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Gaming Guru

Joe Weinert
 

Atlantic City Roundup

1 December 2003

ATLANTIC CITY -- When it comes to the possibility of legalizing racetrack slots in New Jersey, Atlantic City casinos are taking the position of, If you can't beat 'em, pay 'em off.

Casino executives are working with Gov. James McGreevey, legislators and a state agency that owns two tracks on a casino-funded plan to boost racing purses. In exchange, tracks would not push for slots and casinos would get incentives to build more hotel rooms.

Although several ideas are being discussed, one source said casinos are looking at an annual payment to the horse-racing industry of between $10 million and $12 million per year.

"Every other state is doing something for the horse-racing industry. We can do this without hurting the (casino) industry," said David Jonas, senior vice president of Atlantic City operations for Harrah's Entertainment. "The stuff we're talking about would not take a dime out of our pockets."

New Jersey's three racetracks are pressing for the state's help as tracks in surrounding states use or plan to use slots to boost racing purses. West Virginia and Delaware tracks began operating slots in the mid-1990s, New York is scheduled to start this winter, and the legislatures in Pennsylvania, Maryland, Massachusetts and Ohio are considering them.

Jonas said dealing with racetrack slots is the new reality in state government and the gaming industry. Atlantic City casinos can either craft a workable plan or fight a losing battle, he said.

Casino executives are taking a different tack than they did early this year, when they vigorously attacked McGreevey for proposing a $135 million hike in casino taxes. The executives are hoping to strike a deal with legislators before February, when McGreevey will propose his fiscal year 2005 state budget.

"This gets us off the battlefield prior to February," one industry executive said.

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Donald Trump made good on his threat to sue a state agency that delivered a highway ramp four months late.

Trump Hotels & Casino Resorts sued the South Jersey Transportation Authority, claiming the agency was supposed to complete a ramp linking Borgata Hotel Casino & Spa to Trump Marina before the July 2 opening of Borgata. Trump executives routinely complained that Trump Marina lost business because motorists who visited Borgata had difficulty returning to Trump Marina.

Trump Hotels did not specify in its lawsuit the damages it seeks.

The SJTA said construction delays were caused by excessive rain that hampered efforts to compact soil. The agency said it will "vigorously" defend itself against Trump's claim.

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The wives of two men killed in the Tropicana Casino and Resort parking-garage collapsed filed suit, claiming the concrete subcontractor cut corners. The plaintiffs' attorney announced the lawsuit across the street from the project's general contractor, Keating Building Corp. of Philadelphia.

The 10-story, 2,400-space garage collapsed while under construction on Oct. 30. Four men were killed and 20 were injured. Authorities have not determined the cause.

The garage was part of Tropicana's $225 million parking, lodging, retail, dining and entertainment expansion that was scheduled to open in March. Tropicana officials cannot say when construction might resume nor when the expansion might open.

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Atlantic City's chief gaming competition reported mixed results last month.

The two huge Indian casinos in Connecticut, Foxwoods and Mohegan Sun, reported combined October slot revenue of $134.9 million, up 8.1 percent. They do not publicly report their table-games revenue.

In Delaware, the year-old state ban on smoking in public places resulted in the 11th straight month of revenue declines at the three racetracks. Delaware Park, Dover Downs and Harrington Raceway reported combined slot revenue of $38.9 million, down 9.5 percent for the four-week October reporting period.

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Authorities are searching for Virginia lawyer Robert Short after charging that he used Atlantic City casinos to launder $250,000 stolen from his law firm.

A state grand jury indictment alleges that on Feb. 21, Short wired $250,000 from a personal checking account to Trump Taj Mahal. He allegedly arrived at the Taj the next day and withdrew a $10,000 marker. Authorities said Short lost $1,000 at roulette, then withdrew the remaining $240,000. Taj officials, discovering that Short had no history at the casino, notified authorities of the suspicious transaction.

Authorities allege that Short, 37, stole $436,000 from his Fairfax County law firm.

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