When her hometown first legalized casino gambling in 1976, Atlantic City native Turiyah Abdur-Raheem had her doubts.
“I wasn’t here then, I was still away at college, but I was concerned about my family and friends who still lived here,” said Raheem. “I think my biggest concern was whether or not people in the community were going to really benefit; or was it going to still be a situation where these casinos and other casino-related businesses were going to thrive, and the community was going to suffer.”
That was nearly four decades ago. For three of those decades, Raheem lived elsewhere. When she returned to her hometown in 2008, what she found was “heartbreaking,” she says.
“It benefits one side of the city and not the other. It doesn’t trickle down. “
“I was hearing more and more stories about hopelessness, about people not being able to be hired,” said Raheem, the author of a recent book about growing up in “the other Atlantic City.” “Last hired, first fired. Whereas we always had jobs as teenagers, the teenagers here were not being hired. Other teenagers were able to come in and get work, and our teenagers were not.”
For Abdur-Raheem and some other residents of Atlantic City, impending casino closures are just another bump in the community’s long, fraught relationship with legalized gaming. They see an industry that has grown fat in their backyard, while sharing little of the profit. In 2010, Atlantic City casinos took in $3.6 billion; meanwhile, the city’s median household income between 2008 and 2012 was just under $30,000.
Yet the gaming industry nationwide is on the ascent, even as three major Atlantic City casinos threaten to close within the next few weeks. Roughly two decades ago, casinos could only be found in six states; as of last year, 22 states have commercial casinos, according to an American Gaming Association (AGA) survey [PDF]. That same survey found that casinos raked in $37.34 billion nationwide in 2012. Only in 2007, the year before the financial collapse, did the industry collect more in revenue.
MSNBC contributor Dorian Warren, Carmen Rita Wong from NYU Poly Tech, MSNBC.com’s Ned Resnikoff and Michael Pollock from the Spectrum Gaming Group join to discuss the changing face of Atlantic City and the closing of some of its major casinos.
The question facing Atlantic City, and a growing number of other communities around the United States, is where all that revenue goes. While industry spokespeople argue that commercial casinos do wonders for a local economy, not all Atlantic City residents agree.
“It benefits one side of the city and not the other. It doesn’t trickle down,” said Atlantic City councilman-at-large Moisse Delgado. “Tourism dollars are good for the industry. It’s not as much for the municipality and its residents.”
A significant chunk of the city’s revenue does come from casinos. According to Atlantic City’s 2013 audit report [PDF], local government collects about 65% of its taxes from the gaming industry. While in earlier times that might have allowed the city to share in the industry’s prosperity, today it means the municipality has no safety net when casino revenues decline. Earlier this month, Atlantic City Revenue and Finance director Michael Stinson told Reuters that impending casino closures could wipe out as much as half of the city’s tax base.
Adding to the city’s financial woes, its unemployment rate is markedly higher than the national average, and wages tend to be lower. Delgado alleges that’s because “front of the house” casino jobs – relatively high-paying jobs that require a greater degree of customer interface, such as tending bar or manning the blackjack tables – usually go to people who don’t live within city limits.
“People who have those jobs don’t live on this island,” he said. “They live in farther towns. They live 60 minutes away, two hours away. They don’t call it home, they don’t see it as home, they don’t invest in home.”
People who live in the city – most of whom are either African American or Latino – do the back of the house jobs, such as cleaning rooms and doing line cook work, said Delgado. But Joe Kelly, president of the Greater Atlantic City Chamber of Commerce, argued casinos “have done a wonderful job in creating employment opportunities.”
“I don’t think that’s consistent with what I’ve seen,” he said of Delgado’s concerns. “I’ve seen a number of professionals come through the local market that have gone on to take leadership roles in the casinos that were local citizens.”
For industry leaders and experts, the watchword in Atlantic City is “diversification.” The local Chamber of Commerce is trying to resuscitate business in Atlantic City by expanding tourism and hospitality services beyond just gambling. If that effort is successful, the city will come to more closely resemble Las Vegas, where gambling now accounts for just about 36% of revenue in the main tourism center known as the Las Vegas Strip. Dining, musical entertainment and retail have come to occupy a larger chunk of that city’s income. Industry analysts believe that developing those industries in Atlantic City would help to distinguish it from the myriad other Mid-Atlantic towns that now host casinos.
“It’s a tourism destination,” said Sara Rayme, senior vice president of public affairs for the AGA.
“As more markets have come online, clearly it’s up to the policy makers in tandem with the operators to make sure their business models are evolving and changing with what’s going on around them.”
“As an Atlantic City native, I can see it’s definitely been a boon.”
Rayme also believes that casinos have been good to Atlantic City overall, saying “gaming has been incredibly successful in Atlantic City for the past 30 years.” The AGA estimates that Atlantic City casinos have “directly supported 1.4 million jobs” and “generated $9.3 billion in tax revenue,” according to a fact sheet [PDF] shared by Rayme.
David Schwartz, the director of the University of Nevada, Las Vegas’ Center for Gaming Research, said “the city was completely moribund” before legalized gambling.
“As an Atlantic City native, I can see it’s definitely been a boon,” he said. “Created a lot of jobs, brought in a lot of development.”
The Federal Reserve of Philadelphia has expressed a little more ambivalence regarding the industry’s effects. In a recent survey [PDF] of the available literature regarding gambling’s economic impact, the Philadelphia Fed found that casino revenue can do some good for state tax revenues and generate jobs; however, the same report offered a grim prognosis for Atlantic City’s gambling industry.
Another report focusing on Atlantic City in particular [PDF] noted that the local gaming industry “has typically provided jobs for more than 10,000 city residents,” but added that “many of the problems that gambling was supposed to alleviate remain severe.”
The paradox of Atlantic City, they write, is that it is “a place where plentiful jobs are juxtaposed with high levels of poverty and unemployment.” The way forward is not yet clear.
Join with your friends and neighbors to protect ALL Massachusetts.....Opposition is GROWING!
Friend,
As you may know, our first
financial reporting period of the year ends tonight at midnight. Our email
on Wednesday broke records for us in terms of both the number of donations and
amount raised for a single day - but we still have work to do to reach our goal
of 250 contributions before the fundraising deadline.
The strength of our grassroots
organization will be judged on how we do today. Who is watching? Voters across
the nation. "The November vote will be closely watched as a bellwether of the
[casino] industry's future."
We may not be able to cut million
dollar checks like the casino bosses, but we need to show that we have something
they don't - small donors committed to protecting the future of
Massachusetts.
Hoa Nguyen, htnguyen@lohud.com 11:24 p.m. EDT August 29, 2014
A third of Atlantic City casinos in business at the start of this year have shuttered their doors or plan to permanently close as the summer tourist season winds down in a few weeks.
The closings represent job losses for thousands of people — roughly a quarter of the industry's workforce. There were about 9,000 people employed last July at the Atlantic Club, which closed this year, and Revel, Showboat and Trump Plaza, which are in the process of shutting down in the next few days and weeks.
Opened in 1978 as the country's second gambling capital behind Last Vegas, Atlantic City's casino industry is facing mass closings that some analysts believe may be a glimpse of what could happen in New York as the state races to license the building of more casinos.
"Atlantic City is definitely a harbinger," said Roger Gros, an industry analyst and the publisher of the trade publication Global Gaming Business Magazine. "What looks like a golden opportunity one year may not always be there."
Nevada and New Jersey used to be the only states that allowed gambling. But today, some form of casino betting exists in 39 states. The stiff competition, sluggish economy and what some believe is a market overly saturated with casinos has resulted in declining gambling revenues in Atlantic City since 2008.
Casinos at the New Jersey seaside resort are not only competing with one another for the same customers but also with recently opened properties across the Northeast and mid-Atlantic, particularly in neighboring Pennsylvania, where six racetracks with casino gambling and six standalone and resort casinos have opened within the past decade. Two more also are on the way.
In New York, slot machines at Empire City in Yonkers and Resorts World Casino in Queens also have drawn so-called convenience gamblers who otherwise would have traveled to Atlantic City but now have closer betting options.
But many analysts and operators still believe there is room in New York for more gambling sites, particularly destination casinos that offer a mix of table games, slot machines and other entertainment, sometimes described as Las Vegas-style casinos, in addition to other amenities, such as golf courses and water parks.
At the moment, there are nine racetracks that offer slot machines and other types of electronic gambling and five upstate Indian-owned casinos. Last year, New York voters approved a constitutional amendment that would add seven Las Vegas-style casinos — none near New York City for now but some of the proposals are close enough to rattle officials at Empire City casino.
Yonkers Mayor Mike Spano said every time he goes to Albany or speaks to lawmakers, he advocates on behalf of Empire City casino being allowed to expand its gambling operations beyond slot machine-type games, particularly as state regulators look to issue licenses for up to two new full-service gambling resorts in the Hudson Valley and Catskills area, namely in Orange or Sullivan counties. Up to three additional licenses are expected to be issued elsewhere upstate for a total of four across New York state.
Proposals to build a full-service casino in Tuxedo or Woodbury village, Orange County — about 40 to 45 miles from Yonkers — would place Empire City casino at a definite disadvantage.
"My fear is that you allow other gaming to take place around Yonkers — that could hurt us," Spano said.
Empire City officials have already begun actively lobbying against having a full-service casino in Orange County. Spokeswoman Taryn Duffy called moves to build a casino in Orange County tantamount to a "poison pill" because it would pull customers from the Yonkers casino as well as draw gamblers from nearby sites, such as the Catskills.
At the same time, Empire City casino presumably would have a shot at obtaining a full-scale casino license when a moratorium on issuing "downstate" casino licenses expires in about seven years. But some officials said given market forces, seven years might be too long to wait.
"I don't have any imminent concerns, I have long-term concerns," Spano said of Empire City casino. "The raceway is viable. In seven years, is it still viable to expect that an investor will want to put a full gaming facility?"
Starting Sept. 8, casino applicants will go before the New York Gaming Facility Location Board to make their pitch. On that same day, New Jersey Gov. Chris Christie will hold a summit in his state to discuss Atlantic City's future, where officials will presumably talk about possibly expanding casino gambling to the Meadowlands or Jersey City, given Atlantic City's weak returns.
Matt Dalton, the head of Belle Haven Investments, a White Plains-based fixed-income and municipal bond investment firm, said that because casinos can generate millions and have proliferated across the country, some municipalities see it as an easy way to make money.
"It's one of those industries that communities want to chase," he said. "Twenty years ago, not everyone was doing it. Now everyone's trying to do it."
But the closing of four casinos in Atlantic City demonstrates that they might not be lasting investments.
"The challenge you have now is you're dealing with competition," Dalton said. "The casinos that are going to be built now, they're not all going to survive."
In wheelchairs and on walkers, Baltimore's big plan for the future shuffled into the Horseshoe casino this week to begin the city's renaissance. Again.
"Horseshoe brings the promise of a better Baltimore," declared Baltimore Mayor Stephanie Rawlings-Blake at the casino's grand opening Tuesday night.
Hold your horses, Ms. Mayor. This better Baltimore you envision is a cavern of blinging slot machines and blackjack, craps and poker tables fueled mostly by the pension checks and minimum-wage earnings of the city's struggling folks.
The myth that you're keeping glam Vegas money here in the state is a dream. I'm sorry, but Mr. and Mrs. Tuxedo aren't thanking their lucky poker chips that they have Baltimore instead of the Bellagio to blow their fortunes on.
The next "Hangover" sequel will never be a hilarious escapade through Baltimore's Fells Point where Bradley Cooper drunkenly elopes with a waitress who called him hon.
Destination gambling is one thing. But this new scheme in Baltimore is not competing with Monaco and Macau. This is the kind of gambling that's the equivalent of bottom trawling, preying on the optimism, desperation and sometimes even addiction of vulnerable folks who wouldn't be flying to Las Vegas or even taking the bus to Dover Downs.
I grew up around casinos in a resort town on Lake Tahoe. My immigrant parents got their start in America working in a casino. Most of my high school jobs were in casinos. My brother and I took pictures with the Caesars Santa, my tap-dancing recitals were on the Sahara stage, my 13th birthday party was dinner at Harrah's.
Casinos can provide jobs and become important building blocks in a community. But I also saw families, careers and lives ruined by gambling addiction that devastated locals long after the big-spending tourists went home.
So imagine what happens in a city like Baltimore, where a quarter of the 622,000 residents live below the poverty line. One of the first places that tried urban gambling is Detroit. And last I checked, that hadn't worked out so well.
As Maryland opened its first urban casino, the state lottery commission also reported a second year of decreased sales. The first drop in 15 years came last year, right after the Maryland Live casino opened near the Arundel Mills Mall.
But look at the success of that glittery behemoth on what was shopping mall parking lot! Maryland Live raked in nearly $53 million in July, according to the state gaming commission.
First of all, it's pretty stunning to think there's $53 million lying around for folks to throw away in a casino. The bigger question is this: What's going to happen to that stream of money now that gamblers from Baltimore can just take the city bus – the 51 line is changing its route to go through some of the city's poorest neighborhoods on the way to the casino – instead of going to Arundel Mills?
And that pool of cash the Arundel Mills folks are swimming in is going to take another hit in two years, once MGM Grand opens the bazillion-dollar gaming emporium at National Harbor in southern Maryland.
The downtown Baltimore casino is the fifth to open in Maryland, which legalized slots in 2008 and table games in 2012. Gambling proponents argued successfully Maryland would keep some of the gambling millions going to neighboring Delaware and West Virginia.
But now Maryland casinos that were all about keeping cash within state lines are beginning to devour one another's business.
Four casinos will be closing in Atlantic City by summer's end. There's a constant death watch in Las Vegas. This summer, I visited my home town in Nevada, where casinos were reporting a 22 percent drop in revenue compared with summertime last year.
So it's difficult to believe that the best bet for the future of Baltimore is to build it on the backs of some of the city's most vulnerable residents.
Petula Dvorak is a member of the Washington Post Writers Group.
This July 11, 2014 aerial photo shows Trump Plaza, left, and Caesars Atlantic City, right, on the Atantic City N.J. Boardwalk. A report issued Aug. 29, 2014 by Wall Street firm Fitch Ratings predicts much of the gambling revenue from Trump Plaza and two other casinos closing down soon, Revel and the Showboat, will remain in Atlantic City after they are gone. (AP Photo/Wayne Parry)
The Associated Press
By WAYNE PARRY
Associated Press
August 30, 2014
ATLANTIC CITY, N.J. (AP) — A time few could imagine during the not-too-distant glory days of casino gambling has arrived in Atlantic City, where two casinos will close this weekend and a third will shut down in two weeks.
More than 5,000 workers will lose their jobs in an unprecedented weekend in the seaside gambling resort, leaving many feeling betrayed by a system that once promised stable, well-paying jobs.
The Showboat is closing Sunday, followed by Revel on Monday and Tuesday. Trump Plaza is next, closing Sept. 16. To the thousands who will be left behind, it still seems unreal.
‘‘We never thought this would happen,’’ said Chris Ireland, who has been a bartender at the Showboat since it opened. His wife works there, too, as a cocktail server. Before dinnertime Sunday, neither will have a job.
What makes it even tougher to swallow is that the Showboat — one of four Atlantic City casinos owned by Caesars Entertainment — is still turning a profit. But the company says it is closing Showboat to help reduce the total number of casinos in Atlantic City. Caesars also teamed with Tropicana Entertainment to buy the Atlantic Club last December and close it in January.
‘‘They just want to eliminate competition,’’ Ireland said. ‘‘Everyone’s in favor of a free market until it doesn’t exactly work for them.’’
Yet many analysts and casino executives say the painful contraction now shrinking Atlantic City’s casino market is exactly what the city needs to survive. Since 2006, Atlantic City’s casino revenue has fallen from $5.2 billion to $2.86 billion last year, and it will fall further this year. Atlantic City will end the year with eight casinos after beginning the year with 12.
New casinos popping up in an already saturated Northeastern U.S. gambling market aren’t expanding the overall pie but are slicing it into ever-smaller pieces. Fewer casinos could mean better financial performance for the survivors.
Resorts Casino Hotel, which was on the verge of closing a few years ago, completed a remarkable turnaround in the second quarter of this year, swinging from a $1.3 million loss last year to a $1.9 million profit this year.
‘‘I truly believe that eight remaining casinos can all do very well when the gambling market is right-sized,’’ said Resorts president Mark Giannantonio.
That may be true, but it is little comfort to workers who are losing their jobs. By the time Trump Plaza shuts down in two weeks, nearly 8,000 jobs — or a quarter of Atlantic City’s casino workforce — will be unemployed. A mass unemployment filing due to begin Wednesday is so large it has been booked into the city’s convention center.
When casino gambling was approved by New Jersey voters in 1976, it was billed as a way to revitalize Atlantic City and provide stable, lasting jobs. The first casino, Resorts, opened in 1978, kicking off three decades of soaring revenue and employment.
But the Great Recession hit just as new casinos were popping up in neighboring Pennsylvania and New York, cutting deeply into Atlantic City’s customer base.
‘‘There was a promise when casinos came in here that these would be good, viable jobs, something you could raise your family on and have a decent life with,’’ said Paul Smith, a cook at the Trump Taj Mahal Casino Resort. ‘‘I feel so bad for all these people losing their jobs. It wasn’t supposed to be like this.’’
Mayor Don Guardian says his city is remaking itself as a more multifaceted destination, where gambling is only part of the allure. But he acknowledges the pain this weekend will bring.
‘‘This is going to be a difficult few weeks for many of us in Atlantic City,’’ he said. ‘‘People will lose their jobs, and that is never good news. Our hearts go out to our neighbors and friends. We still have difficult waters to navigate.’’
Daily News - August 28, 2014 - Vietnamese drug gang abducted three men, dumped bodies in Philadelphia river.
Two brothers were loaned $100,000 to buy drugs, but spent it all at a Chester, Penn. casino [Harrah's Chester Casino And Racetrack] before being abducted by a Philadelphia drug lords. Their throats were slit before being dumped in the Schuylkill River with a third man who survived the abduction.
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