If it happens in Chicago, and when it happens in Indiana, it will probably affect the boats further north of us – like Joliet and Aurora – far more than it will us. They will probably start seeing the business being divided up instead of having the heavy play they have now. It’s going to affect us somewhat; but our feeling has always been that is we have the premier boat, the friendliest dealers, the friendliest employees, a reasonable cost of getting on the boat and if people leave the East Peoria area feeling that they have had a good time, we are going to get them back. I think that’s exactly what’s happening today. There are more boats out there than there were a year ago, but our customer count is up over a year ago. I think the reason is that they like what they see down here. We’ll have to take our gamble with everybody else, but we think we can hold our own.

How widely should casinos be used throughout the nation as economic development tools? When might a saturation point be reached in the Midwest?

Who knows whether there’s going to be a saturation point? I can refer back to the soft ice cream business. At one time there was a soft ice cream store on almost every third or fourth corner. Who’s left today? Dairy Queen. Why? Because they do the best job. The quality is there, along with the advertising and a good customer base. I think you are going to see a shake-out if the gaming industry gets too big. The ones who know what they are doing and who treat the people right are going to survive. The rest of them aren’t.

What are the economic benefits that the Par-A-Dice has brought to the area?

The fact that we brought 1,200,000 people in the first year gives you an idea. A good potion of those people had probably never been to Peoria before. We think that, in itself, it has helped the hotel industry, the restaurants, the gas stations, etc. Everyone has benefited from the number of new people coming into the area.

The customer count at the Hampton Inn next to the Par-A-Dice has been extremely high. I know that Peter Albanese is thrilled with what the motel is doing. We have people showing a great interest in what else might be built on our property. We’ve had calls about restaurants and other facilities. When a decision is made on further development, we want to make sure that it is something compatible with our business and something that will be a good investment on the part of the developers. We don’t’ want people to throw good money into something and not get a return on it.

Aside from private businesses, I think Peoria and East Peoria are realizing between $7,000 to $8,000 a day in revenue from the riverboat. In Peoria, I understand that the riverboat is probably building the new police station. We aren’t getting proper credit for that, but we are helping Peoria our by the police station being built without any real cost to the taxpayers. We’re happy for them to use it for whatever they want to use it for. Most of the original investors in the Greater Peoria Riverboat Corporation are Peorians, and we are glad that East Peoria saw fit to make this kind of a revenue split and help close the gap between Peoria and East Peoria, making it a combined effort. That is great for the whole area.

The Par-A-Dice has very definitely helped bridge the gap between communities on both sides of the river. I really have to take my hat off to the East Peoria people, because they very well could have played a selfish part and probably ended up with a larger share than they did, but I think the way it was handled is more than fair. When it first started out, I think Peoria wanted to split the revenue according to population count of something like that, but that got stopped real quick because East Peoria happened to be in the driver’s seat. I think they handled it very well.

Originally, the Illinois legislature intended to include loss limits in writing the riverboat gaming legislation, but they were ultimately not included. Some people said that some “funny business” was involved in the first writing of the legislation. What are your thoughts on this?

I wasn’t even aware that loss limits were included in the original bill. All I know is that they have a loss limit in Iowa and that’s why most of the Iowa boats are gone. When five dollars is the most you can bet, I will guarantee you that is you stay there long enough, you are going to lose $200. You have no chance on winning, because if you have a “hot streak” going, you can’t double up and end up amassing any kind of winnings to be able to walk our ahead of where you came in. That’s been the problem in Iowa. I hope Illinois never has a limit; because the way things are now, we at least have a chance to compete somewhat with Vegas and Atlantic City.

Proctor Hospital recently started a gambling recovery center. Do you have any reservations about the ultimate good of the gaming operation for the community in view of some people who evidently have a gambling addiction problem?

If they have an addiction problem, it hasn’t happened because of our local operation. Maybe is has helped add to that problem – perhaps. But this is no different than the hospitals having an alcohol-dependency or drug-dependency unit. That fact doesn’t mean that liquor sales are illegal or that is more liquor is sold, more people are going to be in there. It’s an illness just like anything else, and if there’s a place locally where they can get treatment, I don’t have any objection to that. Maybe a center like that is a good thing to add to the area, for people who have had problems long before we ever thought of having a riverboat here in East Peoria.

Greater Peoria Riverboat Corporation still owns the Spirit of Peoria excursion board and The Landing riverfront complex. What does the future hold for this venture?

The first year, we tried to operate the Spirit ourselves through Jumer’s expertise and his people. That was a very expensive proposition; we lost about $400,000. Then we decided that we would use the Spirit for our food services while the Par-A-Dice was docked in Peoria. When we moved over to East Peoria, we wanted to see the Spirit of Peoria floating again. So we offered to lease the Spirit and the whole riverfront complex to R&B Packet Company for one dollar for a year, to see if they could work out something and operate it at a profit. So far there have been problems with the weather, but from what I hear, August could see a “break-even” point.

If the City of Peoria or some other entity is interested in purchasing the Spirit of Peoria, we would be glad to listen to them. If there is an area the City of Peoria needs to subsidize, I would think it would be to keep the Spirit of Peoria operating, just for a draw to the downtown Eckwood Park area. However, we don’t know what’s going to happen so we are looking at other alternatives. We’ve had offers from people out of the area to purchase the boat. If we ever get involved in a gaming operation somewhere else, it could be a small gaming boat to get started. We’re looking at a lot of options, but somewhere down the line before October 31, we need to have some kind of indication from Peoria and R&B Packet as to what their intent is for next year. We’ve heard nothing yet, but we’ve made them aware that they need to let us know what their intent is. I have nothing but the greatest respect for keeping the Spirit of Peoria running. I don’t think very many companies would lease almost a $6 million investment for one dollar to see if it could remain viable. I would think that something could be worked out to keep the boat in Peoria, but that’s their decision. We’re waiting to hear from them.

Area businesses and community leaders are looking at further development along the river in the Heartland Riverfront Project. Have you or the Greater Peoria Riverboat Corporation been involved in this project, or has your input been sought?

The Heartland Riverfront Project is a great unit to at least get something moving. We are very fortunate to have a beautiful river running through the area and we need to develop the riverfront. The Greater Peoria Riverfront Corporation is a relatively new company and we haven’t gotten too involved because we still don’t have all of our ducks in a row yet. I’m sure, however, that we are going to be a factor in what happens, particularly on the East Peoria side of the river. If I remember correctly, the money that East Peoria derives from the riverboat could be used for riverfront development. So, we will have a very definite part to play there.

What are your thoughts about the Heartland Water Resources Council and the siltation problems facing the Illinois River and Peoria Lake?

Someone commented a number of years ago that if we were to widen the channel, allowing barges to get out of the channel during high water periods, stir up the silt and let it flow downstream, eventually we could end up with a nicer, wider channel. It wouldn’t’ clear everything up, but perhaps if we could stop further excessive siltation, something like that could be successful without spending the hundreds of millions of dollars that they are talking about to do something with the Illinois River. We have a beautiful river here; we just need to make good use of it and take care of what we have. We need to address the problem without a lot of cost to taxpayers.

We are very water-oriented. Many people don’t know that a division of our company is National Marine on Galena Road in Peoria Heights. We sell and service boats, and have slips and storage. The depth of the water and siltation problems are of definite interest to us. Most of the areas around here, when the water is at normal levels, do not have enough depth for boats to even get in and out of the harbor. We are very interested in dredging and other things to maintain a good depth for boats.

Recreational boating is growing every year. It’s great on a sunny day to see hundreds of boats out on the river. It’s a family activity that we thing is good for the area, and it helps further develop the waterfront. IBI

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