Gaming alert | New Jersey voters to decide on new casinos in November

This undated illustration shows what the proposed Hard Rock Casino Meadowlands in East Rutherford, N.J., would look like

Voters will be asked in November whether to approve two new casinos in the northern part of the state under a ballot question authorized yesterday [Macau time] by the Legislature.
It will mark the first time in 40 years that the state’s voters will have a say about expanding casino gambling in New Jersey. And it could have far-reaching consequences for Atlantic City, which has already lost more than half its casino revenue to competitors in neighboring states.
On a packed general election ballot that also will include presidential candidates, voters will be asked whether to amend the state constitution to repeal a provision that limits casinos only to Atlantic City. It would authorize two new casinos in separate counties at least 72 miles from Atlantic City.
It doesn’t specify locations, but the two most-talked-about proposals are in the Meadowlands sports complex in East Rutherford, where the NFL’s Jets and Giants play, and in Jersey City, just across the Hudson River from Manhattan.
Applications would be accepted only from casino operators presently licensed in the state. The process would be open to other operators if 60 days pass without bids. The bidders must be willing to commit USD1 billion on the projects, with a portion of revenue going to public improvements in struggling Atlantic City.
The casinos would create potential new competitors for gambling resorts in Pennsylvania, New York and Atlantic City, as well as opportunity for New Jersey’s current operators.
MGM Resorts International, which co-owns the Borgata in Atlantic City with Boyd Gaming Corp., has said it is interested in such a project. Las Vegas Sands Corp., which owns a casino in nearby Bethlehem, Pennsylvania, has said it’s interested in building a large convention center and gambling complex outside New York.
Other operators include Caesars Entertainment Corp., Atlantic City’s largest casino company with three properties; and Tropicana Entertainment Corp., controlled by billionaire Carl Icahn.
“This is a very historic day for New Jersey,” said Assemblyman Ralph Caputo, an Essex County Democrat and former casino worker. “In 1976, casinos were approved for Atlantic City. It was a monopoly that existed for many, many years; many people benefited. But conditions change, and when conditions change and you don’t adapt, you become a dinosaur and you become extinct.”
Atlantic City Mayor Don Guardian, a Republican, predicted that three of his city’s eight remaining casinos will close because of new in-state competition; other officials and Wall Street analysts say as many as four could go under because of the new competition.
Supporters say the new casinos will recapture gambling money that’s now going to casinos in neighboring states and help rebuild Atlantic City.
Jeff Gural, operator of the Meadowlands Racetrack, has offered to pay a 55 percent tax on revenue at a casino he would build with Hard Rock International; Atlantic City’s casinos now pay an 8 percent tax, plus an additional 1.25 percent in mandatory redevelopment contributions.
“This will provide the funds needed to rebuild Atlantic City into a first-class destination resort while at the same time provide several hundred million dollars for seniors and money to save the horse-racing industry,” Gural told The Associated Press.
The referendum is the result of a nearly decade-long decline in Atlantic City brought about by casinos opening in neighboring Pennsylvania in late 2006, and worsened by others in New York and Delaware.
In 2006, Atlantic City’s casino revenue was $5.2 billion; last year it had fallen to $2.56 billion. In 2014, four of the city’s 12 casinos went out of business. Wayne Parry, Trenton (NJ), MDT/Agencies