Craps! Atlantic City Lost Big Bucks Last Year
Pennsylvania’s decision to legalize casino table games back in 2010 has really paid off. A new economic report by the American Gaming Association says the state’s gambling industry had one of the largest hikes in revenues in the United States last year. But just as it is at the poker table, for every big state casino industry win there is also a loss. With its business undercut by new casinos in neighboring states, New Jersey saw the greatest revenue drop in the country between 2010 and 2011 — a 7 percent decrease.
As New York prepares to open table games at seven non-Indian casinos, and experimental efforts to revitalize Atlantic City aren’t performing as well as hoped, can Atlantic City be saved? Or like Atlantis before it, will this beachside empire crumble into the sea?
Fifteen of the 22 states where non-Indian casinos are legal saw their revenues increase, Frank J. Fahrenkopf Jr., president of the American Gaming Association, told the Chicago Tribune.
Pennsylvania came in second place, next to Maryland, with a 21 percent increase in total casino revenues — including profits from gaming, as well as other services — that added up to just over $3 billion. New York’s gaming revenues alone grew 15.6 percent.
In recent years, the growth of new casinos and legalization of table games in Pennsylvania, coupled with the legalization of slot machines at nine racinos in New York State between 2004 and 2010, have kept many chance-taking tourists away from Atlantic City. In 2013, the New York State legislature is expected to move forward with New York Gov. Andrew Cuomo’s plan to legalize table games at seven of the nine racinos, which will inevitably lure more potential Atlantic City customers away from New Jersey.
“Overall, to me it’s not discerning,” New Jersey Assemblyman John Amodeo (R), a member of the Assembly Regulatory Committee, told Mike Schneider on NJ Today. “You have to look at what we see as a vision for Atlantic City not so much as not being a gaming destination anymore, but being a total resort destination,” he added.
In an effort to save Atlantic City’s economy, which is fueled predominantly by its 11 casinos, New Jersey Gov. Chris Christie created a state-operated tourist district in the city last year; part of the “vision” to which Amodeo referred. Plans are still be worked out, but some preliminary suggestions for revenue increases include reducing property taxes through zoning code changes, and tax waivers for local businesses.
Click on the images below to view economic snapshots of casinos in New York, New Jersey and Pennsylvania:
All images from the American Gaming Association’s 2012 “State of the States” report.
While the tourism district is still in the planning stages, many Atlantic City residents and stakeholders are putting their chips on an unorthodox new casino. Revel, which opened in April of this year, breaks with casino convention in numerous ways. Whereas other casinos pack every inch of space with slots and games, the $2.4 million Revel markets itself as a family-friendly resort, devoting much of its space to entertainment and fine dining opportunities. As a symbolic representation of its maverick status, Revel faces the ocean — a deliberate affront to tradition.
It’s been years in the making, but after multiple financial setbacks, Christie agreed to give Revel $261 million in tax credits and $2.6 million to train its employees in 2011, in order to get things moving. As a result, UNITE HERE!, with help from two other unions, are currently campaigning to organize Revel’s workers.
Despite the state-assistance, though, Revel’s earnings haven’t been particularly impressive since it opened. But many are hoping that summer vacation dollars will soon begin rolling in.
“Although it is too early to judge the success of Revel based on one month’s revenues following a soft opening, gaming revenues of $13.4 million are underwhelming,” analyst Andrew Zarnett, of Deutsche Bank A.G., wrote to the Chicago Tribune. “As we head into the busy summer months, gaming revenues for Revel will need to dramatically improve, and we believe they will,” he added.