Making the News

Atlanta Business Chronicle

Originally Published:Friday, August 17, 2007

Michael Pollock, managing director of a leading gaming consultancy, said he wouldn't call it a "frenzy.

It's a clear growth curve that is more than 15 years old," said Pollock, of Spectrum Gaming Group in Atlantic City, N.J.

Atlanta's rivals pondering casinos
Boston, Chicago, Philly may roll the dice

By Rachel Tobin Ramos
Atlanta Business Chronicle

As Atlanta continues to cling to its No. 5 rank among the top tier of convention cities, some of its competitors are betting that adding gambling will shore up tourist numbers and fill tax coffers.

In July alone, six states faced referendums, legislative action or awaited decisions by governors or courts on casinos, including Illinois, Kansas, Kentucky, Michigan, Massachusetts and Pennsylvania.

While no casino has yet been proposed for Atlanta, it's a solution that's on the tip of the tongues of many city boosters.

Central Atlanta Progress President A.J. Robinson has made it clear that he wants to study the idea of casino gaming for Atlanta's central business district. And a group of business leaders already sponsored a study by Atlanta's PKF Hospitality Inc. that said just one downtown Atlanta casino could generate a $1.7 billion economic punch, contributing $135.3 million in taxes.

In Boston, the seventh-ranked U.S. convention city for smaller meetings according to Tradeshow Week Magazine, Democratic Massachusetts Gov. Deval Patrick, the former top lawyer at The Coca Cola Co., is poised to make a decision on gambling by Labor Day.

The Windy City is looking at gaming too. The Illinois legislature is mulling a casino for the city of Chicago, the No. 3 ranked convention city for large meetings.

That state already has riverboat casinos, but not in the large convention destination.

And in Philadelphia, the Pennsylvania Supreme Court has overturned a challenge to two riverfront casinos, clearing the way for gaming in the City of Brotherly Love.

Voters in Wichita, Kan., just rejected a casino in Sedgwick County. But Sumner County voters already approved a casino.

In Kentucky, the topic of casino gambling is dominating the governor's race.

The Democratic challenger thinks the state should have gaming, while the Republican incumbent has said he won't allow gambling "on his watch."

A July 26 editorial written by The Boston Globe sums up the situation concisely: "Americans have voted with their feet for the notion that casinos are an acceptable, even desirable part of the U.S. leisure industry."

And as more cities and states struggle to pave roads, pay for cops and schools, and keep up with the needs of their populations, casino tax money is as enticing as hitting the jackpot.

Says the Boston Globe editorial: "The evident demand for casino gambling in this state coincides with calls for more state aid to support education, public safety and public works in the state's 351 cities and towns."

Patrick's spokeswoman, Cyndi Roy, says Massachusetts already has the lottery and bingo, and the governor now will decide on "whether or not gaming should go forward."

As the Boston Globe editorial reports, Massachusetts residents spent more than $800 million at the Foxwoods and Mohegan Sun casinos last year, of which $100 million went into the Connecticut treasury.

Similarly, in Georgia, 1.5 million Peach State residents take their money and gamble elsewhere each year.

The Globe editorial board admitted it "has opposed proposals for casinos in Massachusetts in the past," but "as public attitudes and the state's needs have evolved, so has this page's view of casinos."

Common arguments against casinos include fears about increased crime resulting in decreased property values, plus an epidemic of problem gambling.

Although there is evidence to support those claims, the benefits are also obvious to some. Tax revenue is expected to increase as more tourists stay longer and spend more money. The creation of a potentially glitzy entertainment district around a casino
could be a big draw.
"We do most of our meetings outside Atlanta," said Kenneth Jones, past president of Meeting Professionals International's Georgia chapter and managing director of dynami group, a meetings and incentives company.

"Our clients are always looking for a snazzy, happening location that has a lot to offer in close proximity to their hotel. Atlanta was lower down on that list."

He said downtown's newest attractions have helped yank Atlanta up a few notches, and he now has clients interested in trying Atlanta.

Nonetheless, he said, "I'd be a huge advocate for a casino in downtown Atlanta."

To some, the national interest in casinos might look like a free-for-all.

But Michael Pollock, managing director of a leading gaming consultancy, said he wouldn't call it a "frenzy."

"It's a clear growth curve that is more than 15 years old," said Pollock, of Spectrum Gaming Group in Atlantic City, N.J.

"Interest tends to increase when there are budget deficits and also when there are racetracks in need of help, which is virtually every racetrack," he said.

For many cities and states, he said, casinos don't make sense.

But for convention towns, when business travelers fill hotels midweek, casinos can be the magic trick for high occupancies on the weekends.

"We believe that over time, cities that have major convention components to their tourist economy are going to increasingly look to gaming," Pollock said.

Casinos also make conventioneers feel like they get more "value for the dollar," he said. While it's not cheap to hold a meeting in Las Vegas, the entertainment, restaurants and shopping "is a lot for your money," in terms of room rate.

Pollock added that if Atlanta and Georgia decide, from a public policy standpoint, to allow casino gambling, it must be "fully integrated into the tourism infrastructure."

A suburban casino, he said, wouldn't dovetail as nicely with the meetings industry. Pollock's final advice for Atlanta: try to get it right, because there are "no second chances."

The case for casinos

States with referendums, legislation or awaiting decisions by governors or courts on casinos:

1) Illinois
2) Kansas
3) Kentucky
4) Michigan
5) Massachusetts
6) Pennsylvania

Reach Ramos at rramos@bizjournals.com.

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