Genting’s shifting casino plan in Florida

January 20, 2014 9:03 am

Remember when casino giant Genting claimed it was going to build an elaborate multi-billion dollar resort in Miami? Now, it turns out the Malaysian-based operator will settle for a bare-bones slots barn.

Talk about showing your cards. It seems Genting will say and do whatever it takes to bring more gambling to Florida. That is really what the casino debate is all about.

Recall in 2012 how Florida lawmakers rejected Genting’s effort to build a destination casino resort in Miami. That came after Genting hired an army of influential lobbyists and spent more than $1 million pushing to legalize casinos in the Sunshine State.

Now, Genting has shifted gears and is pushing a plan to team up with a racetrack operator to build a slots-only facility in South Florida. So much for the glamorous tourist resort. Genting is now targeting local and repeat slots gamblers.

The new plan will add nothing to the economy and do little to attract tourists. Instead, Genting wants to just bleed the local gamblers with a giant slots barn.

The Florida plan sounds a lot like the Genting slots barn at the Aqueduct racetrack in Queens, New York. That facility rakes in nearly $2 million a day and is one of the most profitable gambling halls in the country. The Queens facility does not attract tourists and instead caters to mostly local gamblers.

New York Times columnist Michael Powell captured the scene in Queens when he described Genting’s Resorts World as resembling an “airport departure lounge mated with a pinball machine.” The Times’ Clyde Haberman also interviewed gamblers at the Genting slots hall and found not many were there for fun or looked anything like James Bond. Expect the same scene in Florida if Genting gets its way.

Genting was behind the effort to legalize casinos in New York. Genting’s influence was on display in New York. As a candidate for governor, Andrew Cuomo never even discussed casinos. But less than a year into his term he began pushing the idea – thanks to some help and money from Genting.

Now that casinos are legalized in New York, Genting is showing its true colors. After touting how casinos will bring jobs to New York, Genting recently announced nearly 200 layoffs. Likewise, Genting’s initial Florida plan was going to create lots of jobs, but those plans have been scaled back as well.

In Florida, Genting is poised to do whatever it takes to bring more gambling into the state.

Maryland residents split over casinos

October 25, 2012 11:41 am

Give Maryland lawmakers this, at least taxpayers will get to decide if the state needs more casinos. And by accounts, the vote on Election Day will be close.

Maryland residents are sharply divided over the benefits and drawbacks of more gambling in the state. Sure, the casino will create jobs and more tax revenue. But the casino also diverts money that would have been spent at other businesses; strips wealth from the pockets of taxpayers; creates more repeat and problem gamblers; and leads to increase in crime, bankruptcy, divorce and suicide.

Anyone who takes the time to study the issue will understand the negative effects of casinos outweigh the benefits. Sadly, much of the public is not well informed about the issue. That’s due in part to thinly reported stories like this one in The Baltimore Sun that only scratch the surface of the issue and fail to dig into the deeper social and economic costs that come with casinos. At the same time, it is tough to overcome the misleading ad campaigns by casino supporters.

Despite the lack of information and misinformation, polls indicate voters may still defeat the referendum that would allow another casino and table games at the existing slots parlors. But if the public fully understood all the issues surrounding casinos, voters would overwhelmingly reject the measure.

New York’s convenience casino

October 24, 2012 11:52 am

A sterile slots parlor at a racetrack in Queens, N.Y. has become the most lucrative convenience casino in the country, and is upending the gambling landscape in the Northeast.

The Resorts World Casino in New York has raked in nearly $630 million in revenue over the last 12 months just from slot machines. That figure tops the slots take at any of the casinos at destination resorts in Atlantic City or at Foxwoods or Mohegan Sun in Connecticut. The average income from an electronic slot machine in Queens is more than $370 a day, compared with $169 for slots on the Strip in Las Vegas, The New York Times reports.

Unlike many of the opulent casinos in Atlantic City, Connecticut or Las Vegas, the slots joint in Queens offers no fancy amenities, such as high-end restaurants, big-name entertainment or an upscale hotel. Its only competitive advantage is its location in densely populated New York City. The short subway ride or drive for New York gamblers beats schlepping to Atlantic City or Connecticut for gambling action.

“Convenience and location are the driving factors today,” William R. Eadington, director of the University of Nevada’s Institute for the Study of Gambling and Commercial Gaming, told The Times. “If you put a casino in a high-density population like Queens, you’ll do well.”

Competition from convenience casinos in Queens and Philadelphia is killing Atlantic City, where gambling revenues have dropped 36 percent, from a high of $5.2 billion in 2006 to $3.3 billion last year. Revenues are also down at Connecticut casinos. Last month, Mohegan Sun, the world’s largest casino, announced it would lay off 328 workers, blaming the Queens casino and a weak economy, according to The Times.

The success of the Queens casino undercuts the argument that the slots parlors attract tourists from outside the area. The Queens casino is supported mainly by repeat and problem gamblers. Many of those gamblers used to travel to Atlantic City or Connecticut once in a while, but now go to Queens several times a week.

So instead of attracting tourists, all the convenience casinos do is make it easier for local New Yorkers to gamble more often. At the same time, the casino is attracting customers who live in the area who never gambled before, but do now because the proximity of the casino. The upshot is likely an increase in problem gamblers. Studies also show an increase in crime, divorce, bankruptcy and suicide within a 50-mile radius of where casinos open.

As such, the Queens casino offers a taste of what is to come if New York goes forward with plans to legalize commerical casinos across the state. Instead of attracting new revenue to the state, the casinos will suck revenue from the pockets of residents by making it easier for them to gamble.

Maryland casino troubles

August 6, 2012 8:15 am

Maryland’s casino industry is just getting off the ground and already some lawmakers want to add more locations and table games. But one of the slots parlors is struggling in the face of competition.

The manager of the Hollywood Casino in Perryville asked the state to eliminate up to 500 video lottery terminals because it has lost 40 percent of its business since  Maryland Live! opened in June at Arundel Mills. The steep drop in business does not bode well for the Perryville casino, and is a sign the Maryland gambling market may not be able to support more casinos.

The move comes as Gov. Martin O’Malley has called a special session for lawmakers to add a sixth casino near Washington, D.C. and to add table games like blackjack and poker. Ironically, the owner of Maryland Live! – which is located in a suburban mall – is opposed to adding another casino, arguing the market is saturated. Indeed, all five of the casinos previously approved by lawmakers have yet to open, including a planned location in Baltimore. The early trouble in Perryville may indicate that gamblers in Maryland are tapped out.

Beach blanket bingo (and slots)

June 29, 2012 10:47 am

For everyone who can’t make it to the Jersey Shore for the July 4 holiday, the SugarHouse casino is throwing a beach party behind its slots joint on Delaware Avenue.

So instead of slots gamblers leaving kids locked in the car, they can leave them on the bank of the Delaware River in beautiful Fishtown. Who needs Atlantic City when gamblers can have sand and waterfront views of Camden and tanker ships going up the Delaware? (Just beware of the armed robbers.)

What a great way to celebrate the birth of the country, just a short ride from Independence Hall and the Liberty Bell. Maybe not. Read some of these reviews here from SugarHouse customers to get a sense of how scuzzy this casino is. Not to mention, leaving kids in cars is now illegal. SugarHouse can truck in sand, but a business dedicated to stripping wealthy from residents remains a net negative.

The state of gambling in America

June 26, 2012 9:23 am

As longtime opposition to gambling wanes, its popularity has increased as more and more states are getting hooked on the revenue from casinos and lotteries. As a result, gambling has turned into a $90 billion industry. The benefits of jobs and tax revenue have come to overshadow the economic and social costs that come from gambling.

That’s essentially the takeaway in an evenhanded report detailing the state of gambling in America released by CQ Researcher. (Read the full report here.)

The report asks if states are “hooked on money” from gambling? It provides lots of historical data and details on the explosion of gambling, as well the arguments for and against gambling. The report also shines a light on problem gambling and debates the impact of lotteries on the poor. Going forward, the report looks at the looming growth of online gambling and how that will exacerbate many issues. The report is an easy read and good industry overview that is recommended reading.

NY casino strikes gold

June 19, 2012 2:09 pm

The racino at the Aqueduct race track in Queens is taking in almost $2 million a day from gamblers. The average daily haul makes the New York casino the highest grossing slots joint in the country. (Since the racino is owned by Genting, much of the profits end up in Malaysia where the company is located.)

The Resorts World racino at Aqueduct generated $57.5 million in revenue in May, down slightly from the $59 million it made in March. However, the May figure surpassed the $55.4 million in revenue gamblers dumped in the slot machines at the Mohegan Sun casino in Connecticut. That made Resorts World the highest grossing casino in terms of slots revenue. That also means the casino is stripping nearly $2 million a day in wealth from the pockets of New Yorkers.

The racino’s success is due largely to its New York City location. It also underscores why Genting and other casino operators are salivating at the prospects of expanding or locating in New York. Resorts World currently only offers slot machines.

But Gov. Andrew Cuomo supports the expansion to full-blown casinos, which would likely attract even more gamblers. That explains Genting’s huge financial support for a nonprofit with close ties to Cuomo. The New York Times recently reported that Genting gave $400,000 to the nonprofit advocacy group called the Committee to Save New York. While that figure may seem like a lot it is less than one day’s haul from the slots in Aqueduct.

In addition to Genting, unknown gambling interests gave another $2 million to the Committee to Save New York. The donations poured in just as Cuomo ramped up his support for legalizing casinos in New York. The idea for casinos reportedly came during a fundraiser for Cuomo in Westchester. (See the excellent Times editorial here calling for more sunlight on the gambling process.)

As a candidate for governor, Cuomo didn’t even mention casino as part of his policy initiatives. Now he is busy trying to change the state Constitution to allow casinos, a move that will generate increased social and economic costs across the state. The shift shows how the casino industry’s deep pockets are driving public policy in Albany.

More casinos for Maryland?

June 14, 2012 11:12 am

Even before the five new casinos in Maryland have had a chance to get up and running some lawmakers are jockeying to add a sixth casino and table games at the existing casinos.

Nothing like changing the rules of the game after the cards have been dealt.

Of course, that is nothing new. Pennsylvania initially proposed slot machines at racetracks to help the horse racing industry. That quickly morphed into freestanding slots barns across the state, which then morphed into full-blown casinos with table games, like craps and poker.

Maryland seems to be following the same path. That’s how the casino industry works. Once it gets its foot in the door, it keeps upping the ante. Despite fears of saturation in Maryland, one study commissioned by the state found – no surprise – that there is room for another casino and table games at the five existing casinos. Consultants are famous for getting any desired answer.

Of course, Maryland lawmakers view gambling as a way to plug its budget holes. But casinos have shown not to be the answer in other states. The key to more gambling in Maryland rests with Gov. Martin O’Malley. He wants to broker a deal and move on and eventually up to higher political aspirations such as the White House. Adding full-blown casinos will give O’Mally the not-so-proud distinction in history as being Maryland’s Godfather of Gambling.

 

Whitney Houston’s daughter shines light on underage gambling

May 22, 2012 11:42 am

The daughter of the late signer Whitney Houston was caught on tape gambling at the MGM Resort and Casino in Las Vegas over the weekend. One Problem: Houston’s daughter, Bobbi Kristina Brown, is only 19 years old. Casino gamblers must be 21.

MGM is launching an investigation. Don’t expect much to come from that. Casinos do a lousy job of policing underage gamblers, and instead just view any fines as a cost of doing business. A Pittsburgh casino was fined $150,000 for repeated violations, involving underag gamblers. Other Pennsylvania casinos have been fined as well. An Atlantic City casino was fined for allowing a 14-year-old boy to gamble.

These may seem like isolated incidents but the number of underage kids who gamble is a serious and growing problem. As more states legalize casinos and push on line One study found one out of every five young people has a serious gambling-related problem, up from one out of every ten in 1988. The study was completed by Durand F. Jacobs, a clinical professor of medicine at Loma Linda University Medical School in California, and can be found here.

Other more recent studies have found similar problems among teen gamblers, especially males, including one here by Johns Hopkins University. Gambling is also a problem on college campuses. A study of college students in Florida found 66 percent of students said they gambled at least once in the past year. Another study found the percentage of college study with gambling problems was double the national average.

The problem is likely to grow as more states and the federal government look get into online gambling. One study found this could have the most dramatic effect on Internet-savvy underage gamblers. “The potential for future problems among youth is high, especially among a generation of young people who have grown up with videogames, computers, and the Internet,” the study found.

The looming casino glut

May 17, 2012 1:22 pm

Casino operators are shameless.

Maryland casino operator David Cordish is a few weeks away from opening his slots barn and already he is complaining about the saturation in the gambling market and the high tax rate on gambling in his state. He sounds like the resident who buys a McMansion and then opposes any further development because of traffic concerns and the impact of suburban sprawl on the environment.

Cordish’s company is opening a $500 million gambling hall on June 6 with 4,750 slot machines near a mall in Anne Arundel County. But he is already warning that the casino expansion can’t go on forever. Cordish is right, of course, but his timing is breathtaking. He blamed the expansion on lawmakers’ unquenchable thirst for tax revenue.

“I don’t know how we can control the politicians; they certainly don’t understand the word ‘over-saturation,’ “ Cordish said. “They think you can have casinos like Starbucks.”

The Baltimore developer is right about that as well, but fails to mention the government’s willing partners in the gambling industry who will open a casino wherever they can. It takes two to strip wealth from residents, many of whom are unsophisticated, elderly and/or struggling to make ends meet. Then again Cordish is not afraid to blame others for any troubles or rush in to court when needed, as seen in this piece about a recent legal dispute.

While other casino operators lament the competition the piece goes on to talk about plans to casinos in a number of other markets. At some point the casino bubble will pop. For now, the casino operators will keep rolling the dice.