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Gaming Guru

Joe Weinert
 

Atlantic City Roundup

28 May 2003

ATLANTIC CITY -- Growing concerned that proposed hikes in gaming taxes have yet to die, the Atlantic City casino industry has begun a verbal attack on New Jersey Gov. James McGreevey.

State Sen. Bill Gormley, the industry's staunchest ally in the statehouse, began with a blistering opening speech at the Mid-Atlantic Gaming Congress in Atlantic City. He accused the McGreevey administration of being poll-driven, indifferent toward southern New Jersey and of causing a potential "malaise" in Atlantic City.

"If we have a governor who talks about it, who keeps bringing it up, it's what leads to that malaise," Gormley said. "So long as he puts out the possibility, the potential, he takes away what we've had over the last 15 years -- stability."

Gormley referred state Labor Commissioner Albert Kroll, who gave the conference keynote speech, of being the "commissioner of unemployment" and said McGreevey's tax hikes were the result of "the ill advice of a treasurer (John McCormac) who also does not understand southern New Jersey and does not understand New Jersey."

McGreevey, meanwhile, signaled that he's more determined than ever to implement the gaming taxes.

"We all know the odds are stacked in the casinos' favor when we walk in the door and now they want the taxpayers to take money out of our schools and our roads and force taxpayers to subsidize their profits, which are growing every year, even though their taxes haven't gone up in 25 years," said the governor's communications director, Kathleen Ellis.

"We think the people of New Jersey, both north and south, want the casino industry to pay its fair share and that's all we're proposing. That's all we want, for people to think about it," she said.

McGreevey wants to hike the casino-revenue tax to 10 percent from 8 percent, impose the 6 percent sales tax on casino complimentaries and create a 7 percent lodging tax.

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The Casino Association of New Jersey launched a hard-hitting radio campaign to sway public opinion against McGreevey's proposed casino taxes.

"Sure, go ahead and devastate the major employer in South Jersey -- the one that supports 50,000 workers and their families. The one on which 14,000 businesses depend for their livelihood," says a man in one of the radio spots.

"Boy, he must really hate South Jersey," says a woman in the other spot.

The casino association began the month-long radio campaign last week. It's airing on 16 radio stations in southern New Jersey and three in Philadelphia.

"We are taking to the airwaves to call attention to the short-sighted and counter-productive nature of the McGreevey tax plan," association President Dennis Gomes said.

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Twenty-five years after singer Steve Lawrence rolled the dice to open the first legal casino outside of Nevada, former New Jersey Gov. Brendan Byrne re-enacted the scene to celebrate Atlantic City's silver anniversary of gaming.

Byrne, 79, was governor during the 1976 statewide referendum that legalized casinos in Atlantic City and he was there when Resorts opened on May 26, 1978. Officials wanted him to roll the first dice then, too.

"I was governor then and I thought it was inappropriate because we really hadn't established that casino gambling could be an honorable profession. It is now and I was happy to roll the dice," Byrne said.

He rolled an eight and then sevened-out, losing a nickel wager he had playfully placed on the green felt.

Atlantic City has been much luckier. This month it surpassed $70 billion in winnings since Resorts opened. The 11 casinos now generate more than $4.2 billion annually.

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Showboat formally opened its $90 million, 544-room hotel tower, making it the third-largest hotel in the city at 1,309 rooms.

"We had a very big casino with lots of great restaurants, but too few rooms. If anything, we waited too long to add these rooms," said Gary Loveman, chief executive of Showboat parent Harrah's Entertainment.

The new rooms measure 420 square feet, each with a 32-inch television, a refrigerator and an enhanced version of Sealy's best mattress.

Harrah's Entertainment has spent more than $230 in capital improvements at Showboat since 2001.

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Bally's Atlantic City paid $20,000 to the Casino Control Commission to settle charges that it allowed a 15-year-old girl to play nickel slots two years ago. The casino has paid $107,000 in underage-gambling fines since 1987.

Trump Plaza paid $10,000 to settle charges that it allowed a 20-year-old woman to play quarter slots in March. The casino has paid $71,000 in underage-gambling fines and required charitable contributions since 1988.

(Joe Weinert covers the gaming industry for The Press of Atlantic City. He can be reached at jweinert@pressofac.com.