Genting to get bargain basement pricing in Florida

Who'll lose if big casinos come to South Florida? Hotels, restaurants and pari-mutuels worry
By Kathleen Haughney and Nick Sortal, Sun Sentinel

TALLAHASSEE — — As momentum builds to bring multiple world-class casinos to South Florida, the winners are obvious: the construction industry and people seeking jobs in the hotel or restaurant trades.

But who would be the losers? Local and statewide business groups, including the politically powerful Florida Chamber of Commerce, are worried that new casinos could poach customers from already existing hotels, restaurants and other companies, and cause them to go under.

"There's a major threat to current businesses that are here," Florida Chamber President Mark Wilson said this week.

So far, there have been no substantial studies to determine whether the South Florida market could handle a massive expansion of legalized gambling that under one plan, would bring in three enormous Las Vegas-style casinos to compete with existing pari-mutuel facilities. But that's not keeping some opponents of expanding gambling from voicing concerns that South Florida could soon look like Atlantic City, N.J., where giant 24/7 seaside casinos operate virtually right next to slums.

A 1997 study from the California Research Bureau, a nonpartisan research service for the California governor and Legislature, found that in Atlantic City, the number of restaurants dropped 40 percent since 1977, the year after New Jersey voters authorized casino gambling in the state.

"This has always been one of the knocks on casino developments, that it never helps the surrounding community and the most extreme of that is Atlantic City," said Bob Jarvis, a law professor specializing in gaming law at Nova Southeastern University. "The three blocks around it are very nice, but if you go off those three blocks, you see no redevelopment. It's just as blighted as it was before."

Jarvis said he doesn't believe destination casinos would kickstart local economic development at all, but that they could drive existing gambling establishments like Mardi Gras Gaming or Gulfstream Park out of business, depending on where new casinos are built and what kind of taxes they'd have to pay.

Existing pari-mutuels have been arguing for years that their tax rate is too high. They currently pay a 35 percent tax rate on slot machine revenues. Under plans being floated in the Legislature, new destination casinos would only pay a 10 percent tax rate for gaming earnings.