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New Jersey Inching Toward Casino Vote

Lawmakers Still Vetting Plan To Have November Referendum

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A legislative committee in New Jersey held a hearing Monday on the plan for a November referendum to decide whether to allow two casinos in the northern part of the state.

According to the Associated Press, opponents of the new casinos, which could be built in East Rutherford and Jersey City, expressed concerns that they would deal yet another blow to Atlantic City’s casino gambling market.

Four Atlantic City casinos closed in 2014, but revenues have remained somewhat steady since for the existing properties. The world’s largest poker site announced just last week that it will be launching in the Garden State this month, which is great news for the seaside gambling town that has been flirting with bankruptcy. Garden State online gambling sites have to be based in Atlantic City.

According to the AP report, a second hearing on the referendum plan is scheduled for next week in the State Assembly. The bill needs at least three out of five lawmakers in each legislative body to approve it. Then voters will be asked whether to allow the change to the state’s constitution.

The possibility of a statewide vote on the issue has already prompted Hard Rock International and the Meadowlands Racetrack to partner up for a casino proposal. Deutsche Bank estimated that the casino could generate $500 million a year in gaming revenue, roughly one-fifth of all gaming revenue generated by Atlantic City’s eight remaining casinos in a year.

Atlantic City casino win in 2015 was $2.56 billion, down 6.5 percent from $2.74 billion in 2014. The market has been contracting ever since 2006’s record of more than $5 billion.

 
 
 
 

Comments

Steve59
4 months ago

Whether New Jersey approves one or two casinos, the first should be the Meadowlands, where a temporary facility could be operating within months of the enabling referendum. The site has great highway and rail access, and is located in a commercial zone; with sports stadiums and an unfinished outlet mall, Xanadu, next door. And most importantly, the Meadowlands has proposed a 55% tax on slot win, where a reasonable share would provide much needed help to Atlantic City. A single casino at the Meadowlands, could win as much as $750 to $800 million at the slots and another $200 to $250 on table games, probably equating to $425 to $475 million or so in annual casino taxes.
This development would be very positive for New Jersey, providing thousands on new jobs, and impacting Eastern Pennsylvania and New York gaming far more than Atlantic City. A North Jersey casino could also help the unemployed casino workers in Atlantic City, by giving them first shot at many of the jobs, especially those requiring gaming experience. This would not be unusual, as similar type language was included in the 1977, NJ Casino Control Act.
NJ Senator Whelan is correct that New York could approve casinos for Manhattan, but North Jersey would still have 6 million residents to support a Meadowlands casino, and still be more convenient to Staten Island, Orange Co. NY, and certain parts of Manhatan. And those worrying about the size of the market that used to support $5.2 billion in casino win for Atlantic City casinos in 2006; need to understand that convenience greatly expands the potential revenues. Eastern casinos, serving the markets that AC used to rely on in 2006; now win $2 billion in Pennsylvania, $1.3 billion at Aqueduct and Yonkers, nearly a
$ billion in Maryland, and with AC still winning $2.5 billion, the regional total is $6.8 billion (30% more than 2006). And I have not included Delaware, Charles Town, WV or the Tribal casinos in Connecticut, that opened prior to 2006, but were part of AC's monopoly market in the early 1980's.
Atlantic City proponents need to realize that its critical mass is still going to attract from our previous markets, but primarily on weekends and during the summer months. So AC needs to make expand its reach for city wide conventions and trade shows, that could fill our rooms 200 nights a year, mid week in the Fall, Winter and Spring, like Las Vegas does; and turn our non casino departments into profit centers. And that requires commercial air service into AC International, where funds from the resorts share of North Jersey taxes could help.
Steven Norton

 
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