Making the News

Philadelphia Inquirer

Originally Published:Friday, October 10, 2008

"Atlantic City is in for a challenging time for as long as the economy remains in a depressed state," said Joseph Weinert, senior vice president of the consulting firm Spectrum Gaming Group L.L.C., just outside of Atlantic City. "What this all boils down to is whether the casinos' customers feel good about maintaining their level of gambling expenditure.

"You see the answer in the monthly results," he said. "These monthly results can no longer be explained away by just Pennsylvania."

Delay of casino smoking ban just in time

By Suzette Parmley
Philadelphia Inquirer

ATLANTIC CITY - This seaside resort is facing its biggest crisis in the 30 years since it gambled its future on casinos.

The casinos that provide the crowds and the luster for this old town will report their September revenues today, and it is expected that the numbers will be a staggering 15 percent lower than the revenues of September 2007.

If so, the drop-off would be the largest non-weather-related slump since casino resorts were built here.

And it could get much worse.

Atlantic City's City Council voted narrowly Wednesday night to delay a complete ban on smoking in the casinos. They did so because powerful casino operators and even some casino employees eager for a smoke-free and healthier workplace joined politicians in ice-cold terror that the ban would drop revenues even more, perhaps as much as 30 percent in total.

Those numbers would almost assuredly result in major layoffs.

"It's ugly," said a grim-faced Mark Juliano, chief operating officer of Trump Entertainment Resorts Inc., which owns Trump Plaza, Trump Taj Mahal, and Trump Marina here, after he testified Wednesday before City Council for a one-year delay of the smoking ban.

The ban is scheduled to take effect Wednesday. But it could last only a week, as the Council holds a final vote on the matter Oct. 22. If the votes hold to delay the ban, the Council could repeal the ban that night.

A host of trouble threatens Atlantic City. Casino slot gambling in Pennsylvania is attracting many players who were steady Atlantic City customers.

High gasoline prices do not help, as some prefer not to drive to the resort, but choose instead to gamble closer to home.

Fears from the economic collapse cut further into business.

The credit markets have tanked, and with them the hopes of some developers who wanted to build four supersize casino resorts in Atlantic City by 2012 to keep it competitive.

At least one company, Pinnacle Entertainment Inc., of Las Vegas, announced earlier this year that it had postponed indefinitely its plans for a $1.5 billion gambling palace where the former Sands Hotel Casino stood on the Boardwalk. Pinnacle blamed its inability to get financing, and the land where the Sands once stood remains undeveloped.

"Atlantic City is in for a challenging time for as long as the economy remains in a depressed state," said Joseph Weinert, senior vice president of the consulting firm Spectrum Gaming Group L.L.C., just outside of Atlantic City. "What this all boils down to is whether the casinos' customers feel good about maintaining their level of gambling expenditure.

"You see the answer in the monthly results," he said. "These monthly results can no longer be explained away by just Pennsylvania."

The anger that spilled outside Atlantic City's Council chambers and into the hallway Wednesday night after the council voted, 5-4, to delay the smoking ban showed just how deep the economy had divided casino workers, who only six months ago showed a united front.

In April, the City Council had voted unanimously for the ban.

Councilman Dennis Mason, who represents the Fifth Ward, summed up his change of heart. "After hearing all these layoff numbers and things like that, I'm not going to be getting these calls at my house and at my office to try to get these people jobs," he said. "They might be against smoking, but if they're not there, what difference would it make?

"I don't want anybody losing their jobs," said Mason, who had sponsored a partial smoking ban that allowed for smoking in one-fourth of the casino floors.

Nate Chait, 53, a table-games supervisor at Caesars, was elated when Mayor Scott Evans signed the full smoking-ban ordinance into law April 30. He celebrated with his dealer comrades over drinks that night.

Chait said this week's development was "totally unexpected."

"We are really angry as far as worker-health rights," he said. "The casinos that are calling for another year act like we should be treated differently than the rest of the workers of New Jersey, and it's very frustrating."

After Wednesday's vote, health advocates who had teamed up with casino workers, like Chait, to get the full smoking ban passed last spring were somber.

"It's disappointing that the casino industry took the opportunity to prey on the economic fears of the public," said Michele Gallagher of the American Cancer Society. "Nonsmokers exposed to secondhand smoke at home or work increase their risks of developing lung cancer by 20 or 30 percent."

But at least one nonsmoker, Isabel Rogers, 78, of Washington, could feel Atlantic City's pain.

"They don't want [the ban] right now because of the economy, and that's OK," the retired registered nurse said as she played a nickel slot machine Wednesday night in a nonsmoking area of Resorts casino.

"They're telling the truth," she said of panicky casino operators. "Look around, it's empty.

"I play 'til 3 a.m. in the morning, and I can jump from table to table."

 


Contact staff writer SuzetteParmley at 215-854-2594 or sparmley@phillynews.com.