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Gaming Guru

Rod Smith
 

Column Inside Gaming: Nevada Becomes Poster Boy, Proliferation DOA

9 June 2003

Nevada has become the poster boy for killing the proliferation of casinos. Gaming critic Tom Grey, executive director of the National Coalition Against Legalized Gambling, says the key for voters has been the argument that if gaming is an easy fix, Nevada should have a surplus instead of leading the nation in tax increases to balance the budget. "Voters are calling their reps, saying 'look at the mess in Nevada,' " he says.

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California Gov. Gray Davis may be lucky to get a nickel out of tribal casinos. Sources say tribes have amassed too much political clout for the governor to raise big bucks. Davis has started talks to expand Class III gaming, but he's stymied by tribes. It seems that tribal interests have balked at recent proposals and Davis has lowered the amount he seeks from tribes to $600 million, compared with $1.5 billion just a few months ago.

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Wall Street, on the other hand, could be getting billions out of American Indians, four centuries after they sold Manhattan for a bunch of beads. Tribes have proposed projects worth billions that could spell a new niche for the high-yield bond market. The tax-exempt market could see up to $1 billion in Indian casino bonds a year, analysts say. For the gaming industry, the bonds would represent added competition for very limited dollars.

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Talk is heating up among industry insiders that a local operator may get into the competition to take over the Aladdin. The big local operators just don't think they need competition from Robert Earl's Planet Hollywood group, the leading candidate to take out the Aladdin, or one of the other out-of-town bidders now in the fray. The problem is, the Aladdin doesn't seem to fit any of their strategies and there's little reason to think it would work out better than it did for the original owners. So who will step up to the plate -- in a defensive posture?

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Sources in Atlantic City say the Borgata is taking hotel and restaurant reservations for July 11 and beyond. Some said the $1.1 billion Borgata might even open earlier than that date but not before July 1. Callers were quoted room rates of $179 for midweek and $249 for weekends for standard rooms. Borgata has also revealed its summer entertainment schedule, which as of now begins with a two-night stand from comedian David Spade July 12 and 13. The first big musical act is Hootie & The Blowfish on July 27. Still, no official word on an opening date.

The Inside Gaming column is compiled by Gaming Wire Editor Rod Smith. You can contact him by phone at (702) 477-3893, fax (702) 387-5243 or e-mail at rsmith@reviewjournal.com.