On November 8th, New Jersey voters will get the chance to weigh in on a referendum that would allow casinos to exist outside of Atlantic City, namely in North Jersey. At this juncture, the approval would be for only two locations.
Residents of New Jersey first voted on legalized casino gambling back in 1974 and it was voted down. When the idea was presented again in 1976, the measure was passed and the first casino opened its doors in 1978. Since that time, Atlantic City has held a monopoly on casino gambling in the state. This time around voters seem to be split almost evenly on the efforts to expand beyond Atlantic City. The latest polls put the residents at 46% against and 44% for the proposal.
BIG MONEY BACKERS
In the year or so leading up to this vote, some rich and powerful people have been putting big money into lobbyist groups in order to ensure the vote passes in November. Lobbyist groups in the state, some straight off the top ten list (Optimus Partners and Public Strategies Impact), have received large contributions from among others, existing NJ casinos, real estate developers and labor groups. Steve Wynn, a former Atlantic City casino owner, is throwing some money into the effort and has expressed interest in opening a casino in North Jersey.
Real estate developer, Jeff Gural,of the Meadowlands Complex, thinks he has the best and most obvious choice for a North Jersey casino. He has backing from Hard Rock Casinos who stated their company is agreeable to putting a casino in the Meadowlands. Gural has just sunk $100 million into improvements and additions at the complex.
Paul Fireman, a Nevada ranch owner and businessman credited with Reebok’s turnaround, made a contribution to Govern Christie’s (NJ) super PAC in favor of the referendum. Fireman has shown interest in building a casino and motor sports complex in New Jersey with an estimated cost of over $4 million.
The benefits of expansion include the obvious creation of jobs and trickle-down effect to other businesses in the state. An estimated $400 million in revenue is another plus on the side of the supporters. There is a plan to allocate $200 million of that revenue to Atlantic City in order to compensate for anticipated loss of business.
An additional two percent of the income would go to programs and to tax relief efforts for the disabled and senior citizens. There are also provisions to give a portion to the struggling horse racing industry and the municipalities where the casinos will be located. The exact location of the two proposed casinos has yet to be decided.
Atlantic City casino owners would be given first chance to get in on licenses for new casinos, but would have to apply during a limited time period to take advantage otherwise, it’s anyone’s game.
There is concern that Atlantic City would suffer additional losses due to competition from in and out of state, especially since there are an estimated 8 new casinos are being proposed along the northeast. Also, the city is suffering from big financial troubles and the state is currently investigating a need to take over the ailing city. To some, this is proof of the lack of success of casinos in New Jersey.
Some politicians are in disagreement over the distribution of the revenue monies. Detractors think the funds should not go to Atlantic City, but instead should be divided among more pressing interests such as pensions or transportation.
As many are spending huge amounts of money to support the vote, there are others, in and out of the state, looking to stop it by hiring their own lobbyists. A few Atlantic City casino owners and out of state casino operators are looking to limit competition and stop the industry from being flooded and causing losses across the board for all.
At this point, it’s anyone’s game, and the voters hold all the cards. Until November, residents should expect big moves from both sides that are hoping they bet on the right hand.