David Mckee's Stiffs & Georges - Tribal

Case Bets: Net bets, Mohegan Sun & What's F'bleau worth?

Tue, 13 Oct 2009 12:46:00 -0700

You can't play poker for money on the Internet but you can now play the ponies in Illinois via the Web. This is yet another example of legally enshrined hypocrisy under UIGEA, the parting gift of "Slick Billy" Frist and Jim Leach to the American people. (Speaking of Dr. Frist, M.D., if we must, he just sat like a bump on a log when Bill Maher stupidly railed against the swine-flu vaccine last week. Thanks, doc.)

Setting Sun? The incoming chief of the Mohegan tribe is saying the right things about the imminent need for diversification. Specifics, however, are few on the ground. Mohegan Sun, meanwhile, finds itself between several rocks and hard places: potential competition from Massachusetts and Long Island, $1 billion in debt, falling revenues and the economic inability to finish planned improvements. Depending on how quickly Massachusetts gets its act together, Mohegan's moment in the sun could soon pass.

You've heard of "pocket pool," now the Review-Journal's intrepid Howard Stutz reaches deep into the demimonde of PocketCasino, the new, portable sports-betting technology in play at Venetian/Palazzo. No word yet on whether excessive play causes blindness or hair growth on one's palms.

(Seriously, as a longtime skeptic of Cantor Gaming's portable-gambling applications, I have to say it looks like the Cantor boys have come up aces this time. As for handheld substitutes for table games, the jury is still out on that, four years after their legalization.)

Fontainebleau Las Vegas from Running Bull Productions on Vimeo.

Pennies for F'bleau. What's Fontainebleau worth? Jack shit, according to Penn National Gaming (aka, 15 cents on the dollar). In return, Penn is willing to accept a 10% return on investment ... provided it can bring the project in a no more than $1.5 billion (not counting the billions already spent and written off).

This remains an iffy proposition, in part because it's predicated on increased profitability at Penn's patchwork assemblage of casino properties. Those have to be welded into a Harrah's Entertainment-like loyalty program that drives visitors to Las Vegas. This is a huge "if," as Penn currently has no casinos in major destination markets, unless you stretch that to include recently singed Empress Joliet. Bringing customers to Vegas or even Atlantic City is terra icongnita for Penn.

To put it bluntly, Penn was a third-tier operator -- mainly of racinos -- that "married up" by taking over Argosy Gaming, the classiest of the riverboat operators. However, the Vegas market is notoriously unforgiving of new-to-town operators and Penn will have a very steep learning curve. Also, Penn is not associated with upscale properties, so F'bleau will either have to be repriced downward to reflect the Penn customer base or may need to offer promotional allowances up the ying-yang (more likely both).

If that weren't sufficient cause for concern, Penn's oft-brandished $1.5 billion (the breakup fee from an ill-advised and abortive LBO) is covering multiple bets. Penn is the primary mover behind a pro-casino ballot initiative in Ohio -- partly to protect its Hollywood Lawrenceburg investment just across the border in Indiana. It also recently bought out Cordish Gaming in hopes of getting piggybacked onto the Kansas Speedway casino license, should the Sunflower State's lottery board approve.

At least Penn is working on ways to trim the completion price of F'bleau. Costs to date -- and projected ROI -- being what they are, it behooves Penn CEO Peter Carlino to get this rampaging beast under some semblance of control.

Leaving Las Vegas

Mon, 12 Oct 2009 18:17:00 -0700

At least 28,000 have done so over the two years-plus (probably more when you allow for the people still moving here). What are the likely consequences of Las Vegas' pegging its future on a one-trick economy? And is it going to be like one of those Rust Belt cities (like Pittsburgh) that turned it around or one of those (say, Detroit) that continues to decline?

Those questions and others are posed in a splendid article that connects most of the dots regarding Vegas' economic plight. One of the most disturbing points raised by Las Vegas Sun reporter J. Patrick Coolican is that cities doing well at present tend to be ones that possessed robust institutions of higher learning -- and invested in them. Neither can be said of Nevada's dismal education system, the recipient of savage budgets, thanks to our governor and the ever-feckless Lege.

If Las Vegas' future hinges on well-funded and -respected academic institutions, then the near-term prognosis is grim.

Speaking of Detroit, casino owners and politicians there may be casting a wary eye on rising pro-casino sentiment in Ohio. In whichever form casino gambling is legalized by Buckeye State voters, it stands to take a big bite out of Motown casino receipts -- and sap state and local revenue collection, too. A helpful Detroit News map shows precisely which Detroit, Indiana, Pennsylvania and West Virginia casino operators have reason to be fretful about the emergence of a casino industry next door.

Like their Strip brethren, tribal powerhouses Mohegan Sun and Foxwoods Resort Casino went all-in ... into debt, that is. Now that it's time to pay the piper, they find themselves in binds comparable to those facing non-tribal casinos. However, they have fewer options for relief, as they discover the downside of being a tribal operation.

Dog's breakfast at Tiffany's. Few readers of this column can probably afford to buy anything at the Tiffany mega-boutique that will be part of the Crystals mall at CityCenter. However, it will make for some lovely window-shopping. (Click on the pictures to see them in a larger size.)

Atlantic City reprieve. Although New Jersey's three-way gubernatorial race is up for grabs, casino owners can take one consolation. Whichever of the two leading candidates is elected, continued opposition to racinos is promised.

East Coast antics

Mon, 12 Oct 2009 13:55:00 -0700

Wrong again. There I was, thinking the proposed $10 million upfront fee for table games in Pennsylvania was a done deal when the GOP-controlled state Senate upped it to $15 million (and if you don't pay by June 1, it goes to $20 million). Chalk that up as a "loss" for casino owners.

The latter did, more or less, get what they wanted on taxes, where they'll pay an aggregate state/local rate of 14%. Despite publicly requesting a 34% tax rate, Dems in the lower house are muttering that one in the "high teens" might be acceptable. The question is: In return for what?

Casinos also banked a "win" when the state Senate ashcanned an amendment that would have tripled the slot base at "resort" casinos. Since this amounted to preferential treatment for a tiny percentage of the Keystone State casino industry, it's good to see it get the back of Lege's hand.

Power play in New York. In the competition for the racino contract at Aqueduct Race Track, those in the hunt include MGM Mirage, Penn National Gaming, Harrah's Entertainment and Seminole Tribe-owned Hard Rock Entertainment, along with numerous and sundry joint-venture partners.

But none of the seems to have the juice of Larry J. Woolf's Navegante Group. After the New York Lottery Division had deemed Aqueduct Entertainment Group (in which Navegante is a partner) unqualified, Gov. David Patterson's underlings put the word out that the five-member consortium is indeed qualified. Somebody in Aqueduct Entertainment's got pull, that's for sure.

A win for Adelson. While no casino company was remotely near the top of Newsweek's ranking of the 500 greenest companies, Las Vegas Sands can claim a victory of sorts. Sheldon Adelson's firm clocks in at #128, well ahead of MGM Mirage (#164) and Wynn Resorts (#176). Given the extent to which MGM has publicized its green-friendly initiatives, particularly with regard to CityCenter, finishing so far behind LV Sands is tantamount to a smackdown by proxy.

Several years after the publication of Beneath the Neon (now available in e-book format) publications are still shocked -- shocked! -- to learn of Las Vegas' large (and growing) subterranean community. Alas, we no longer have the Hooverville that had sprouted about a half-block north of LVA HQ. Those hobos were a tidy bunch and made our street seem halfway populated.

Marie Osmond pix. I'm just sayin'.

Stanley Ho: I'm not dead yet!

Fri, 09 Oct 2009 13:15:00 -0700

Either rumors of Stanley Ho's death, three weeks ago, were greatly exaggerated or the elderly casino magnate has made the most remarkable recovery since Jesus Christ. (I'm put in mind of a favorite bit of Babylon 5 dialogue in which Capt. Sheridan [Bruce Boxleitner] confirms that he indeed died, adding, "I'm better now.")

Today, Bloomberg News reports Lawrence Ho says dear old Dad is "looking better every day" and making a good recovery from -- as best we can conjecture via published reports -- a subdural hematoma brought on by a nasty fall. The younger Ho says his father's SJM has no plan of succession in place. Boy, when the Grim Reaper eventually comes for old Stan, the fight for control is going to make King Lear look like a tea party.

A compromise is shaping up in the Pennsylvania table-games wrangle and casinos won't like it one bit. According to J.P. Morgan summary, while the Dems in the lower house haven't budged off their preferred $20 million upfront fee/34% tax equation, the GOP-led state Senate has blinked.

The Senate's proposal would set the license fee at $15 million (a 50% increase) and the taxes at 14%, up from 12%. Casinos might be able to swallow that, on the presumption that the tax increase is small and the extra $5 million in fees can be quickly recouped. Even at $20 million, a bigger upfront hit can be regained by operators off the back end -- provided that the tax rate stays relatively low. Doubtless that's the lesser of two evils, from their perspective.

Bluhm: $45 million saved is $45 million earned.

On the money-saving front, the budget for the initial version of Neil Bluhm's SugarHouse casino is now announced at $310 million: a -$45 million shift. Considering that Bluhm's Rivers Casino and Sheldon Adelson's Sands Bethlehem came in at a staggering $1.5 billion-plus (combined), this new dollar figure suggests a welcome return to fiscal restraint. Your turn, Foxwoods.

What's a Trump casino worth?

Thu, 08 Oct 2009 15:07:00 -0700

Only $14 million in cash (plus a $100 million equity infusion), according to The Donald. Bondholders say, we'll see your $115 million and raise you $100 million. The latter would recoup at least some -- but not very much -- of their $1.25 billion debt under their plan, while Das Trump would send them away virtually empty-handed. (Moral: When Donald Trump asks you for a loan, take a page from Nancy Reagan and Just Say No.)

The bondholders' assignment of a $75 million valuation to Trump Marina seems awfully optimistic for what is, in essence, a corpse that can't be sold. In essence, the real value proposition is resurgent Trump Taj Mahal, with the other two casinos scarcely better than throw-ins. The Marina is, if anything, an albatross around the company's neck. Still, given that CEO Mark Juliano is going to exceptional lengths to champion the Trumpster's bid, which is a big "screw you" to the debtholders, here's hoping Judge Judith H. Wizmur holds firm for a more responsible solution.

Ho: No! "I don't see major resorts opening for the next couple of years now," says Lawrence Ho. thereby raining pessimism on the expansion plans of Las Vegas Sands, Wynn Resorts and Galaxy Entertainment. The younger Ho also speculates upon the Chinese government's motivation for throttling, then somewhat relenting upon travel to Macao. Interesting tidbit: Marketwatch.com reports that "Venetian Sands" [sic] has cut its number of table games by 25%.

Nevada revenues in. And yeah, they suck. They're much less sucky than usual (-9%), showing an upward trend in baccarat plus two locals-oriented bright spots in the form of Aliante Station and M Resort. It's unclear, though, how much of the growth generated by the last two is new business vs. redistribution of dollars from elsewhere in the valley. The Sun's analysis is far more informative than that found in the R-J.

Wait 'til next year. That's the timeline for casinos in Massachusetts. Even though western Mass looks like slim pickings, lawmakers will probably have to put a casino there just to get the bill onto the floor.

Penn bid falls. Lenders to bankrupt Fontainebleau won a small victory or two, as the judge overseeing the case seems determined to keep lead developer Jeffrey Soffer as far from the disposition of F'bleau as possible. (Soffer is both a debtor and creditor on the project.)

F'bleau, for its part, revealed that Penn National Gaming's offer is now "substantially less" than $300 million, but would include money to replace the windows that are reportedly falling off the building. (One more reason not to build a Strip megaresort tower flush against the "pedestrian realm.")

Groundbreaking today for the long-awaited SugarHouse casino in Philadelphia, under the shadow of a stick-it-to-SugarHouse tax that's been proposed in the Lege. Table games, meanwhile, might be off the table in the face of a $200 million lawsuit. You see, non-racino casinos are allowed to have 5,000 slots (in return for a $50 million fee). Small "resort" casinos -- known as "Category 3" -- only have to $5 million and get 500 slots (accessible only to guests). That's proportional, obviously, and seems fair.

However ... lawmakers want to tilt the playing field by giving Category 3 casinos 30% as many slots as, say, Rivers Casino or SugarHouse, instead of 10% ... and open those games to the general public, not just guests. Of course, the state can't go to the one existing Category 3 casino and ask for another $10 million -- can it? Casino operators are also solidly behind the GOP position on table games: $10 million upfront plus a 12% tax. But, unless House Dems completely capitulate, the gaming bosses are unlikely to get what they want, at least where the tax rate is concerned.

Penn whiffs again. Although Penn Nat'l was supposed to be a bidder in the bankruptcy auction for the Lone Star Park racino, it evidently didn't get into the action and the track went to the Chickasaw Nation for $27 million. (A lot less than Harrah's Entertainment paid to get into Ohio.)

Which means that if/when gambling is legitimized in Texas, the Chickasaws will have a double advantage (parimutuel + tribal status), while Penn will be looking at yet another missed opportunity. Penn's corporate strategy is a baffling alternation of rashness and hyper-caution.

In other tribal news, much-criticized National Indian Gaming Commission Chairman Phil Hogen is gone, thank God, and with him his new, more-restrictive Class II rules. Hogen was justly pilloried for attempting a rollback of hard-won gains in what games tribes could offer. His new rules reflected Bush administration paternalism toward tribes and while they're officially postponed for a year, I think it's safe to say they're dead.* No wonder Rep. Dan Boren (D-OK) is smiling. Watch out for that doorknob, Mister (Ex-)Chairman.

(* It's probable the same thing would have happened under a President McCain, as either candidate would have brought a more enlightened attitude to D.C.-tribal relationships.)

Supporters of video gambling are starting to push back in Illinois, at least in rural, conservative McHenry County. So far it's been the urban areas where this expansion of gambling hasn't been gaining traction.

A repeal of UIGEA continues to gain ground in the House of Representatives, even if it got pulled off the floor in the Senate. (Thanks for nothing, Harry Reid.) The money quote, literally, is a reference to an amendment Rep. Jim McDermott (D-WA) which would would specify that "corporate taxes owed on regulated Internet gambling activities are collected, as they currently are from the land-based casino industry." [emphasis added]

If that means what it implies, it would remove the spectre of industry-wide federal gambling taxation from the discussion and leave taxation to the states. If not, then the nose of the federal casino-tax camel is still sticking through the legislative tent. And you know where that leads.

We've seen a nationwide gaming tax get shot down during the Clinton administration but there are desperate times, obviously. Republicans like Mike Huckabee and Rep. Steve King (R-IA) have been looking to sock it to casinos at the federal level for some years now, so I fear it could have bipartisan support, should such a debate come to pass.

It's playoff time. A tired, flat-footed Minnesota Twins squad looked positively dreaful last night, flailing at outside pitches from C.C. Sabathia (if you couldn't reach that slider in the first inning, your arms aren't going to be any longer in the seventh, son). Cliff Lee made short work of the Colorado Rockies (besides, Jim Tracy can't win in the postseason), the St. Louis Cardinals look set to continue their tradition of postseason underperformance and my Anaheim Angels are forever reduced to a quivering heap of Jello in playoff games against the Boston Red Sox. Why am I having visions of brooms?

Adelson's rescuer?

Wed, 30 Sep 2009 14:01:00 -0700

Meet Wilbur Ross. He's an investor of all trades with an appetite for distressed assets. And he's turning his sights to the casino industry. In particular, he's drawn a bead on "companies [who] are also looking at selling assets in the Chinese gambling enclave of Macau to support struggling operations in Las Vegas."

That means either Las Vegas Sands or MGM Mirage, and it's old news that Sheldon Adelson has been peddling a couple of retail malls and the non-casino aspects of Sands Macao (above). MGM is attempting a reboot (successful so far) of MGM Grand Macau but still might come up short on completion money for CityCenter, especially if condo prices have to be reduced. And it doesn't take a rocket scientist to figure out that one Macanese casino beats any number of hotel rooms or retail outlets.

Un-Trumped? Thwarted Trump Marina suitor Richard Fields is making another run at the property, which he's been trying to buy since Homer was a pup. Better still for him, he could get it for as little as $75 million. However, he's got dark-horse competition from a Maryland-based private equity fund that's making a play for all three of the Trump Entertainment Resorts casinos.

Notorious for mainly hanging its corporate shingle in tax-haven Green Valley, would-be casino operator Empire Resorts is not only re-headquartered in New York State, it's got new partners. Some of them bring checkered pasts to the table.

Also, Empire's hopes hinge upon the current administration reversing an especially paternalistic ruling from the George W. Bush years: namely, that casino sites must be within commuting distance of the tribal owners' -- in this case the St. Regis Mohawks -- reservations. If economic self-sufficiency is the endgame of federal/policy, Uncle Sam needs to loosen the apron strings.

Unready for some football. The unceremonious scrapping of Monday Night Football events at The Cannery is explained (second item). Magic word: clearance. Columnist John Katsilometes also notes that the second weekend of Zowie Bowie's Vintage Vegas was better than the first. Which would mean it's graduated from "bad" to "mediocre."

New England moralists are apparently OK with slot machines in Rhode Island, so long as they're covered by the fig leaf of mandatory greyhound racing. At least the slot players have a chance of actually catching the rabbit, metaphorically speaking. Animal cruelty is bad enough but when it's enshrined in state law it's even more objectionable, if such a thing is possible.

Buy our casino, please!

Tue, 29 Sep 2009 14:11:00 -0700

Any well-furnished casino that doesn't try to monetize its fine appointments is missing a revenue opportunity. However, it's one thing to covet the lovely furnishings of, say, the Sky Lofts at MGM Grand. It's quite another to check into a hotel room in a struggling Nevada market (hint: think blood-red aluminum siding) and see the following:

"Take A Little Something Home With You"

... followed by a list of prices for virtually everything that isn't nailed down. At the high end, you could pay $175 for a bed spread or $100 for a phone, while hand towels ($10), washcloths and pillow cases ($5) occupied the bargain end of the spectrum.

In between, you could drop $45 for a Lilliputian coffee maker or $25 for the TV remote. Since the TV was not for sale and remotes tend to be brand- and model-specific, you wonder who'd be fool enough to spring for that last item.

Not only is Casino X clearly desperate for anything on which it can turn a buck, it also has rather inflated ideas of the value of its appurtances. I can see paying $175 for an Encore bedspread, but Steve Wynn doesn't operate out in the sticks, if you get my drift. Oh, and Casino X might want to think about staffing up its players' club and check-in windows, if the length of the lines at both is a telling metric.

Harrahs' new BMOC. The incoming president of Harrah's Entertainment's Flamingo-centered bloc of casinos departs Indiana to rave reviews. Philanthropic, community-oriented and socially aware, Rick Mazer sounds like just what the doctor ordered for Vegas -- to say nothing of being someone upon whom we should keep close tabs.

Justice delayed. Employees of Station Casinos who may (or may not) have been short-changed in their paychecks, will just have to bloody well wait for their day in court, if Clark County District Court grants Station's request for "breathing room." Station is pleading hardship due to its current bankruptcy. Since the company has no one but itself to blame for being in Chapter 11, it's difficult to muster sympathy. But perhaps the judge will be of a more forgiving nature.

Don Marrandino's first coup. The newly installed boss of Harrah's Atlantic City casino quartet inks a new labor pact with Unite-Here. That was a piece of cake. Now, about those dealer-contract talks with the UAW ...

Meanwhile, back in Gary Loveman's 'hood ... You know those on-again, off-again Massachusetts casinos? Well, they're "off." Again. Not that there's any reason to rush, especially as the repeated delays lend additional borrowed time to struggling Foxwoods Resort Casino and Mohegan Sun.

From the mailbag #6

Tue, 29 Sep 2009 12:41:00 -0700

Reader kerr_mudgeon writes, a propos the return of "What Happens Here, Stays Here":

But it's still way better than the one they ran on TV in Los Angeles years ago featuring a bunch of well-dressed women walking into a casino, called "the wrecking crew"... as if their feminine power would beat the odds.

Oh my god, I'd forgotten that one! That takes me back a ways -- 10, maybe 12 years.

Larry, I got your message about being involuntarily unsubscribed. Would the other person who contacted me about this problem please drop me a reminder? My brain is like a spaghetti colander even on the best of days.

Unlucky dog. The depression has forced the (ostensibly temporary) closure of yet another tribal casino -- the inaptly named Lucky Dog, in Washington State. Memo to Strip casino owners: When players can't afford to patronize tribal gambling halls, how can they be expected to find the money for a trip to Vegas?

William Safire's greatest speech? It may have been one that President Nixon never had to deliver, thank God. Thanks to reader J.C. Carcamo for the tip.

Hell no, they won't; Penghu punk'd; Barbarians at the gates (again)

Mon, 28 Sep 2009 19:12:00 -0700

Pay taxes, that is. Two Indiana racinos are pushing back against a tax rate that averages 38%. Considering that the two tracks -- one run by Cordish Gaming -- are the newbies on the Hoosier State scene, one could fairly ask them, "Didn't you know what you were getting into?" As the article notes, neither Harrah's Entertainment and Boyd Gaming -- both which recently heavily reinvested in Indiana -- aren't whining about their tax rates.

But the racinos have a point. In states where the number of casinos is artificially capped by the Legislature, solons become the custodians of the industry's economic future, like it or not. And it only stands to reason that if the market is going be diluted, tax relief is in order. Considering that same-store revenues in Indiana have been nothing but down since the racinos opened, some push-back on the tax front was probably inevitable.

Hell no, they won't either. Allow casinos in Penghu, that is. Voters on the Taiwanese island voted against gambling expansion there, putting the issue off-limits for three years. The notion of planting mega-million-dollar casinos in remote, hard-to-reach parts of Taiwan never made that much sense to S&G, but big industry players like Sheldon Adelson and Gary Loveman have kicked Taiwanese tires in the recent past.

Did Adelson and Steve Wynn mistime their leap into the Hong Kong stock market? One Wall Street Journal columnist thinks so. Bad timing isn't the exclusive province of the public sector, though: A Washington State tribe borrowed $375 million on the strength [sic] of revenue forecasts that proved grossly over-optimistic. Percentage-wise, neither Harrah's nor Station Casinos missed the mark this badly.

Bob Stupak, R.I.P. The penultimate Vegas maverick is gone, having spent much of the last decade as a recluse. One especially thorough obit contains a quote by former Klondike owner John Woodrum that ought to be engraved on Stupak's gravestone (or at the base of that now-vanished Stupak statue): "If ever there was a guy beyond the rim of reality, there was Bob. But somehow he made reality happen."

Just what we don't need. They're baaaaack. Never mind the smoking wreckage they've made of Harrah's and Station, private-equity firms are rooting amidst the flotsam, looking to extend their morbid clamp on the casino industry. Leading the pack is Leon Black's inaptly named Apollo Management. Both indirectly (Planet Hollywood by way of Harrah's) and directly (Cosmopolitan, Fontainebleau), Black is reported to be scarfing up what few independent properties remain, raising the prospect of a Total Rewards oligopoly stretching from just above CityCenter to the southern frontier of the The Mirage.

There are also a few bottom-feeders in play. Hooters hardly seems worth buying unless Onex Corp. wants to do a tear-down and extend the Tropicana Las Vegas eastward. Current ownership of the Riviera is tapped out but the place still has prospects as a fixer-upper (not something that fits with Apollo's sack-and-pillage business model). If non-bottom-feeder Green Valley Ranch is really on the bubble of insolvency, then Penn National Gaming ought to quit chasing F'bleau, and try to drive a wedge betwixt Station and its Greenspun family partners. Penn would stand to inherit a beautiful property with far fewer problems than Big Bleau.

From the mailbag #5

Wed, 23 Sep 2009 12:26:00 -0700

Our Comment-Eating Server has been at it again, so here are a few reader remarks that got devoured in cyberspace (where no one can hear you scream at your computer) ...

With regard to "Gambling Scandal Ensnares Eight More":

This is disgraceful! How dare the Federal government interfere with private enterprise like this? Undoubtedly the casinos' self-government practices would have detected these infractions, right?

If -- and I'm not sure about this -- you're referring to tribal casinos, all generalizations are false, including this one. The Tran Organization took down 26 scores that ran the breadth and depth of casino industry: Strip resorts, locals casinos, backwater Isle of Capri operations, U.S. ones and Canadian ones, the smallest tribal casinos and the biggest, too. Even Barona Casino & Resort, which prides itself on being ahead of the industry, technologically speaking, got taken. The moral I draw from this is that too much stock is being put in game-protection technology and not enough in the human component. All the king's PTZ cameras and all the king's digital scratch pads don't know what a "false shuffle" is.

Another reader caught a hasty slip-up I made, when I wrote that Harrah's Entertainment's "$10 million a year for energy conservation isn't even 'a blimp on the radar' when it comes to Harrah's gargantuan annual budget. Heck, it's less than 2/3 of CEO Gary Loveman's compensation package for 2008 alone."

Maybe his compensation has gone down since 2002? I don't think so:

"Loveman, himself, is doing a bit better too: His business school professor's salary, approximately $120,000 (before consulting fees), is now well over $3 million, including stock options. He shuttles between his Boston-area home and Harrah's casinos around the country in a corporate jet. He has long since traded in his professorial Honda Accord for a Ferrari F-355 Spider. After 12 years in the same house, the Lovemans are currently building what neighbors describe as 'a very large' house in the Boston suburb where they live."

Maybe he's riding in a "green" corporate jet now?

Good point. What I was trying to compare was Harrah's $60 million in energy savings over six years. That is less than 2/3 of Loveman's $92 compensation for 2008. (His base salary for '09 is $1.9 million.)

And with regard to labor strife at Trump Plaza:

"While the casino's latest appeal is tied up in federal court, Trump Plaza management has refused to bargain at all.

"Trump Entertainment Resorts Inc., which owns Trump Plaza, has said it expects to win in court. The case was first filed in September 2008.

"The court could side with the casino or uphold the National Labor Relations Board's ruling requiring the casino to bargain.

"'Throughout this entire process, it has not been our intention to attack any dealers who have chosen to support the union,' Juliano continued."

... David, you said "Kudos to Trump Entertainment Resorts CEO Mark Juliano for going out of his way to soothe potential animosity between labor and management."

- I would say: Kudos to Juliano if Trump would bargain in good faith with the union that won the election. As it is, Trump Entertainment Resorts owns & controls Trump Plaza and refuses to dignify their employees with negotiations that they voted for.

That's a major reason that we need passage of a "card check" law, which includes heavy fines against employers like this who refuse to negotiate (for years) with their workers' duly elected representatives.

Fair enough. And finally:

I don't gamble on the Internet because of security concerns with unregulated offshore sites, but I agree with this comment [same blog entry, under ["Health care reform + Internet gambling?"]: This is great! Ron Wyden is an innovative and responsible law maker. As an Internet gambler, I'd be happy to support American-based companies, and pay my patriotic taxes, instead of sending my "business" to Costa Rica.

Thanks to everyone for corresponding.

Atlantic City sucks ...

Tue, 22 Sep 2009 18:05:00 -0700

... says the Motley Fool, in essence. Even Borgata, which posted a higher operating profit year/year, is deemed merely to suck less than everybody else. I'm not sure I'm with the Fools on this one. For instance, shouldn't Sands Bethlehem be doing better than fifth among Pennsylvania casinos, especially when you consider its proximity to New York City?

Elsewhere on the Boardwalk, the UAW is fighting Trump Plaza, the Plaza is fighting the National Labor Relations Board and Trump dealers are fighting amongst themselves. Since 32% of dealers initially voted against UAW representation, it should be a cinch to round up 30% to sign a decertification petition. Kudos to Trump Entertainment Resorts CEO Mark Juliano for going out of his way to soothe potential animosity between labor and management.

MILF convention in A.C.: On Oct. 3, former Bunnies and other veterans of the short-lived Playboy Hotel & Casino will return to the shore to relive the good old days. A few might even wriggle into their old Bunny costumes. Maybe a re-infusion of the Playboy brand is what Atlantic City needs. It can only help. Are you listening, Carl Icahn? Revel? Pinnacle Entertainment? Anybody?

Finally, a reason to visit Orlando ...

... or maybe not. And that dude from Scotland is in serious need of subtitles.

Resort-style casinos come to Colorado and doesn't Ameristar's new hotel look lovely? Now, if only somebody would build a mid-market property like this on the Strip. Why must average Americans settle for older, second-tier properties if they're to afford a Vegas vacation?

Health care reform + Internet gambling? Is it just me or is Sen. Ron Wyden (D-OR) onto something here? This may be just the carrot to dangle in front of legislators who still balk at allowing Americans to wager on the Web.

Creditors screwed again. How much is Greektown Casino worth? Is it the $725 million its creditors claim? Or the $540 million that Greektown asserts? Or maybe the lowball $485 million that lead bidder Tom Celani is willing to pay? Greektown's recent -- and well-publicized -- inroads into the market share of its Detroit rivals lend merit to the higher-end valuations. If the place was in the doghouse, I might sympathize with Celani (who's likely to boot the very management team responsible for Greektown's turnaround), but Fine Point Group has definitely enhanced a once-seedy casino's value.

It's official. VIP-player commissions in Macao will be capped. Since the war over junketeer commissions was threatening to make Macao a negative-revenue proposition, the new ceiling will greatly improve cash flow for Macanese operators. Middle-of-the-pack Galaxy Entertainment is expected to benefit the most (+27% EBITDA), followed at some distance by Stanley Ho (16%), with Las Vegas Sands and MGM Mirage bringing up the rear. Although the elderly Ho may be on his deathbed, he's lived long enough to broker peace in a potentially destructive situation where the only sure winners were the sought-after junket operators.

Gambling scandal ensares eight more

Mon, 21 Sep 2009 18:32:00 -0700

It's not quite on the global scale of the Ultimate Bet brouhaha, but the Tran Organization's conspiracy to fleece dozens of U.S., Canadian and tribal casinos is racking up an amazing head count. To date, federal prosecutors have already nailed 31 scalps to their wall, not counting three other individuals to who pled out to related charges (including one in Canada).

If you thought this was the end of the Tran Organization ... surprise! The feds unsealed another set of indictments this month. Eight more individuals were hit with various counts of "conspiracy to steal money and other property from Indian tribal casinos, and conspiracy to travel in interstate and foreign commerce in aid of racketeering."

At the core of the Tran Organization's scam was the execution of "false shuffles," whereby "slugs" of unshuffled cards were insinuated into blackjack and mini-baccarat decks. This required the cooperation of corrupt casino employees and, from the looks of the Department of Justice's announcement, the core Tran Organization members must be rolling on their casino-employed helpers.

The Tran gang managed to take no fewer than 26 casinos during the life of its scheme, which is a very black mark against the industry's standard of game protection. The dishonor roll is as follows:

1) Beau Rivage Casino, Biloxi, Miss.
2) Casino Rama, Orillia, Ontario, Canada
3) Foxwoods Resort Casino, Ledyard, Conn.
4) Gold Strike Casino, Tunica, Miss.
5) Horseshoe Casino, Bossier City, La.
6) Horseshoe Casino & Hotel, Tunica, Miss.
7) Isle of Capri Casino, Westlake, La.
8) Majestic Star Casino, Gary, Ind.
9) Mohegan Sun Resort Casino, Uncasville, Conn.
10) Palace Station Casino, Las Vegas, Nev.
11) Resorts East Chicago Hotel & Casino, East Chicago, Ind.
12) Sycuan Casino, El Cajon, Calif.
13) Cache Creek Indian Bingo & Casino, Brooks, Calif.
14) Emerald Queen Casino, Tacoma, Wash.
15) Imperial Palace Casino, Biloxi, Miss.
16) Argosy Casino, Baton Rouge, La.
17) Trump 29 Casino, Coachella, Calif.
18) Isle of Capri Casino, Bossier City, La.
19) Agua Caliente Casino, Rancho Mirage, Calif.
20) Spa Resort Casino, Palm Springs, Calif.
21) Pechanga Resort & Casino, Temecula, Calif.
22) L'Auberge du Lac Casino, Lake Charles, La.
23) Nooksack River Casino, Deming, Wash.
24) Barona Valley Ranch Casino & Resort, Lakeside, Calif.
25) Caesars Indiana Hotel & Casino, Elizabeth, Ind.
26) Monte Carlo Resort & Casino, Las Vegas, Nev.

A one-ton horse

Wed, 09 Sep 2009 17:56:00 -0700

If giant equestrian statuary isn't enough to make you pass up Las Vegas for a vacation in Chandler, Ariz., I don't know what will do the trick.

Not impressed. One reader wasn't bowled over by Commerce Casino's largesse to a group of Bay Area firefighters who are battling nearby blazes. Informed that the firemen were being fed on Commerce's dime, aforesaid reader laconically replied, "Hopefully they're feeding them better than they feed their customers." Ouch!

No more "free" play?; Sahara sleaze; Donny & Tina; Criss F. Angel

Mon, 31 Aug 2009 17:29:00 -0700

In a decision that could have wide-ranging implications, Foxwoods Casino Resort and Mohegan Sun have been ordered to count (and pay taxes on) "free play" coupons as though they were revenue. This isn't a sock-it-to-the-players move like the one the Hawaii Legislature just pulled, taxing any money won at a casino (even if it's lost right back and then some). However, the ramifications for consumers if free-play coupons are targeted for taxation are discouraging. Play 'em while you've got 'em.

That stale "sleeping giant" analogy has been dusted off (and I use that verb advisedly) for some pimpery of the Sahara. On the glass half-full side, classy and romantic dinner spot House of Lords has been revived. It used to be a perfect place to take your Special Someone and hopefully will remain so. It's just off the main casino floor -- the most Moorish-themed part of the Sahara and the best "retro" experience to be had in town. (Almost everything else of newer vintage is bland grind-joint crud that needs to go.)

As for the empty half of the glass, that'd be the news that owner Sam Nazarian continues to go downmarket with a vengeance. Because nothing says "classic Vegas" like a tattoo parlor and a biker convention. Worse still, the tramp-stamp place will be in the otherwise elegant main lobby, with extended weekend tattoo-ing times ... since you never know when you want to do something you'll regret the rest of your life.

This "desert jewel rich with history and nostalgia" will continue that tradition with "a wet wife-beater contest, bikini tricycle races, a bourbon paired beef dinner with leatherwear fashion show, and an all-you-can-eat beer fest BBQ with one lucky rider winning a 2009 Harley Davidson Cross Bones bike." It's probably just a matter of time before Nazarian converts the big rear parking lot to a trailer park, too. That's Sam Nazarian for you: "class" with a capital "K."

"Tina Sparkle," flanked by Donny Osmond (evidently still in his pajamas) and Marie, who's looking damn fine from here.

It's old news that Donny Osmond is going to be on the next season of Dancing with the Stars, but I hadn't known he was going to be paired with Aussie Kym Johnson. The latter is known to my Better Half and I as "Tina Sparkle" (it's a Strictly Ballroom thing), which would make for great DWTS levity next season, except ...

... for the soul-crushing news that the gorgeous and talented Cheryl Burke has been twinned with the repulsive (and potentially prison-bound) Tom DeLay, one of "Casino Jack" Abramoff's band of Beltway scoundrels. (Was scum-tastic sleazemeister Rod Blagojevich not available?) Bad luck for Cheryl, good news for DeLay because Ms. Burke could be matched with a tree stump and get aforesaid stump into the final three. If she could carry a woodpile like Cristian de la Fuente to the finale, DeLay should be easy lifting. It looks like he's got the requisite arboreal quality.

Does Criss Angel have compromising photos of high-ranking MGM Mirage executives? The company's "branding" him now, evidently having convinced itself that Believe is beyond wonderful ... and never mind that 11-year-old O regularly outdistances Believe in ticket sales by several country miles. Having sunk $85 million into this Cirque du Soleil turkey, MGM is evidently going to stick with it until the last dancing rabbit is hung.

Pinnacle meets karma

Thu, 27 Aug 2009 13:30:00 -0700

Plans by Pinnacle Entertainment to move its President riverboat upriver just hit a big snag. Taking the view that the President's license is portable, Pinnacle hoped to use either the vessel itself or the license to jimmy open a new market niche along the Mississippi River.

Seems the Missouri Gaming Commission doesn't hold with Pinnacle's logic. Move the ship, they say, and it's open season on that 13th (and last) license in the Show-Me State. Right now, Pinnacle's keeping the President operational as a charity case -- thereby preserving the license -- but the Coast Guard is likely to shut her down in 10 months, so decrepit is the vessel.

Not that I wish ill for Pinnacle, one of the classier outfits in the industry, but this here is what's called "karma." Both Pinnacle and Ameristar Casinos pushed hard for legislation last year that uncapped the state's loss limits in return for capping the number of licensees. It was an anti-competitive move that was inveighed against in these pages.

Ameristar and Pinnacle tried to lock up what was an open territory. Now, with the President's license skittering about the field like a wet football, Pinnacle's going to find itself having to grapple with the very competitors it thought it had excluded from the game. Which is as it should be.

There can be only one. Two casino proposals from Cordish Gaming and Penn National have been forwarded to the Kansas Lottery Gaming Facility Review Board (Uff da!) for final arbitration, Remember that the last time we went through this, Penn got a whopping zero votes (probably due to a series of peevish public pronouncements), but then Cordish wanted to resubmit its project in smaller form.

This time around, Penn execs have been playing well with others, rather than trying to dictate the process. They're promising a three-phase, $564 million casino-resort (subject to certain economic conditions). Cordish is choosing to under-promise, committing only to a $390 million casino, at least until bluer skies return. Partnership with the Kansas Speedway still gives Cordish an edge (as does the Hard Rock brand) ... but the Kansas-casino process has been long, tortuous and filled with reversals of fortune. (Mike Ensign, anyone?)

Speaking of Kansas ... shoo-in Foxwoods has announced that it's restructuring its debt and enlisting outside assistance, yet another victim of ill-timed expansion. Small wonder Foxwoods and Lakes Entertainment decided to pool their pennies on Chisholm Creek Casino (above) rather than duke it out for the Wichita market.

Compromise is near. Down in Florida, that is. A formula too complicated to summarize here would bring the Seminole Tribe and the Sunshine State's Lege into agreement. (The Seminoles took one look at the compact fashioned by the Lege last spring and spat it out like bad food.) In return for accepting some restrictions on game offerings at some casinos, the Seminoles get a complete exemption from paying taxes to the state -- if private-sector gambling spreads beyond Broward and Miami-Dade counties. And if existing non-tribal casinos get, say, blackjack the Seminoles' obligation to the state is halved.

So tell me, why does Sheldon Adelson seriously think Florida is a potential growth market?

Mixed prospects for Foxwoods

Tue, 25 Aug 2009 14:20:00 -0700

First, the good news. Lyle Berman has folded his hand in Kansas. His Lakes Entertainment is scrapping its own casino bid and taking a partnership role in Foxwoods' Wichita-area bid. Apparently Lakes is no closer to finding financing than when it started ... but neither is Foxwoods. Both companies will be digging into their own pockets to pay for the $225 million casino.

With 1,300-1,500 slots and 30 tables, the Foxwoods/Lakes joint venture will be smaller than any of the previous casino proposals for the area. A J.P. Morgan report also implies that hotel facilities and other amenities will be sloughed off onto a third party to be named later. So Foxwoods emerges the de facto winner and Mike Ensign is left to wonder how different things might have been had hadn't bailed out his errant son ... and to come up with incredibly lame excuses for his withdrawal.

Remember Philadelphia? No, there is still no casino in the City of Brotherly Love, even as some outstate facilities are into their second iteration. Having failed to open -- or even build -- its casino within the time period alloted by statute, Foxwoods is going to petition the Pennsylvania Gaming Control Board for an extra two years.

It'd be a surprise if Foxwoods' request isn't granted. True, all Foxwoods has to show for itself is a much-criticized South Philadelphia site plan (which has been aptly likened to a big-box retail outlet) and a couple of possible fallback positions downtown. The way things look now, Foxwoods may be prodded back toward South Philly, though it's no likelier to find a friendly reception there than it's done anywhere else.

The alternative, however, looks far worse. Pennsylvania would have to restart the application process, select a winner and then pray it could open its slot house within the statutory 12 months. Which also means that Philadelphia has to go through site-review Hell all over again ... and casino opponents aren't going to be caught napping this time around. Could a new entrant accomplish more than Foxwoods by September 2011? It's highly improbable, given the rocky history of bringing casinos to Philly.

Can't imagine why

Thu, 20 Aug 2009 13:30:00 -0700

From the dispatch box of J.P. Morgan:

"Yesterday, the Wichita Eagle reported that South Central Gaming Partners (or Prairie Sky, which consists of former executives of Mandalay Resort Group [read: Mike Ensign, whose son's sex-payola scandal gives new meaning to the phrase "pay for play"]) would no longer partner with Chisholm Creek Casino Resorts (Foxwoods Development Company) for a casino in Sumner County (South Central Gaming Zone). The article noted that Foxwoods Development Company President Gary Armentrout indicated that he did not know why Prairie Sky withdrew and also stated that Foxwoods would go forward without Prairie Sky."

Two words, Gary: "background investigation."

Privé: behind the juice; Chucky vs. Jaws; Wynn pages Scalia

Wed, 19 Aug 2009 12:46:00 -0700

Had the Nevada Gaming Control Board not come down upon Planet Hollywood like a hod of bricks, it's entirely probable that Privé would still be up to its scofflaw antics. That's because Clark County has a long history of looking the other way or, at most, administering the occasional love-tap on the wrist. But when Gaming Control lays down a half-million-buck fine, it's kind of hard for Clark County Manager Virginia Valentine's crew to keep their heads in the sand, pretending to be invisible.

Hence the revocation of Privé's license, quickly restored once the Titanic deck chairs were rearranged and the vessel rechristened the Lusitania. I feel much better now, don't you? (It should be noted that there's a sizeable constituency in Las Vegas that thinks the county and NGCB should turn a blind eye and laissesz les bon temps roulez. Hey, why don't we bring back bribery, too? If those officials are going to be ignoring the laws they're charged with enforcing, shouldn't they be compensated for it?)

Kudos to the ever-clever management of Cannery Casino Resorts. They've struck a deal with ESPN to allow simulcast of Monday Night Football on Galaxy Theaters' giant DMAX screen at the original Cannery. The festivities begin on Sept. 14 with a Bills/Patriots and Chargers/Raiders doubleheader. (OK, the nightcap sounds like a real dog, but MNF doesn't get the pick of the litter since moving to cable.)

A 60-foot-tall Terrell Owens? Scary! More worrisome still: Will egomaniac Jon Gruden hog the mike this season, elbowing aside co-analyst Ron Jaworski? Nobody breaks down a play like "Jaws" but will "Chucky" let him get a word in edgewise?

Steve Wynn must be getting a little apprehensive about how Labor Commissioner Michael Tanchek's long-running hearings on tip confiscation will play out. Wynn's benched the able Gregory Kamer, as well as Wynn Resorts' in-house counsel, in favor of Beltway attorney Eugene Scalia. And, yes, his dad is that Scalia. (Does anybody else think the Bush administration passed over Scalia Sr. for Chief Justice in favor of John Roberts because he -- unlike Roberts -- was too contentious to forge majority rulings? Just me? OK.)

Wait Until Dark (@ CSN) obtains tepid praise from the R-J. I saw it last Friday. What's my verdict? Tune in tomorrow!

There's only one Native American currently serving on the federal bench. Might Nevada make it two? Vito de la Cruz, S&G hopes you receive due consideration.

Economic parable: Once upon a time there were two thrift stores in my neighborhood. One, run by Catholic Charities, sold good merchandise. The other, Goodwill, peddled garbage. Guess which one went out of business? It's like the nonprofit version of the Walmart saga.

Mike Ensign's downfall

Tue, 18 Aug 2009 17:42:00 -0700

It's all over for Mike Ensign. The former COO of Circus Circus Enterprises has seen his Prairie Sky casino consortium drop-kicked from consideration for a Kansas casino. That's right; a Lakes Entertainment bid that is hedging its bets by vacillating between two sites and entered the running without having financing in hand is moving on to the semi-final round. (So is Foxwoods Development.) And Ensign? He gets a seat in the bleachers.

True, Kansas Lottery Executive Director Ed Van Petten said Ensign Sr.'s payment of 96 dimes' worth of hush money to his son's mistress "not an issue to us at all." He added, inaccurately, "There hasn't been any allegation of wrongdoing at all." So Van Petten either doesn't read the papers or ... say, did I ever tell you about this great bridge in Brooklyn I'm selling? No money down, adjustable-rate mortgage, the whole nine yards.

Even if Van Petten's on the level, the Kansas Racing & Gaming Commission had promised "a full background investigation" of the winner. (Translation: "We're going to be crawling up your sphincter.") So even if the Prairie Sky project had surmounted the next two hurdles, Mike Ensign would have eventually had to explain his generous subsidy of Sen. John Ensign's bedroom adventures.

It's going to be tough for Dad to spin this one. Either he lost out on merit to a comparative small-timer like Lyle Berman or his enabling of Johnny Casino's hide-the-salami antics got him kicked to the curb. Which is the less humiliating narrative?

When the chattering classes began predicting l'affaire Hampton would be the end of an Ensign's career, I'll wager they had a different Ensign in mind. Oh, and thanks for dragging the industry into the mud with you, sir. Let's hope there are no more $96,000 shoes still to fall.

Adelson bombing in Pennsylvania; RoboPoker returns; Dissent over Wynn

Thu, 06 Aug 2009 17:26:00 -0700

Both the opening of Sands Bethlehem, and recent expansions of Meadows Racetrack & Casino (+29%) and Mohegan Sun at Pocono Downs (+21%) drove an 18.5% increase in slot revenue this July. With $19.6 million in gross revenue, Sands was only good for fifth place, barely behind Mohegan Sun ($19.8 million).

Adelson's new slot parlor was well off the pace set by Philadelphia Park Casino & Racetrack ($30.8 million) and The Meadows ($29.9 million). Harrah's Chester didn't perform too shabbily, either, pulling in $27.3 million from the one-armed bandits. Both it and Philadelphia Park were less than 2% down from their July '08 revenues, putting paid to the theory that Sands Bethlehem would draw -- at least in any significant degree -- from the Philadelphia area. Only nearby Mt. Airy Resort & Casino is taking a serious hit.

Downtown Reno's nicest casino, the spacious Silver Legacy, is taking a big step downmarket by succumbing to the cheesy allure of RoboPoker. Even that bit of good news for PokerTek wasn't enough to keep Aristocrat Leisure from writing down its share of the company.

Steve Wynn is The Man, at least in Macao, according to the controversial Jim Cramer. I agree.

Why then, is Wynn Resorts COO Marc Schorr cashing out at a time when the stock is arguably undervalued? Maybe he's just one more American who got overextended in the go-go Bush Era.

Off to Michigan

Wed, 08 Jul 2009 00:04:00 -0700

If you notice an attenuation in the S&G blogorrhea, it's because I'm taking a view days to visit terra incognita: the Upper Peninsula of Michigan. I'll be spending an extended weekend in the bucolic environs of the greater Marquette area. And, if I start to climb the walls, I might even poke my snout into the nearest tribal casino.

I'll be in a neck of the woods that doesn't have cable TV, which will provide needed respite from the two most tiresome "news" obsessions of the moment: anything and everything related to Michael Jackson, and the hidden meaning in the convoluted locutions of Sarah Palin. Whatever her virtues, the Great Communicator she ain't. (For unimprovable concision, my favorite American president is Calvin Coolidge, he who said, "The business of America is business." A political philosophy in six words. Hard to beat.)

City slicker that I am, I'm sure I'll stick out like a sore thumb in towns like Ishpeming. Sort of like a dog nursing a cocktail ...

So whose leg do I have to hump to get a dry martini up there?

Case Bets: California, Packer pickle, Macao pix, Holy Cow!, Singapore, RoboPoker, etc.

Thu, 25 Jun 2009 16:24:00 -0700

Editor's note: An item involving Crown Ltd. contained factual errors, which have been corrected (as you'll see). I apologize for the misinformation. My thanks to the reader who pulled my head out of my @$$.

California gamblers stay and play ... at home. While the recession has made some inroads on tribal-casino revenue in the Golden State, it's losing less ground than Las Vegas. Some of those Vegas losses will eventually be recouped, but this day of reckoning was bound to come.

Unlike Las Vegas, which is arguably suffering from having too many competing profit centers within each resort, California casino bosses interviewed still view entertainment as either a loss leader or a one-off. I never thought I'd say this but Las Vegas could use a little more "old school" thinking right now.

James Packer, the guy who can't catch a break, is finds his casino company in even more hot water, in a case of the sins of the father being visited upon the son. The plot surrounding Crown Ltd.'s courtship of a self-banned high roller (and convicted felon) is thickening considerably. Seems paterfamilias Kerry Packer may have been pressuring crony John Williams to get pathological gambler Harry Kakavas back to the tables.

Williams, for his part, rolled on the late Mr. Packer, ~~who's now got some 'splainin' to do~~. ~~No wonder the young Packer's pursuit of Cannery Casino Resorts collapsed like a pup tent.~~ The money quote, if you will, is: "[Williams] said it was common for patrons to rip up [self-exclusion] cards and that, in his view, Mr Kakavas's loss of $2.3 million in 28 minutes was recreational gambling."

If you lose $82,000 per minute, it's not recreation. It's degenerate gambling.

Globe-trotting Ian Sutton is back from Macao and G2E Asia. The sights! The sounds! The smog!

(Update: Ian says it's not smog but mist, as forthcoming videos will show.)

Holy Cow II: GlobeSt.com, normally a continent source of business news, is shocked -- shocked! -- that Steve Johnson's proposed casino on the former Holy Cow site will include a Walgreens. Smelling salts, stat!

But there are some interesting revelations, For one, the reason that Palazzo's flagship retailer is also a Walgreens is that it was a compromise Sheldon Adelson effected with the landowner ... Steve Johnson. (The mere fact of Adelson compromising is newsworthy enough.)

Turns out, that purchase may set the record for an on-Strip acquisition, at an alleged $50 million per acre -- Phil Ruffin, eat your heart out! Johnson also paid through the nose for the Holy Cow site. The price? $23.5 million/acre for land north of Sahara Avenue. Egad!

Columbia Sussex's casino portfolio continues to crumble. Tropicana Entertainment parent Tropicana Casinos & Resorts is selling its Amelia Belle riverboat (thereby forfeiting the New Orleans market) barely two years after the ship was acquired. Amelia Belle is former Harrah's Entertainment vessel, having been Bally's Belle of Orleans.

It's a canny strategic move for new owner Peninsula Gaming, which now has a Louisiana riverboat as well as a racino and four OTBs, not to mention a small flotilla of Midwest riverboats. TropEnt CEO Scott Butera, meanwhile, has less and less over which to preside. At the moment, his ambit consists of four riverboats, mostly in tertiary markets, two casinos in Laughlin and one on Lake Tahoe. Is this TropEnt's future: A succession of piecemeal asset sales? Sure looks that way.

Bad news for Sheldon Adelson. Over in Singapore, rival Genting's mega-budget Resorts World at Sentosa is letting news outlets like Bloomberg know that 60% of the project will ready for a soft opening in early 2010 (i.e., February-March). Projected attendance figures have been revised 20% downward.

In a rapier thrust at Marina Bay Sands, a Genting exec said the company was having regular meetings to make sure it came in on its $4.5 billion budget. Full completion of Sentosa is projected for 2012. Sands is going to have a sufficiently tough time making its nut without Genting crashing the party so soon ... to say nothing of the fact that Genting enjoys much higher brand equity in that corner of the world.

RoboPoker has risen from the grave. Electronic table games have been OK'd for eight New York State racinos. Though the Lege hasn't signed off, the Empire State's lottery board is confident it has the authority to make this move unilaterally. Poor Atlantic City is dying the death of a thousand cuts.

Congratulations to Penn National. It's scheduled to inaugurate a new pavilion for Empress Joliet today. A March 20 fire resulted in a three-month closure of the boat and substantial fiscal hardship for Penn National. In a noble gesture, CEO Peter Carlino kept employees on the payroll even though his ship was hors de combat. Capt. Carlino, S&G salutes you.

Seven essential Web sites ... and other news

Thu, 25 Jun 2009 12:23:00 -0700

Yes, you too can can be a gaming-industry blogger, with the help of but a few absolutely indispensable Web sites. The ones that I check Monday-Friday without fail (and, as they say on Dancing with the Stars, "in no particular order") are:

GamingFloor.com: The best aggregator of casino news from around the globe, especially since Editor Ian Sutton has an eye for the bizarre. Tons of eye-catching video, too, plus Ian's own on-the-spot reporting from far-flung venues like G2E Asia.

DieIsCast.com: Very eclectic but Dr. David G. Schwartz pounces on fascinating (and not very obvious) stories, often making droll pop-culture connections ... which frequently involve Star Trek.

TwoWayHardThree: Terrific discussions of casino architecture, intermingled with scoops that eagle-eyed moderator Hunter Hillegas snaps up -- not infrequently beating the local papers to the punch. His readers/forum contributors are some of the best-informed you'll encounter.

Las Vegas Sun: You're not going to find better gaming coverage this side of the Wall Street Journal and labor reporter Michael Mishak is one of the finest in the business. (The R-J's pathologically anti-union stance is probably to blame for its feeble coverage of workplace issues, as that paper's editorial-page psychoses leach into its news priorities.) Unlike its cross-town rival, the Sun doesn't take its marching orders from the Chamber of Commerce, either.

Press of Atlantic City: In the land of the blind, the one-eyed paper is king. Oh, and Press: Your new "reader-friendly" redesign blows donkeys. But if there's news a-brewin' on the Boardwalk, this is the first place to look. For more selective -- but in-depth-- coverage, Suzette Parmley in the Philadelphia Inquirer is tops in the region.

Vegas Happens Here: No morning is complete without a jolt of news from the indefatigable Steve Friess. His blog isn't casino-centric but he's quick to spot a breaking story or one that might fly under the radar ... and his Min-and-Bill relationship to Steve Wynn makes for tremendous ongoing fun. Lots of pictures, too.

Las Vegas Review-Journal: Only because it exists (which, existentially, is open to debate). Like the elephant in your parlor, it must be acknowledged and sometimes its slave-driven reporters turn in exceptional work, despite their editors' best [sic] efforts to beat them down. (Inexcusably, last week the entire gaming staff was detailed to chronicle seemingly every hand played at the World Series of Poker.) The paper's shining achievement was Joan Whitely's exposé of dangerous corner-cutting at Harrah's Entertainment. Relative newcomer Arnold Knightly has ferreted out some laudable scoops, too. Howard Stutz, look to thy laurels!

Honorable mentions go to three sites that I can't always check on a daily basis, but which should not pass without notice ...

Pechanga.net: An exhaustive (and sometimes exhausting) aggregration -- but it's a sieve which captures many tribal and regional gaming stories that would otherwise escape notice.

VegasTodayandTomorrow.com: Anybody -- and I mean anybody -- interested in the history and future of Sin City should have this site bookmarked. Mark Adams pores over the Web and any other source at his reach, presenting what bids fair to be the definitive online museum of Las Vegas' evolution. Our "Question of the Day" about the never-built Conrad was greatly aided by Adams' preexisting work. And the Coke-vs.-Pepsi map is must-see Internet.

The Movable Buffet: More showbiz- than bidness-focused. However, in a Vegas blogosphere infested with sycophants, Richard Abowitz provides a needed corrective to the local fawning over the celebutard of the moment. If you wish to following the continuing meltdown of Criss F. Angel step by step, Abowitz is your man. He even makes a colloquy with Holly Madison interesting. The chap's a miracle worker!

Farrah Fawcett, R.I.P.: One of the greatest of Seventies icons has died, at age 62. I was always more of a Cheryl Ladd fan myself, but Fawcett showed herself to be seriously "misunderestimated," especially in her Oscar-worthy turn as Robert Duvall's adulterous wife in The Apostle. Haven't seen it? Rent it! Ditto the severely underrated See You in the Morning, a still from which graces the Los Angeles Times obituary. Speaking of movies ...

Scott Walker 30 Century Man: A rock-and-roller who draws frequent comparisons to Samuel Beckett? Meet reclusive American expat Scott Walker and discover that the analogy has surprising validity. His handsome baritone is also one of the most compelling singing voices to emerge from the U.S. And speaking of singing ...

Patti LuPone's Orleans gig last weekend may just be the downpayment on a long-term deal. If so, it'd be one of the best shows in town and it fits the Orleans Showroom hand in glove. If only LuPone would drop from her set list that anthem to codependency, Oliver!'s "As Long As He Needs Me." She unloads so many mannerisms upon it that it's like Bill Sikes pummeling Nancy. Still and all, I'd take it over a second visit to American Superstars (also reviewed). Aaaaaaaaaaannndddd speaking of shows ...

I've received a critique of the Harmon Theater's new Monday-night, witching-hour potpourri, After the Show. While I'm not at liberty to quote any of it, suffice it to say that After the Show is described in such hallucinatory and pejorative terms that the bottom line is, even if you're a local resident and thus get in free, you've still paid too much. Better we should stay home and watch Jon Stewart, with a Conan O'Brien chaser.

Danny Gans: Still dead -- but not yet resting in peace. For the truly morbid, the R-J has published the 911 call made by his widow (as did the Sun). Listen if you care to; I didn't.

Diversity initiative at MGM Mirage

Tue, 19 May 2009 16:43:00 -0700

As in revenue diversity. Just when it looked as though CEO Jim Murren was getting locked into a Vegas-(almost)nothing-but-Vegas strategy, he busts out a couple of initiatives that would further expand and diversify his company's global reach and revenue stream.

After getting out two years back, MGM has quietly gotten back into the running for a 4,500-machine racino in Queens, N.Y. The company also has Florida-based developer R. Donahue Peebles in its corner. Others in the field for the Aqueduct contract include discrete bids by Steve Wynn and Penn National Gaming.

The latter is the only one currently involved in racinos and would seem like the logical choice, but observers seem to favor MGM's bid. If it goes through, the Aqueduct racino would pose a serious threat to other casinos in the region -- even MGM's own joint venture at Foxwoods Resort Casino. At least Foxwoods has table games, whereas slots-only Sands Bethlehem could see a huge chunk of its projected customer base gravitate back to the five boroughs.

In a low-risk deal, MGM is also franchising its MGM Grand, Skyloft and Bellagio brands to a trio of boutique hotels in Dubai. Developed by Dubai Pearl FZ, the threesome comprises a grand total of 630 rooms. Back here, that wouldn't add up to one wing of an MGM Mirage resort hotel. Otherwise, the Dubai Pearl project sounds awfully familiar: "an 'integrated city' with 5-star hotels, apartments, condominiums, retail and convention space." Kinda like ... oh, what's that big place down on the Strip? Yeah, CityCenter, that's it!

Exit the king? He's not quite off the stage, but in an event of historic proportions, Kirk Kerkorian's stake in MGM has fallen to 39%. Holy King Lear's abdication, Batman! Does this simply presage another Kerkorian comeback ... or the end of an era?

Upset in Kansas

Tue, 12 May 2009 17:00:00 -0700

I'm going to go broke trying to make book on who's going to get the three remaining casino licenses in Kansas. "Nobody" is a shoo-in for the Cherokee County vacany from which Penn National walked away last year.

But even the presence of former Mandalay Resort Group executives didn't help South Central Gaming Partners. Jilted by Harrah's Entertainment last year, this investment group just got passed over by the Sumner County Commission. Although Foxwoods Development's parent casino, back in Connecticut, has been struggling lately, it got a nod. So did Lakes Entertainment, which earlier had freely conceded it didn't have financing in place -- no small consideration when your proposal is the most expensive of the three.

Two S&G readers made headlines recently ... or rather, one of their St. Bernards did, thanks to his very vocal protestation of tornado-alarm testing. The sounding of the tornado claxon is one aspect of Midwestern life I find myself not missing in the slightest. So, Chaz, I feel your pain, son.

The good, the bad, the Jeb

Tue, 12 May 2009 13:23:00 -0700

Florida's popular, gaming-friendly Gov. Charlie Crist is going to make a run for the U.S. Senate seat that opens up in 2010. First, he has to get past former archnemesis Marco Rubio, who recently termed out as speaker of Florida's lower house, but early polling suggests Rubio won't be much of an obstacle, running a mere 46% behind Crist.

Rubio was the loudest and most nuisance-making of the various opponents of Crist's compact with the Seminole Tribe. His qualms were ultimately upheld by the Florida Supreme Court and there's never been any love lost between those two. If the GOP hopes to keep that Florida seat, Crist ought to be a lock.

Speaking of Florida, whose face keeps popping up in TV footage of GOP pizza parties but ex-Gov. Jeb Bush. Never mind "brand equity" problems that the Bush name might have these days. The Jebster's diehard opposition to gambling, his backhanded treatment of the Seminoles and his socially interventionist tendencies (think Terri Schiavo) make him the perfect presidential candidate for '12 ... as in 1912.

Update: Crist's declaration inspired this blogosphere zinger, "Florida's Crist to run for US Senate -- anti-Crist says bring it on." Throw in a speedy NRSC endorsement and it looks like Game Over for Rubio.

Boy, was I wrong!

Wed, 06 May 2009 12:29:00 -0700

Given their tightly held scruples about gambling, period, I figured that there was no way on God's green earth that Florida's Republican-dominated House would agree to lowering the gambling age (at least for slots) to 18. That looked, at first blush, like a deliberately inflammatory proposal, a star atop the state Senate's Christmas tree of gaming-industry concession and the first thing to go during negotiations.

Ha! I repeat: HA! House members are still dead-set against letting people in Tampa play blackjack, but lowering the gambling age to 18 has passed without a murmur, reports the Orlando Sentinel. Even the House has come round to granting the Seminole Tribe some tables (but only blackjack), while the Senate counterproposes a two-tier system whereby half the Seminole casinos get the full monty and half get none, just slots. As with poker limits, it's not a question of "Will they or won't they (get tables)?" Now it's, "How much?" Class II machines for parimutuels are off the table but state senators have come back with something even more contrived. It's enough to make your head spin.

No longer a Dream: June 1 has been set as the date for City of Dreams, the first megaresort built by Melco Crown Entertainment. Despite having two (eventually four) hotel towers, it will open with but 600 hotel rooms, potentially maxing out at 2,200 units. Hopefully, the initial business will give CEO Lawrence Ho something to crow about when he addresses G2E Asia later that month.

Quote of the Day

Tue, 28 Apr 2009 18:51:00 -0700

"We took their land and it is coming back to haunt us." -- State Sen. Steve Wise (R-Jacksonville), a casino opponent, observing that the Seminole Tribe's gambling-driven ascendancy in Florida is a form of karmic payback.

Saint Jack

Fri, 24 Apr 2009 16:59:00 -0700

Who says nobody finds redemption in the slammer? Washington, D.C. über-sleazeball Jack Abramoff, presently spending some quality time as a guest of the federal penal system, is seeking redemption via a pair of Hollywood liberals. (Irony abounds.) Kevin Spacey and Factory Girl director George Hickenlooper are developing Casino Jack, a biopic that aims to present a kinder, gentler Abramoff.

Considering that Abramoff bilked and deceived Native American clients, fraudently gained control of the Sun Cruz casino line (part of a beyond-seamy saga that included eventual bloodshed) and was an out-and-out racist, Spacey and Hickenlooper are going to have employ a bathysphere to dredge up empathy for this sack of sludge and like-minded sidekick Michael Scanlon (to be played by Young Darth Vader himself, Hayden Christensen).

But, an Abramoff sympathizer insists, it was "Casino Jack" who was the victim and what he did "wasn't ... anything that wasn't happening on K-Street already." Even if you swallow that bullshit sandwich, the supposition that Abramoff's actions were just bidness as usual doesn't even begin to excuse them.

Let's hope this project gets put in perpetual turnaround. Besides, Abramoff doesn't deserve to be portrayed by an actor as good as Spacey. I'm thinking they should cast the part with Ted McGinley instead.

Updates: Pinnacle, Boyd, Foxwoods, Donald Trump & Criss Angel

Wed, 22 Apr 2009 16:07:00 -0700

Don't wait by the phone if you've got a date with Pinnacle Entertainment. It has just pushed back the timelines on its Baton Rouge and Lake Charles projects by five months. It cited investor reluctance and warned more delays are likely.

Analysts like few gaming stocks and one of those lucky few is Penn National. But a Morgan Joseph analyst thinks Penn has gone about as high as it should and perhaps too high. The sparked an early sell-off of PENN, thankfully followed by a rally.

One more thing to blame on casinos. The tighty righties (and lefties) are going to have a field day with this. It's a windfall of free publicity for Foxwods Resort Casino, though.

The mouth that snored: How far over the shark has casino mogul-turned-TV performer Donald Trump jumped? Would you believe he was "spotted dozing off during Paul McCartney's concert Sunday at The Joint at the Hard Rock Hotel," according to gossip columnist Norm(!) Clarke. By all accounts, the McCartney show was far and away one of the most electrifying concerts given in Vegas in quite some time, launching Joint 2.0 in style. Sleepy Uncle Trump, though, officially qualifies for fuddy-duddy status.

Mike Weatherford, author of Cult Vegas, has a refreshingly contrarian take on the Criss Angel brouhaha from last weekend. Both MGM Mirage and Cirque du Soleil knew what they were getting (or at least thought they did) when they signed Angel. The real disgrace here, IMO, is that it took Cirque nearly 72 hours to crawl forward with an apology. D'ya mean to say they actually had to think it over? Ridiculous ... though not as ridiculous as the amount of oxygen being consumed by the Carrie Prejean kerfuffle. Would the vaudeville hook please drag that Stepford Wife-to-be and her have-they-nothing-better-to-do detractors off the stage, please?

(Prominently visible in at least one clip from the show was Treasure Island owner Phil Ruffin, separated from Old Man Trump by a stunning beauty whom I took to be Mrs. Ruffin. Whoever she was, the leading pageant contestants weren't a patch on her.)

Case Bets: Seminoles, Iverson, Harrah's, PartyGaming, Station's luck, etc.

Wed, 15 Apr 2009 16:01:00 -0700

Down in Florida, the tide may be turning in favor of the Seminole Tribe. Both the Florida Retail Federation and Restaurant Lodging Association have thrown their support behind the status quo, as represented by Gov. Charlie Crist's Class III casino compact. Crist's unilateral gambling expansion has the not-so-small problem of being unconstitutional but this latest turn of events ratchets up the pressure on solons to pass a version of the compact that meets judicial muster.

That'll be no problem with the state Senate but the uptight House would like to roll back the Seminoles to slots-only status (and would get rid of the casinos altogether, if only they could in their benighted heart of hearts). The table-game genie isn't going back into the bottle -- at least not until the federal courts have their say -- so the Solomonic question at hand is how to level the playing field for private-sector racinos without sacrificing the Seminole tax revenue that Crist secured. Easier said than done, obviously.

"Is too!" "Is not!" Both MGM Grand Detroit and Greektown are refuting a report in the Detroit News (with which MGM has taken issue before) that they'd 86'd former Philadelphia 76er Allen Iverson from their casinos. Let's face it, the man is a boor but he's a wealthy boor, so neither casino is likely to turn him away as long as he only bounces basketballs, not checks.

Headless casino. Not only did Harrah's Entertainment sack the GM and five other execs at Harrah's Reno, it won't be replacing them. At almost any other company, running a casino by remote control would come as a surprise but Harrah's has the reputation of employing a ruthlessly standardized business model. Besides, the company has to free up some dough to pay its new Internet/World Series of Poker guru Mitch Garber, whose former employer, PartyGaming.com, just cut a deal with the feds.

The luck of the Fertittas. Dodging yet another bullet, Station Casinos extended negotiations with its debtors by another month. While some form of bankruptcy at Station is inevitable, the company continues to fend off a takeover attempt by Boyd Gaming. However, Station says that when it comes to the terms offered to unsecured creditors, it's hanging tough. If that's the case, what's to discuss? (Or is Station being more flexible than it's letting on publicly?) My money, so to speak, is still on Station brass and co-owners Colony Capital retaining possession of Station and at a substantial discount to its market value, too.

An obscure racino company is cleaning house and relocating from Las Vegas (where it had no logical business being headquartered) and back East, where all its business is. The board of Empire Resorts really wasn't minding the store, was it?

The company might at least saved a bundle on long-distance charges if it had condescended to have its corporate offices in New York State, where its physical operations were, and not in tax haven Green Valley. But don't cry for outsted CEO David Hanlon, who parachutes out with 100 grand and plus another hundred large for nine months of "consulting services." These days, nothing succeeds like failure -- provided it's done on a grand scale.

Update: These are the same clowns whose Maryland slot application got tossed because they didn't bother to include the mandatory application fee when they filed.

Pennsylvania's biggest gaming screwup is history ... sort of. Former Mount Airy casino owner Louis DeNaples is guilty as hell of hanging out with the wrong crowd but innocent of perjury and will maintain one degree of separation from the casino, which remains in the DeNaples family. The Pennsylvania Gaming Control Board can claim a semblance of victory but the four-and-a-half-year imbroglio is a lingering embarrassment to a body whose vetting process has been inarguably the sloppiest in the U.S.

The PGCB needs to pay more attention to background checks and less to "juice" (see Barden, Don) -- and also to develop questionnaires that aren't so "imprecise and potentially confusing" they could open applicants to charges of perjury. It would also behoove Pennsylvania to quit "stovepiping" PGCB and state police investigations. Were it not for a lack of information-sharing (prohibiting by Keystone Kop, er, State law), this whole mess would probably have been avoided.

Kansas heats up again

Thu, 02 Apr 2009 13:57:00 -0700

It's always either feast or famine for the casino industry's prospects in the Sunflower State. A week ago, there was one in-progress project, Butler National's low-cost Dodge City casino and almost nothing else. Now, with the window of opportunity slamming shut (again) for Wyandotte County, a slew of applicants has skittered over the sill.

First in was Cordish Co., making good on its promise to be back with a downsized proposal for the Kansas Speedway. A $390 million Hard Rock-branded casino will be the entirety of Phase One, with the hotel and all other amenities to emerge at an unspecified future point. Yesterday, Penn National Gaming got back into the act, pitching a $500 million iteration of its Hollywood Casino brand. It'd be a full-service product (hence the higher price tag) but Penn's noblesse oblige attitude and its abrogation of a casino development it had been awarded in Cherokee County may still rankle the Kansas Lottery Commission. It blanked Penn in the previous round of bidding.

Hard on Penn's heels comes Las Vegas-based Golden Gaming, which lost to Cordish by one vote last time around. Its proposal is Cordish-like in terms of proposing a $360 million casino (with restaurants and entertainment venues) to be eventually followed by another $300 million in augmentations. These would include an expansion of the casino from 2,000 slots to 2,500 and from 65 table games to 98. Also promised are "a 300-room hotel, spa, restaurants, retail shops, convention and meeting space, an 18-hole championship Tom Watson golf course, 60-lane bowling alley, entertainment venues and more."

(Boy, $660 million sure goes a lot farther in Kansas than it does in Vegas. Here, all it gets you is Aliante Station.)

Golden's would-be project, to be sited along I-70 near Edwardsville, is Cordish-like but arguably Cordish Lite, too. Allying itself with the speedway and sublicensing the Hard Rock brand gives Cordish two sharp arrows in its quiver. It'll take some pretty strong argumentation by Golden to persuade Lottery commissioners to reverse their earlier preference for the Baltimore-based developer, which can now also point to the early success of its Indiana Live! racino as further evidence of its suitability. In Round One, last year, the vote between Cordish, Golden and Penn went 4-3-0 in Cordish's favor. It's the latter's game to lose.

Over in Sumner County, previous applicant Equity Ventures has been pawing the ground for a while now. It's hedging its bet by optioning two sites but one of them is entangled in litigation due to the City of Mulvane's attempt to grab, er, annex it. (Way to improve that tax base, guys!) Jilted partner of Harrah's Entertainment, which retreated from Kansas last year, Equity's profile got higher this week when former Mandalay Resort Group CEO Mike Ensign turned up at the helm.

After a bit of hemming and hawing, Foxwoods Development is returning to the fray, too. It's making the argument that it can get a casino on line quickly and inexpensively, probably in the $225 million neighborhood. Squeaking in just under the wire is Lakes Entertainment, coming off a rebuff by Ohio voters last November. Like the Ensign group, Lakes is opting for a parlay of sites, one of them in Wellington.

The state ought to have fun sorting out what are, in effect, five proposals. Equity has the theoretical advantage of representing the core of the joint venture that won the bidding last year (presuming that Harrah's defection hasn't left a sour aftertaste). Foxwoods, despite recent economic misfortunes in Connecticut, still owns the longest and strongest track record. Promising an operational casino lickety-split is music to tax-starved bureaucrats' ears, too. Lakes has the site (Wellington) that's been bruited as the ~~Lottery's~~ Sumner County Commission's location of preference. This one's impossible to call.

That leaves orphaned Cherokee County, where bidding remains open for another three weeks. Anybody ... anybody at all? Don't everyone jump up at once, now ...

Case Bets: Wynn, Adelson, casino closings & Number One

Mon, 30 Mar 2009 18:45:00 -0700

Last winter, I got a break on my rent -- but not nearly as good as the one Steve Wynn did. That's a nice deal, if you can get it.

Las Vegas Death Watch: In the latest "Stripper Poll" posted by Steve Friess, he asks which Strip casino should close first "if economic conditions warrant it." Through some glitch, the Tropicana was listed twice, so voters may be using two of their three votes on it. Either way, it's out in front with 40 votes, with hanging-by-a-thread Hooters second (31 votes) and Circus Circus, the casino people to hate -- and patronize -- third with 29, as of this writing.

The fourth-place showing by the customarily derided Imperial Palace counts, in this context, as good news for the IP. As for the Tropicana's prospects, I'd still count them better than Riviera's ... assuming Trop management gets its act together, which it shows few signs of doing.

Good news for Adelson: An analysis of the East Coast casino market finds Sands Bethlehem relatively sheltered from strong competition and likely to swipe business from two rival Pennsylvania slot parlors.

Whatever service workers get paid, it's not enough, as this story demonstrates. The indignity alone is impossible to quantify.

Case Bets: Florida standoff; No Goa; "Good news"?

Wed, 25 Mar 2009 16:39:00 -0700

Legislators in Florida are occupying different sides of the planet when it comes to crafting a new casino compact with the Seminole Tribe. At the risk of being accused of giving the store away, the state Senate favors granting full Class III gambling to the Seminoles, in return for $400 million a year. The lower house, meanwhile, would roll the tribe back to slots-only parity with southern Florida parimutuels and charge tribes $100 million ... for games they're to which already entitled under federal law. In the unlikely event the Seminoles assent to Plan B, it will probably get a constitutional body-slam in court.

The upper house's proposal is also more "george" for private-sector casinos, as the Miami-Dade and Broward county parimutuels would get limited table games and all parimutuels statewide would be allowed Class II gambling. The stingier House bill is the Line of Death for anti-gambling forces, who'd prefer to cut off a $100 million-plus nose to spite their collective face. Even if it prevails, it's too late to do more than protract the agony of existing non-tribal casinos in Florida. This war is over and the Seminoles have won.

Oh, and revocation of the existing compact would deprive the state not just of money of hard-to-get (if limited) judicial purview over disputes that occur on tribal land. These sorts of exemptions to tribal sovereignty are rare as hen's teeth, so solons might want to ponder whether it's something they're willing to forfeit for the sake of striking a pious stance.

Slumdog customer relations: What do you do when one of your players wins big at the tables? Beat the living crap out of him, of course. Let's see if this innovative form of customer-relationship marketing catches on ... not!

Unclear on the concept: "Good news No. 3: As of January 2009, Las Vegas’ hotel room inventory was 140,729, and this number is expected to increase by 9.9% to 155,562 by the end of 2009. In comparison, Orlando, Florida has 111,700 hotel rooms and San Francisco a little over 33,300."

Uh, this guy obviously wasn't CC'd on the memo that an onrush of new hotel rooms at a time when visitation is in decline is not "good news."

(Quoth Andrew Zarnett of Deutsche Bank, "We view a CityCenter postponement as a net positive for the overall Strip demand and supply dynamics, which is currently lopsided towards oversupply.")

Taking a page from Red China, lawmakers in New Jersey propose "stopping payments to state prisoners who make license plates and do other work." I hold no brief for convicted felons but, the last time I checked, slave labor was illegal in this great land of ours.

Big bounce in Pennsylvania

Thu, 05 Mar 2009 14:04:00 -0700

Casino revenues in the Keystone State leapt 14% from February of Leap Year to this year, at least at six of the state's seven casinos. (Hollywood Casino at Penn National Race Course is excluded; it wasn't open a year ago.) That's $126 million against $110 million, even with one less day in the month, which is divided 55/45 between the state and operators. A 1,578-machine increase in slots, mostly at Mohegan Sun at Pocono Downs really helped, too, as you'll see.

The comparisons of gross-revenue (not to be confused with cash flow, which can be considerably less) are as follows ...

Mohegan Sun @ Pocono Downs: $12.4 million/$17.8 million (44%)

Philadelphia Park: $28.5 million/$30.3 million (6%)

Harrah's Chester: $28.5 million/$27.9 million (-2%)

Presque Isle Downs: $12.1 million/$13.9 million (15%)

The Meadows [Cannery Casino Resorts]: $17 million/$20.6 million (20%)

Mount Airy Resort: $11.6 million/$15.3 million (32%)

Plus another $19.7 million realized at Penn National. Once expansions are completed at The Meadows and Philadelphia Park (more bad news for Harrah's Chester), and Sands Bethlehem and Rivers Casino in Pittsburgh open, the state expects the annual take to swell to $2.25 billion, with industry employment growing to 8,500 souls.

Three-fourths of the value of the troubled, $1.7 billion Cannery/Crown Ltd. deal now rests on The Meadows. Crown says it expects an annual cash flow contribution to be $115 million versus only $35 million from the two Canneries in Las Vegas. If New Yorkers really are willing to drive an hour and 50 minutes to pull the slot handles in Bethlehem, then Sheldon Adelson's 17% projected ROI won't be as zany as it appeared at first blush.

Elsewhere in the 'sell block'

Mon, 02 Mar 2009 15:44:00 -0700

Note: Parts of this were published earlier but got devoured by our resident Comment-Eating Server.

The Motley Fool paid another visit to the sickroom and found Las Vegas Sands even sicklier than it when it was first pronounced a "deathbed stock," $61.95/share ago. But despite being down 'merely' 58%, Isle of Capri Casinos was pronounced "gravely ill," following the announcement that it would be temporarily suspending racing at Pompano Park. (Yikes!)

Add that harness track to the list of Goldstein Era show horses that have turned out to be broken-down nags for current CEO James Perry. While the sport of kings is a terminal patient, nobody -- yours truly included -- foresaw that Florida racinos and slot-enhanced parimutuels would be a duff proposition. Even if the Seminole compact is revised to put parimutuels and tribal casinos back on a level playing field, the Seminoles' lead on the private-sector casinos is several furlongs and growing.

Not in Kansas anymore: The messed-up casino-development process in Kansas won't be Gov. Kathleen Sebelius' problem for much longer. But governor, how does it feel to have to take sloppy seconds from D.C. retread Tom Daschle?

Nevada's overreliance on casino taxes has caused yet another leak to spring in the state's budget, a thing of shreds and patches even in the best of times.

Poker: The Musical. At last, the problem of the Tropicana Las Vegas showroom is solved! (Although it would be pretty damn funny in an unintentional way if you booked a tuner called Poker playing a casino that closed its poker room.) The official site can't be bothered to host sound clips, so head on over to Napster for a sample or 10.

Boyd vs. Station II

Thu, 26 Feb 2009 11:58:00 -0700

Well, that was a waste of a good hour. Boyd Gaming teased its Thursday morning conference call with intimations that All (or at least Some) Would Be Revealed about its surprise bid for most of the assets of Station Casinos. Boyd execs made a few pro forma comments about the offer at the top of the show, for want of a better term. They then announced that they would be taking no questions about the Station bid, so don't you be asking any, sonny.

Later, they did relax to the extent of allowing that they assume that Station's management contract with the Thunder Valley tribal casino near Sacramento would be included (but implied that Station's management pact with a Michigan tribe would not). The reason that the general public is in some confusion about what Boyd would be paying $950 million for is: Boyd itself is uncertain. Company officials implied they weren't getting any cooperation from Station -- or to the mythical entity that Boyd's president consistently refers to as "Stations [sic] Casinos." (You know ... the archivals of Boyds Gamings and builders of Red's Rocks Resorts.) After he buys it, of course, he can call it whatever he wants.

One of the many questions begged by Boyd's non-presentation was what's going to happen to Echelon, now that the company proposes to cannibalize its remaining $2 billion in borrowing capacity (against $2.6 billion in debt) to finance the Station deal. That money had been earmarked for finishing Echelon. Seemingly intent on having his cake and eating it too, Boyd prexy Keith Smith said, "We have nothing to report on [Echelon]" but added that having a Strip presence remained a long-term goal. Translation: Don't hold your breath.

Smith also ducked some pointed Larry Klatzkin queries regarding performance expectations at Blue Chip, in Indiana. (He evaded a question about ADRs, too.) ~~CFO~~ COO Paul Chakmak, referring to the expanded riverboat complex as "the new Blue" (do I sense a marketing slogan there?), said that early results are promising if not definitive. He noted that a record 2008 and January '09 performance at Delta Downs in Louisiana "shows the value of our geographic diversity" and noted that Borgata was the only Atlantic City casino to post growing slot win in 2008. Boyd will be taking a variety of one-time charges, including on some of its North Las Vegas real estate, and will be drawing out the payment schedule on Dania Jai-alai, a would-be Florida casino venture that has gone into the freezer, due to a disappointing Sunshine State market.

"Our goal is not just to get by," Chakmak said, while allowing that the Las Vegas locals market "remains challenging." Downtown, he added, was a better scene, given that increased charter flights were offsetting any effect that might be felt from reduced commercial airline service to Hawaii. Why one would want to exponentially expand into a "challenging" Vegas market right now was yet another of those questions that didn't get to be asked.

Good news for bargain hunters in Atlantic City; Smith expects promotional allowances to "stay elevated" in 2009. He also said that, with only two weeks of service so far, it's much too early to prognosticate about the performance of the ACES train (a joint venture with Harrah's Entertainment). Boyd execs did talk up the savings achieved by infusing T.G.I. Fridays, Fuddruckers, Sbarro, etc. into their locals properties. If you were a Boyd restaurant employee whose eatery was displaced to make room for a fast-food franchise, you might not share that enthusiasm.

Case Bets: Penn in Vegas, Fontainebleau, Fine Cotton R.I.P.

Sat, 21 Feb 2009 15:05:00 -0700

Phil Hevener, the guy who was onto the Imperial Palace sale before anyone else, says Penn National pitched offers for not only The Mirage but also Caesars Palace ... at insultingly low EBITDA multiples (see bottom of story). The Strip has seen much better days but it's not a flea market.

Et tu, F'bleau? It hasn't even opened and already Fontainebleau's viability as a going concern is in doubt. Those thousand condos represent a giant millstone around the resort's neck; the relationship between Vegas casino operators and the condo business has been akin to that between lemmings and the sea. Already, it's looking like a rerun of the Harrah's/Station scenario: Partial recovery for senior debtors and a dime on the dollar for junior ones.

See no evil, speak no evil. A robbery was committed at a casino "in the 4000 block of West Flamingo Road," an address that just so happens to exactly coincide with the Gold Coast. (The Palms is in the 4300 block.) This is at least the third time that I can recall offhand in which the location of a casino robbery was obfuscated by local law enforcement -- nor the first time that Las Vegas Metro has placed a higher priority on protecting casinos' images than on solving crimes. It might be easier to find witnesses if you told the public where the crime took place, no?

I got a horse right here, his name is not Paul Revere and if you backed this horse you had quite a lot to fear. A quarter-century ago, literal also-ran Fine Cotton wound up at the center of a bizarre racing-fraud scandal involving a -- get this -- impostor horse. Could Dick Francis have dreamt up a better yarn than this?

Station to the rescue. With Thunder Valley execs given the chop and new managment parachuting in from Station Casinos, work has resumed at the Sacramento-area casino-resort -- after some downsizing of the original expansion plans. Kudos, Station.

Case Bets: Foxwoods, Greektown, Mesquite, iPhone follies

Sat, 21 Feb 2009 14:19:00 -0700

Foxwoods Casino Resort's Philadelphia beachhead is financially beleagured by problems on the home front. Says one economist of the Connecticut metaresort, "Their plan for growth was built on an economy that no longer exists and is not coming back."

A glimpse of Greektown:

Blackout? Casino oligopolist Randy Black is contemplating ditching his three Mesquite casinos (one of which is barely operational). Considering that the bottom has fallen out of the Mesquite market, it's difficult to imagine who'd buy.

Own-goal for Control Board: An overreaction by the Nevada Gaming Control Board to an iPhone card-counting program has sent the latter's sales to stratospheric levels. Silver State regulators have unwittingly made Travis Yates the entrepreneur of the year.

Trump: The end

Sat, 21 Feb 2009 13:40:00 -0700

So Trump Entertainment Resorts has such little worth that it's facing delisting, having become quite literally a penny stock. In a move described as "petulant," not only is Donald Trump taking his ball and going home, he wants the name of the company changed.

He claims he could have done better, had he simply been allowed to exercise his incomparable casino mojo ... but this emperor's been naked for the better part of a decade. As for the "wasteful spending" he decries, one can only guess he's referring to the capital improvements at Trump Taj Mahal (the sort of thing Trump himself could rarely be bothered with) which have goosed business there substantially.

The already discounted sale of Trump Marina to Richard Fields (who hasn't lined up the dough and recently liquidated his Manhattan pied-a-terre) looks shakier than ever -- and it was not a deal that inspired confidence to begin with. Trump's tantrum could easily kill it outright. Fields' company is hemming and hawing ominously. And if that sale doesn't come through, one analyst predicts a "death spiral" for TER.

View the video at CNN.com

Bloviation alert: Trump disses own casinos, says they're not worth beans.

Meanwhile, the Trumpster is engaging in a little revisionist history, complaining that the company hasn't diversified outside Atlantic City. Oh, its various incarnations have tried. A Trump-branded riverboat in Gary, Ind. (now Don Barden's Majestic Star II) enjoyed an early vogue, then went into steep decline. A Trump tribal-casino-management arrangement in California was short-lived. An effort to get in on the Philadelphia market went nowhere, except to court. As always with Trump, when in doubt ... sue!

Contrary to Trump's ever-bombastic contentions, things are not coming up roses for him elsewhere, either. (On a personal note, I balked at purchasing an otherwise appealing necktie at Filene's Basement because it bore the Trump moniker on the reverse. Would you call that "negative brand equity"?)

About the only good thing that's come out of Trump's insufferable TV series, The Apprentice, is that the mainstream media finally began paying attention to the thing of smoke and mirrors that was Trump's casino kingdom.

Looking for good news in Vegas

Thu, 12 Feb 2009 17:08:00 -0700

If I wanted to drive myself to strong drink, I could write about depressing, atrocious numbers coming out of Nevada casinos in December. But as that great philosopher, Linus in Peanuts, would remind me, it's better to light a single candle than to curse the darkness. (Next panel: Lucy hollering, "You stupid darkness!") Let's just say that December revenues hew to my saw that when Wendover sneezes, Nevada catches pneumonia and move on.

Two Sundays ago, the Review-Journal ran a pair of stories that warranted mention here at the time but got lost in the shuffle. Time to give credit where it's due, especially as these articles highlight some of silver linings inside the present-day storm front.

Boyd Gaming's is the least-sexy brand among the major casino operators ... but sexiness can be overrated. (See: Station Casinos) Unlike a certain crosstown rival which put all its eggs in the Vegas basket, Boyd has always rejoiced in a diversified portfolio. With Wall Street falling in love with the regional casino market, Boyd is likely to experience newfound appreciation on the Street.

Echelon: Stopped in the nick of time.

No wonder CFO Josh Hirsberg strikes such a sanguine tone. He also fesses up to a number of uncertainties, which is a refreshing change of pace. True, the company has halved its 401(k) matches but it hasn't deep-sixed them altogether, unlike several competitors. Also, it stopped Echelon while it still had the ability to alter the scale of the project, whereas Caesar Palace's Octavius Tower had crossed that Rubicon. It certainly doesn't rank anywhere near as high on the Mortification Meter as MGM Mirage's forced truncation of The Harmon (now to be an ungainly stump) or Las Vegas Sands' abrupt cessation of its St. Regis tower. Boyd's ongoing infatuation with fickle Morgans Hotel Group remains a major puzzlement but let's not belabor that now.

Boyd's chances of coming out the economic tsunami intact look good. Besides, the company has surprised people before. Who would have picked it to be the one that would shake up the Atlantic City market and force everyone else to keep pace?

A project that has the makings of a comparable success story in Las Vegas is M Resort, brainchild of the Marnell family. (You know, the folks who gave The Rio its cachet -- before Harrah's Entertainment took over and "geriatrified" the place.) Admittedly, $1 billion for a 390-room hotel/casino doesn't sound anything like optimal bang for the buck, but M Resort has three things going for it that Station's Red Rock Resort and Aliante Station don't: location, location, location.

Strategically, M's site is killer. It sits just north of the pass through which I-15 flows into the Vegas Valley, as you head in from California. In fact, you see the M tower even before you reach the pass, stunningly framed between the canyon walls. The vista from the north side of M ought to give it must-visit cachet when it opens in two weeks (March 1). The relative paucity of hotel rooms may bespeak caution over whether the stay-off-Strip/commute-to-Strip business model has worked yet. As they say on Wall Street, "visibility is limited" because like-minded Green Valley Ranch and South Point have gone private.

Also, by limiting their exposure on the hotel side -- where so much of the rest of the market is overexposed -- the Marnells should have supply/demand dynamics in their favor. A place like Morgans' Hard Rock Hotel, which only drew a third of its cash flow from gambling before Morgans went on a frenzied expansion binge, is super-exposed in the area that's most sensitive to price fluctuations -- hotel rooms -- and soon to become even more so. (The HRH puts a brave spin on it but it's no secret why the project is fully funded: It's 85% owned by the bank which, like the pig in the ham-and-egg-breakfast analogy, is committed while Morgans [i.e., the chicken] has but an interest.)

One also has to laud CEO Anthony Marnell III's incremental preparation for the Vegas market: a stint managing a tribal casino (giving him experience in the drive-in market), followed by acquisition of the Saddle West in Pahrump (ditto the locals market), then Laughlin. So his $1 billion dice-throw was approached via a circumspect route. George Maloof has already shown that a steady locals/hipsters mix can work as a business model. M Resort is the first project since The Palms to wholeheartedly go that route.

With nearby Olympia Gaming and Station (Inspirada) casino developments on indefinite hiatus, Marnell should be firmly entrenched before anyone else in the area gets a shovel in the ground. It's a serendipitous combination of preparation and circumstance. Of course, M could be either a succes d'estime or an outright bust, but the buzz I've been hearing is strong.

Tamares Group giveth (booking a new magic show into the Las Vegas Club) and Tamares taketh away, pulling back on a planned art museum (above). So if this is no time to invest $12 million in an art museum, maybe Tamares might want to invest it in its casinos. Comic relief is supplied by Mayor Oscar Goodman, who's been exceptionally obtuse this week. (See: President Obama, Silly Feud with)

Casinos in Texas are one of the longest of long shots but Galveston's name keeps coming up. The whole thing screams "Tilman Fertitta!", especially since we know he's wanted a casino there and was even rather colorfully accused of surreptitiously installing casino infrastructure in his Galveston convention center. He got a good chuckle out of that one, as I recall.

Wells Fargo: Block that myth!

Fri, 06 Feb 2009 14:58:00 -0700

A spirited debate on the Wells Fargo-at-Encore brouhaha is playing out at The Movable Buffet. The "pro" side is gaining the upper hand -- offering better-reasoned arguments will do that for you.

Let's accept for the moment that the junket was highly justifiable (as increasingly appears to be the case) and that Vegas is a highly affordable convention market (opinions differ). Was Wynn Las Vegas/Encore a bargain in and of itself? Compared to the rest of the Strip, no. Is it a bargain compared to the price niche Steve Wynn coveted? Yes ... dependng on when Well Fargo booked the trip. Is it preferable for Wells Fargo to hold this event in the good old U.S. of A., as opposed to such previous locales of Cancun or the Bahamas? Mais oui, bien sur, which I believe is French for "Like, duh!"

What's disturbing is the emerging tendency to link the cancellation of the Wells Fargo event with coinciding salary and benefit cuts at Wynn Resorts. First the Las Vegas Review Journal's more-clownish-than-usual editorial did it. So did the same paper's "Business Matters" blog, which one holds to a higher standard than the R-J editorial page. So too has Richard Abowitz. Neither he nor anyone else is making an explicit linkage between the two stories but we're seeing the coalesence of a new urban legend.

To wit: Steve Wynn got the cancellation notice from Wells Fargo, flew into a panic and imposed a wide-ranging series of stringency measures. Is that possible? Yes. Is it either plausible or likely? Not in the slightest, IMO. But it's certain to become the new received wisdom if this implied causal relationship keeps being floated in the media.

A penny for your thoughts, Steve? No fool he, Steve Wynn loves free media. But I'd pay (well, a buck or two anyway) to know how he feels about being at or near the center of this particular story. Since it's his property they're talking about and not, say, Sheldon Adelson's, he's probably remembering the old saw that there's no such thing as bad publicity.

You know you're in trouble when there's turmoil at your casino and you look for rescue from Station Casinos. That's like sacking the captain of the Titanic in favor of the skipper of the Exxon Valdez.

Case Bets: Seminoles, Tropicana, Shuffle Master, Stanley Ho

Tue, 03 Feb 2009 14:12:00 -0700

Seminoles offer to lay $288 million and 12,000 new jobs on the table, for starters. Sunshine State Republicans blow them a raspberry. Constitutional or not, Gov. Charlie Crist's compact put a good deal in place for both sides. (It wasn't so good if you were a non-tribal casinos, but they'd been underperforming even before Crist gave the Seminoles table games.) Unfortunately, Florida solons seem bent on pissing it away for a variety of reasons, spite -- mainly toward Crist -- not least among them.

Good news at Trop(s). It's a rare and welcome day for Tropicana Entertainment when it can announce not one but two pieces of good news in the same day. At the Tropicana Las Vegas, a marketing firm has been retained to try and reposition the LV Trop as a service-and-value-oriented property. TropEnt promises "to elevate its service and value standards,” in a slap at Columbia Sussex, its nominal parent company.

Out East, you can stick a fork in the Cordish Co. purchase of the Tropicana Atlantic City, now that the former has missed the deadline for reaching an agreement. What's the response from hapless Trop trustee Gary Stein? Why, to extend the sale another three months, of course. His Plan B would involve dropping any minimum-bid requirement from the bankruptcy auction.

Sending the Trop to Chapter 11 auction without a stalking-horse bidder hardly looks like a strategy that will drive the price up. ColSux was a lousy owner but neither it nor its creditors deserve to be ripped off like this.

As for Cordish, Stein is playing the role of battered spouse in a co-dependent/abusive relationship. Cordish, he coos, is still "actively engaged ... They have certainly not withdrawn." Why anybody would still listen to Stein, whose credibility is somewhere south of zero by now, is a mystery for the ages. Enough! It's well past time that the New Jersey Casino Control Commission sacked this sorry excuse for a trustee. These monkeyshines aren't remotely funny anymore and the vaudeville hook is way overdue.

Unless the NJCCC knows something the rest of us don't, there's no longer any viable excuse for not giving TropEnt at least a probationary interval as owner/operator. Its creditors have every incentive to make revenue grow there if they're to see their money again -- unlike ColSux which was acted as though it was perfectly happy to drive financial performance straight into the ground so long as the Trop was run on the cheap.

At least one Wall Street analyst likes Shuffle Master's choice of CEO better than I do. Timothy Parrott is a great guy for all I know, but there's little in his recent background to suggest that he's the turnaround specialist Shuffle Master needs.

Stanley Ho, sugar daddy. The godfather of Macanese gambling has shown a sudden upsurge of interest in the fortunes of Australia's Labor Party, funneling $587,000-plus into its coffers. As though to prove it isn't completely Dr. Ho's bitch, the ALP returned $326,000 from Angela Leong (aka Mrs. Stanley Ho). Because, you know, they've got standards. Yeah, that's it. (It's not unlike the Obama administration's exception-proves-the-rule attitude toward appointing lobbyists to critical guvmint jobs. Plus ça change and all that.)

Seems the ALP has been talking a good game about cleaning up campaign finance -- and the conservatives who've been resistant -- while raking in beaucoup HoBucks, even if they say they returned two-thirds of the money. Because $195K is totally cool but $587K would be de trop, I guess.

Or was the total extent of ALP-accepted Ho largesse even larger still ... like $912,000 maybe? The numbers are all over the one place but one thing is for sure: In the words of Opposition parliamentarian Michael Ronaldson, "The whole deal simply doesn't pass the sniff test."

Fertitta vs. Fertitta

Wed, 28 Jan 2009 14:06:00 -0700

After years of seeing players flee in droves to Lake Charles, Shreveport and Oklahoma, businessmen in Texas have finally had enough and are stumping for a vote to authorize casinos in the Lone Star State. It's a long shot but in these desperate times, I'd no longer bet heavily against it. Prudently, the proposal would redress a longstanding wrong (and sidestep a lawsuit or three) by restoring gambling rights to Texas' Native American tribes, some of the many victims of l'affaire Abramoff.

The Las Vegas Review-Journal's Howard Stutz adds that the Frank Fertitta Jr. clan (including presumably Frank III and brother Lorenzo) is in on the action. True, Station Casinos itself is tapped out but the Fertittas are sitting upon bushels of money made either through the UFC or the Station buyout.

If the Las Vegas Fertittas really do have their eyes on Texas, it'd not only present a business opportunity but a chance to stick it one more time to cousin -- and rival -- Tilman Fertitta. The latter, a scion of the Galveston Fertittas, has coveted a Texas casino for some time. One can only imagine how the irascible Tilman might take to seeing young Frank III and Lorenzo setting up shop in his backyard, especially after they covertly helped Tim Poster and Tom Breitling run up the price of the Golden Nugget purchase.

Regulation? Who needs it? If, as Nevada Gaming Control Board Chairman Dennis Neilander maintains, his agency is operating at 1991 staffing levels, then Gov. Jim Gibbons proposes to take the NGCB back into the 1980s. Perhaps Midnight Jim is feeling nostalgic for the heyday of Lefty Rosenthal. Who knows?

Whatever the case, Gibbons' proposed cuts would make it more difficult for the Control Board to account for the tax revenue that Midnight Jim claims he is at such great pains to conserve and maximize. Then again, trying to reconcile what Gibbons says with what he actually does has been an impossibility from the get-go.

One final indignity

Fri, 23 Jan 2009 16:31:00 -0700

An administration with a deplorable record on tribal issues found yet another way to stick it to Native Americans as it went out the door. As I said before the election, any change whatsoever in the occupancy of the Oval Office was going to be a "win" for tribes.

Casino "cruises to nowhere" that really don't go anywhere; that's OK. But expanded gambling on Florida's Seminole reservations? Horrors! Call the police! Both have every appearance of being unconstitutional, so why is the one raising nary a murmur while the other has legislators' knickers in a twist? Your guess is as good as mine. At least Sunshine State minds are not being clouded by the hobgoblin of consistency.

Case Bets: CityCenter, Detroit, Boyd in Indiana

Mon, 19 Jan 2009 15:03:00 -0700

CityCenter: Cash cow or calf of gold?

It's received wisdom that, in its worship of the Golden Calf known as CityCenter, half-owner MGM Mirage is prepared to sacrifice some of its high-value properties, including MGM Grand Detroit, even in the face of numbers like these. Perhaps a history lesson is in order.

After the 9/11 attacks and the crippling blow they dealt to the Vegas economy, one of the ways companies like MGM stayed afloat (and, in MGM's case, profitable) was that their Vegas operations were backstopped by regional footholds in markets like Detroit and Biloxi. Now one keeps hearing that MGM is bent upon putting all its eggs in the Vegas basket, with even MGM Grand Macau possibly to be had.

(A moment of levity: A Dutch casino executive, speaking at G2E, suggested in all seriousness that MGM buy Station Casinos or Boyd Gaming and transplant their [locals] customer base to CityCenter. Which shows almost as little understanding of the Vegas market as I have of Holland's casino business.)

If this is an accurate reflection of the corporate thinking at MGM, shareholders should be alarmed, at the very least. A CityCenter-centric strategy concentrates risk, rather than spreading it across multiple markets. The kind of pullback that's being mooted in the blogosphere and podcast cosmos would be so irresponsible that it would call the judgment of MGM leadership into question. However, so long as said management is answerable only to Kirk Kerkorian, that question may never be called.

Don't look for rescue from Foxwoods or Mohegan Sun. Their slot revenues have been sucking wind this year. Also, salary cutbacks to 9,800 Mohegan Sun workers bode very poorly for further expansion by the casino, which was bullish on the Kansas market not so long ago.

Boyd fights back. The opening of nearby Four Winds Casino really did a number (as in approx. -40%) on revenues at Boyd's Blue Chip riverboat in northeastern Indiana. Watching double-digit revenue declines, month after month, might spur those of us with lesser intenstinal fortitude to cut and run.

Not Boyd. It's reinventing its business model for Blue Chip, in best "adapt or die" fashion. The three-pronged response of a new hotel, spa and concert venue is an aggressive pushback. It probably won't restore Blue Chip to former levels of glory, at least where gambling revenue is concerned (Four Winds still has the "convenience factor" going for it with Michigan punters). However, it does fling a strong challenge at its adversary. Four Winds, the ball is now your court.

21

Wed, 31 Dec 2008 11:39:00 -0700

That's the number of predictions for 2009 issued by Spectrum Gaming Group, an Atlantic City-based outfit. They are, in no particular order:

• Advancements in technology that impact revenues and cut costs will continue to be attractive to operators even in an economic downturn.

Continued ...

• ... conversion of racetracks to racinos, as well as non-gaming expansions to existing racinos.

• ... elimination of jobs, both through cuts and attrition.

• ... moratorium on development of big-box gaming resorts due to economic downturn.

• Convenience-based gaming continues to achieve better year-over-year results than destination-based gaming.

• Corporate and property debt restructuring in wake of declining revenues.

• Eastern European countries will increase their efforts to meet EU regulations, including smoking bans.

• Gaming companies increase efforts to export their brands globally.

• Gaming equipment manufacturers continue to invest in games that appeal to a younger demographic, including lotteries, bingo and server-based technology.

• Increased legislative acceptance of allowing the deduction of issued electronic promotional gaming credits from the gross revenue tax/fee calculation.

• Increased use of electronic games, including the emergence of scalable electronic table games in which players at different locations on the floor wager on a single outcome.

• Increasing alliances between commercial gaming operators and outside investors, as well as between commercial and tribal operators.

• Internet gambling in U.S. will be a hot federal issue for the new administration and Congress; gaming companies will fund lobbying efforts on both sides.

• Major gaming operators commence deleveraging by selling off properties to emerging operators.

• More pronounced shift in market share among suppliers as operators attempt to shift away from IGT participation games.

• Native American tribal gaming revenue estimates remain on track to surpass U.S. commercial gaming totals.

• Prices for hotel rooms, shows and food and beverage will return to lower levels at large gaming resorts as operators need to fill their properties.

• Slow but continual advancement toward server-based gaming, as operators remain skeptical as to the potential financial returns on investment.

• States consider expanding or legalizing casino-style gaming to help fill state budget gaps.

• Support from China to ease visa restrictions, increasing flow of visitors into Macau.

• Uncertainty in various European countries concerning regulation, thus increasing cases being referred to the European Court of Justice.

We'll have to check back in a year, God willing, and see how clear Spectrum's crystal ball proved to be. There's nothing on that list that strikes me as off the beam and much of its seems dead on target. The only "WTF?" comes courtesy of a Spectrum exec who told a reporter, "In times like this, it's not like these are company-specific problems that can be attributed to some glaringly bad decision by the company."

I respectfully beg to differ. Choosing unreliable and/or overcommitted business partners (Boyd Gaming) was a decision. Opening in far-flung markets while your core properties were losing market share (Isle of Capri) was a decision. Taking on preposterous amounts of debt (Harrah's Entertainment) or simply assuming more debt than your cash flow and lavish spending tendencies can support (Station Casinos) were decisions. Trying to build metaresorts all at once (Boyd, MGM Mirage) was a decision. Rashly demolishing the Atlantic City Sands and thereby leaving yourself with empty, non-revenue-producing land (Pinnacle Entertainment), that's a decision.

Launching major projects that aren't fully capitalized (Las Vegas Sands, Cosmopolitan, Majestic Star) is a decision. Stubbdornly jeopardizing the license of the property that generates 40% of your cash flow (Columbia Sussex) is a decision. Making not one, but two major acquisitions at a time when your cash cow -- slot routes -- is giving less milk and then overpaying for some of the new assets (Herbst Gaming) is a decision.

Opening a $2.3 billion, years-in-the-making megaresort at the nadir-to-date of the economy (Wynn Las Vegas)? Now that, that was not a decision. That's playing the hand you were dealt.

Quote of the Day

Thu, 18 Dec 2008 14:59:00 -0700

"[T]he fact that he's from a somewhat Western state is good." -- a congressional spokesman, reacting to the nomination of Sen. Ken Salazar to head the Interior Department. Salazar is from the "somewhat" (but apparently not very) Western state of ... Colorado.

Fire sale at Harrah's, MGM?

Mon, 17 Nov 2008 13:10:00 -0700

That was one of the bombshells dropped this morning at Global Gaming Expo. According to a member of a "state of the industry" panel of G2E's Casino Design track, Harrah's Entertainment has several unprofitable properties that were for sale. "Now I believe any of [Harrah's casinos] are on the block," he said, adding that similar things could be said of MGM Mirage.

Architect Joel Bergman revealed that he'd laid off 29% of his staff last week: "Work has simply dried up." Perini Building's Dick Rizzo added that Kerzner International is still "bullish" on City Center II, at the north end of the Strip and its centerpiece will be an exact reproduction of the company's Atlantis Dubai resort (plus casino, presumably).

Dubai and Abu Dhabi were identified by Rizzo as two of the main growth pipelines that continue to flow. So does the California tribal-casino market, along emergent casino markets in New York State and Pennsylvania. He's also working with the Seminole Tribe in Florida, where two Hard Rock-branded casinos will double in size, starting next spring.?

As for job cutbacks in the tribal market, Rizzo doesn't think those are economy-driven but "an excuse to get leaner." He defended MGM Foxwoods as a victim of poor timing, saying it can't be judged on current performance. He pointed out that the soft debut of MGM Foxwoods prompted the mothballing of a similar expansion at nearby Mohegan Sun.

Rizzo shrugged off the implications of server-based gambling: "The public sees the casino the same way." And while he saw no prospect of non-gaming Strip resorts, off-Strip ones are conceivable. Given the current condo glut, Trump International and others are looking to convert those properties to pure hotel plays, at least until the market takes a more propitious turn.

Recently, MGM Mirage spokesman Alan Feldman took up President Jim Murren's contention that we may not see new construction on the Strip for a decade (does that make it a "meme"?). Panelist John Restrepo interprets that as a way of saying, "We don't know" where the world is going and "a bit of an overstatement," reflecting what Donald Rumsfeld infamously called "known unknowns."

Per S&G prediction, we're seeing a market correction in the prices paid for land on the Strip. Restrepo says the value per acre has readjusted -25% to -30% and even more so elsewhere in Las Vegas, including the corridor south of Mandalay Bay. Still, lenders are now requiring as much as 50% equity before they'll commit to a project, Restrepo notes

Restrepo also doubts the viability of the "If we build it they will come" paradigm that has so long served Las Vegas. Besides, it still remains to be seen whether Joe the Player is tapped out ... and Restrepo hears that a wave of car repossessions is imminent.

That being said, his company is performing feasibility studies for new projects, even if those developments are going to have be put on ice until a few years hence.

I hate G2E

Fri, 14 Nov 2008 11:35:00 -0700

Allow me to clarify.

The annual Global Gaming Expo is a great and good thing, bringing together industry members, vendors and academics from the four corners of the globe. You see the newest -- and oftimes the strangest -- products on offer. Many are all the more tantalizing for not having received regulatory approval -- placing them tantalizingly out of reach. I'll confess to a childlike fondness for the huge table game with the dome under which plastic horsies go 'round and 'round in a sort of mock Kentucky Derby. Silly, yes, and an absolutely pointless wager, but G2E doesn't stint on oddball entertainment value.

The sheer amount of brainpower that is directed into that outwardly frivolous activity known as "gambling" is an awesome sight to behold, especially when crammed into the Las Vegas Convention Center.

The conference tracks are an embarrassment of riches (especially when a speaker makes a particularly egregious faux pas). It's Sophie's Choice to the fourth power to have to select between panels sometimes. Heck, most times. And if there are any detractors of Native American casinos out there, if you subtracted the tribal attendance from G2E and many other industry conferences, they'd either be A) much smaller, B) ghost towns or C) defunct.

Then there's the yearly "State of the Industry" panel, which more recently has been "The Gary & Terry Show," with American Gaming Association President Frank J. Fahrenkopf serving questions to Harrah's Entertainment CEO Gary Loveman and MGM Mirage CEO J. Terrence Lanni. Except that Lanni canceled his 2008 appearance a short while back -- a harbinger of his resignation? IGT CEO T.J. Matthews will also be there, which should be, uh, interesting, especially with Loveman having launched a pogrom against "Wheel of Fortune" and other participation games.

However, there will be "added value" in the form of Ernest Stevens Jr., the Fahrenkopf of tribal gaming, taking his rightful place amidst the panel -- another sign that we've moved past the days when companies like Circus Circus Enterprises actively tried to suppress tribal gaming in neighboring states. (Speaking of Fahrenkopf, he had a cameo in this week's Frontline biography of GOP dirty trickster Lee Atwater, the man who brought you Willie Horton. It included a scene of Atwater spewing bile while Fahrenkopf stood at his left elbow. Whaddya wanna bet FJF wishes he could "disappear" that footage.)

Loveman gets all huffy if you challenge him about stuff (like why he lives in Massachusetts), so that can add to the fun. He's also very difficult to understand sometimes, because he's got the strange habit of swiveling his head constantly from left to right while answering questions, meaning that the microphone ... catches ... roughly ... every ... other ... word.

And yet ...

G2E is an ordeal. It's the Bataan Death March of the casino industry, as we haul ourselves from one end of the exhibit floor (which seems to extend beyond the curvature of the Earth) and back again, then repeat the exercise. Noise, crowds and the relentless pounding of one's feet on thinly-covered cement; it all takes a toll, especially for someone like myself who suffers from the triple whammy of fibromyalgia, osteoarthritis and recurring back trouble. The reams of paperwork one has to plough through beforehand can also drive you to despair.

In short, G2E is not for the faint of heart nor the frail of constitution. With that in mind, I offer 10 survival tips.

• The F&B Pavilion is your friend. Make liberal use of it, especially any free booze you can snag.

• The most important booth is not IGT's but rather the one where they sell the massaging insoles. I bought a pair last year and they were life savers.

• Chair massages. 'Nuff said.

• Sit down. As often as possible. You may not want to get up again, but duty calls.

• Cell phones. Set them on LOUD (as in jet-engine loud). In G2E, no one can hear your phone ring.

• Tchotchkes. The fewer you pick up, the better. The same goes for goodie bags. They'll just weigh you down and make your job harder. Travel light. Except for ...

• Business cards. Pack as many as you think you'll need. Then double it. At minimum.

• Downloadable slots. First, see if you can spot them (last year's bunch were indescribably bland). Then have a drink for every time somebody tells you they're "one year away" from deployment. Sort of like handheld gambling devices. (Remember them? They were The Next Big Thing ... three years ago.) For extra fun, use the term "vaporware" around the Cantor Gaming booth and see what kind of looks you draw.

• Don't play the slots unless you can get a sales rep to set them so they immediately trigger a bonus round. Otherwise you can waste a lot of time. Why they're not set to the bonus round as a matter of course remains a mystery.

• Fowl play. Remember the tic-tac-toe-playing chicken from Atlantic City? See if he has a booth this year. Then try to beat him. If you can, you're a true Master of the Universe 'cause that chicken's got game.

Get buzzed at the Trop. LVA just conducted a poll on casino smells, particularly the sort of piped-in aromas you'll encounter at The Palazzo. Which prompted a reader to ask, "So…… That moldy marijuana smell at the Tropicana is pumped in????? Interesting……"

Well, it'd be one way to get people to want to eat at that buffet.

Obama considers casino allies

Fri, 07 Nov 2008 16:28:00 -0700

It'll be a while before we find out which of the many potential appointees to President-elect Barack Obama's cabinet will actually make the cut. But there are lot of gaming-friendly faces on the list. (And note the number of governors from states with tribal casinos, though none of them are on the short list for the Interior Dept., most unfortunately.)

But if Massachusetts Gov. Deval Patrick gets the nod to head the Justice Dept., the Bay State will lose its number-one casino advocate. Fortunately, the casino-development process is sufficiently far along in Kansas that, should Gov. Kathleen Sebelius accept a portfolio, it'll be but a hiccup. And, judging from the number of people on that list who have dealt firsthand with private-sector and/or tribal casinos, both industries can look forward to finding receptive ears in Washington, come next January.

Quote of the Day

Thu, 06 Nov 2008 13:32:00 -0700

"It was/is the perfect marriage of greed and a desire to participate in shaping the future of the world's greatest democracy." -- Promoter Jeff Connor, describing Gold River Casino's election-themed slots to Raving Consulting. The promotion made (air)waves locally.

McCain wins!

Thu, 06 Nov 2008 12:44:00 -0700

Gold River Casino, in Oklahoma, found a way to get jiggy with the election. (Sen. John McCain "won" the mock plebiscite, with 52% of the handle pulls.)

This prompted the following missive from the event's promoter (which I've edited very slightly, so I doesn't read quite so much like a poem by ee cummings):

[J]ust stumbled across your blog and wanted to take a minute to thank you for calling our (pick a president) [YouTube] video "must see tv".

[W]e had a lot of fun creating the promo and the response was beyond belief; every slot, poker, BJ, and restaurant seat was filled on election night, which is not historically a great gaming night.

(Perhaps our Oklahoma City correspondent could be so kind as to share his thoughts on Gold River, assuming he's played there.)

MGM Mirage curbs retail. Word is just coming in of cutbacks in hours at MGM Mirage's Las Vegas stores. Watch our Today's News column for "the 411," as those 'Net-savvy kids call it.

Winners & Losers

Wed, 05 Nov 2008 13:52:00 -0700

And now the obligatory post-Election, What's-it-all-about-Alfie roundup ...

Culinary Union 1, Casino CEOs O: True, the Culinary tripped all over its own feet in the early going, leading to Democratic caucuses that weren't so much "Barackular" as "debacular." But D. Taylor & Co. backed the winning horse and did it early, which earns some chits down the road, plus they have a new Capitol Hill friend in Rep.-elect Dina Titus. Messrs. Lanni, Loveman, Wynn, Adelson and Trump made a variety of presidential wagers, losing every one.

Ameristar Casinos/Pinnacle Entertainment: They wanted a protected oligarchy in Missouri and now they've got it -- and at relatively little additional tax burden to them.

Slot manufacturers: OK, so Ohio and Maine didn't come through and the Missouri market is frozen. But 15K new slots in Maryland ain't chicken feed. Plus a West Virginia casino expansion that flew under the radar got voted in. Inexplicably, slot stocks traded downward. Stupid Wall Street.

Colorado casinos: They didn't so much "win" as get a hefty lifeline thrown to them by Rocky Mountain State voters who approved 20X higher betting limits, 'round the clock operations, and roulette and craps. (No Sen. John McCain sightings in Cripple Creek yet, though.)

Freedom's Watch: So far F-Double-U is 6-9-1 (with Sen. Gordon Smith [R] of Oregon momentarily in the "tie" column) in its top-priority races. I'm feeling generous and crediting the Adelson front group with "wins" in the case of self-destructing Rep. Tim Mahoney (D-FL), who continued the scummy tradition of predecessor Mark Foley, and in that of Sen. Saxby Chambliss (R-GA), who faces a December do-over, thanks to Georgia law. And veering off at the last minute to spend money attacking not-up-for-reelection Sen. Chuck Schumer (D-N.Y.)? Adelsonian political acumen at its finest. Winner? Loser? Let's call it a draw.

Poker: Just when it looked like the poker phenomenon was about to jump the shark, we've got a poker-playing president-elect. I dunno if Ms. Pelosi and Messrs. Reid, McConnell and Boehner cotton to hashing out legislation over cigars, booze and a deck of cards, but they'd better get ready for a whole new kind of "smoke-filled room."

Online Poker: Chances for a repeal of the UIGEA suddenly look a lot better.

Karma: Bearing false witness and serial adultery remain very uncool. But multiple felony counts and assorted other financial malfeasances remain A-OK with voters of both parties. (Hint: If Ted Stevens has to be forcibly removed from office, start practicing the phrase "Senator Palin." Kinda trips off the tongue, don't it?)

Gays & Lesbians: Voters in California stuck it to one of Vegas' most loyal constituencies big-time, passing the hateful Proposition 8. Were Nevada not so socially conservative (although compassionate enough to have legalized medical marijuana a ways back), I'd say we should vote for gay nuptials here, then sit back and gloat as the bucks roll in.

Tom Tancredo and ilk: Even if you abhor George W. Bush, you've got to give it up for his ability to rally Hispanic voters to the GOP standard. (I can't speak for Biloxi-Gulfport or Atlantic City, but Las Vegas can't function without its Latino labor base and casino CEOs know this; that's why immigration is their "third rail" of politics.) I always thought the immigration issue would be a non-starter in this election -- and it was. But the Tancredos of the GOP, by ginning it up in both '06 and early '08, antagonized Latinos, scored an own-goal and eradicated the gains Bush made with this voting bloc. So, in lieu of a prolonged post-mortem, maybe Republicans should just burn Tancredo in effigy and then turn the page.

Gaming's GOP influence: The annihilation of GOP moderates at the national level is largely complete, leaving an electoral map that looks a lot like the Confederacy, plus a horseshoe-shaped chunk of the West. Subtract Mississippi, Louisiana and tribal casinos and you've got slim pickings there. Gambling-friendly Republicans like Govs. Haley Barbour (MS) and Charlie Crist (FL) have made progress, but not easily and not without much expenditure of political capital. It's difficult to see where American Gaming Association boss Frank Fahrenkopf goes within his own party when he needs its support. The casino industry's investment in the GOP has yielded scant ROI.

Gov. Jim Gibbons: With state Sens. Joe Heck and Bob Beers, and Rep. Jon Porter all packed off to early retirement by their constituents, Gibbons suddenly has much less to fear from within his own party two years hence. (Ditto Porter's designs on Sen. Harry Reid's [D-NV] seat.)

Rep. Dean Heller (R-NV): If he opts to challenge Reid -- or Gibbons -- he's now the presumptive frontrunner. (I still think "Gov. Oscar Goodman" has a nice ring to it.)

North Las Vegas Mayor Michael Montandon (R): He's laying the groundwork for an intra-party challenge to Gibbons. Montandon's ably managed growth in NLV and would easily trump Gibbons on the "competence" front. The sudden political demise of Beers, Heck and Porter gives him a clear field of fire.

Tourists: Ever hospitable, Clark County voters gave them the finger, by endorsing a 2%-3% hike in the hotel tax. Thankfully, it's just an advisory vote.

Joe the Player: Winner. Clinton-era tax rates are coming back, which may hurt the "whales" but should be good for the rest of us. The Clinton administration coincided with halcyon years of casino growth, especially in Vegas and on the Gulf Coast. The succeeding eight years were dominated by M&A binges, condomania and a narrowing of the Strip's economic appeal toward the monied elite -- the latter being a very sore point among casino consumers. Vegas-wise, which eight years would you choose?

Jon Ozark: This cardboard dummy was wheeled into Nevada Assembly District 21 by local monied interests, to knock off Asm. Bob Beers -- not be confused with the less-hirsute state Sen. Bob Beers -- for having the audacity to stand up against Steve Wynn, he whose name dare not be pejoratively uttered in Carson City. That much having been accomplished, in the general election Ozark discovered once again that it takes more than a pretty face to win. Good luck in your next district, Mr. Ozark. They say the third one's the charm.

Ultimate Bet claims another victim

Tue, 04 Nov 2008 17:28:00 -0700

Add Excapsa Software Inc. to the list of companies and individuals who are being dragged down by the undertow of the Ultimate Bet scandal. Shareholders of Excapsa have been ordered to pony up $15 million, in order to make players cheated by Ultimate Bet whole. Ultimate Bet owner Blast Off charges Excapsa with selling it corrupted software that made the cheating ring possible.

One can draw a couple of conclusions from these events. One, that the Kahnawake Gaming Commission, under whose "oversight" the Absolute Poker cheating scandal also took place, is a paper tiger. Two, that the sooner the kinds of online games are run from within the U.S., where they can be subjected to rigorous federal oversight, the better.

Would the last person to leave Nevada please turn out the lights? Revenue shortfalls continue and Gov. Jim Gibbons' peeps are now talking in terms of a 30% state budget reduction. Maybe they can sell pencils out of tin cups as passengers arrive and depart from McCarran International Airport.

Obama-, McCain-themed slots

Tue, 04 Nov 2008 17:01:00 -0700

Although the Democrat's game of choice is poker and the Republican is famous for his love of craps, they'll have to settle for appearing on slot machines. A hearty "bravo" to Ian Sutton for finding this bit of must-see TV:

And the winner is ...

Tue, 04 Nov 2008 13:31:00 -0700

Regardless of who comes out on top in today's presidential tussle, there's one group of Americans who can be assured of a brighter future -- Native Americans. The Bush II administration's record on tribal affairs has run the gamut from "dismal" to "abysmal." Any form of regime change, whether to McCain or Obama will be a de facto improvement.

In late 2000, one of George W. Bush's first mooted cabinet appointments would have placed Slade Gorton, an outspoken opponent of tribal sovereignty, atop the Department of the Interior (and thus the Bureau of Indian Affairs; as overheated as this rhetoric is, it gives you a fair idea of how Gorton is regarded in Indian Country). That was such an obvious give-the-finger-to-the-Indians gesture it didn't get anywhere, but the tone had been set.

Nothing was more emblematic of this new Washington mentality than the National Indian Gaming Commission's attempt to force tribes to unilaterally surrender literally decades of hard-won legal gains. The NIGC proposed to do this through a new and narrower definition of what constitutes "Class II" gaming. In one of the few positive developments to emerge from the recession, the NIGC felt compelled to set this Uncle Tom policy aside.

That also must have come as a relief to the numerous vendors who service the Class II market and who would undoubtedly have seen their sales decimated by the new NIGC rules. (At the time they were being hatched, NIGC officialdom made it amply clear to me that it was going to be their way or the highway, and the tribes had better be prepared to fall in line. Unfortunately, "the Google" has failed to yield the article I wrote about the Class II battle back when it was heating up in earnest.)

Come Nov. 5, with any luck, those new Class II regs and the current NIGC leadership will consigned to the Slade-heap of history.

They can't be serious

Wed, 29 Oct 2008 11:50:00 -0700

Ian Sutton, over at GamingFloor.com spotted this, probably cobbled together on the quick, in the wake of CBS News' sloppily done piece on Sen. John McCain's popularity within the casino industry:

OK, the McCain+Paris Hilton+Britney Spears linkage is an amusing bit of payback for the famous "celebrity" spot. The rest of the ad is somewhere between disingenuous and deceptive. "More casinos"? That's a state-level issue, one that never shows up on presidential radar even from a distance. This is a stupid scare tactic that you'd have to be mighty gullible to buy.

"A million in campaign cash"? Try $951K at most. And the $133K donated to Sen. Barack Obama is somewhat more than chicken feed, too.

It might be possible to make a tenuous case that a President McCain could (help) enable more tribal casinos -- he's received $62,950 from the Mashantucket Pequots and two other tribes -- but the ad's glib McCain=Vegas equation forfeits that line of argument. Of course, the question of why donations from casinos are inherently more sinister than those from Fannie Mae, Freddie Mac, military contractors, oil companies, pharmaceutical firms, tobacco growers, HMOs, etc., is simply begged.

That '527' ad, though, is downright subtle when compared to this ham-fisted ploy, complete with eerie sound effects. Oooh, those spooooooky casinos! They're coming to get us!!!

If you're going to try and make hay of McCain's relationship with the casino industry, shouldn't you at least derive a metaphor, however hackneyed it may be? (Acoustic guitars should be banned from all Democratic Party and left-leaning ads, by the way.)

When you consider that Bill Clinton's administration flirted with a federal gaming tax and the Bush the Second floated the notion of using casinos to collect delinquent child support, it's only common sense that the casino industry would like to have the next president's ear. And since when did it have to forfeit its First Amendment rights to support the candidates of its choosing?

Besides, the GOP prospects already being touted for 2012 -- Mike Huckabee, and governors Sarah Palin and Bobby Jindal -- are anti-gambling across the board. (Huckabee's proposed tax policy would be downright punitive to casinos and their suppliers.) Small wonder that casino CEOs want McCain to succeed.

Case Bets: Sands bankruptcy?; California spite, Ted Binion still dead, etc.

Fri, 24 Oct 2008 17:52:00 -0700

The 'B' word. Yup, somebody finally said it. Stifel Nicolaus & Co. analyst Steven Wieczynski blames The Big Sands Sell-off on fears that "Las Vegas Sands is in jeopardy of running out of cash and going bankrupt." Sands stock closed the week at a dismal $6.32 a share, 96% off its 52-week high.

The Adelson family, meanwhile, plans to turn its pockets inside out, looking for money.

Gary Jacobs is a good guy. The MGM Mirage executive veep is among the donors supporting California's Proposition 2, which would ban certain forms of cruelty to farm animals. Which earns him this animal lover's vote of thanks.

Other Nevadans are really motivated to donate to Proposition 8. Steve Friess has all the details. Having shot Nevada's economy in the leg with their opposition to gay marriage, some of the same folks may inflict similar economic damage on California. Which is their First Amendment prerogative and amen to that, but I'm not of the misery-loves-company persuasion.

Nevada's casino resorts have been cut out of on a lucrative market segment, although Harrah's Rincon has been among the California ones benefiting from Silver State prudishness, which Harrah's Entertainment has cannily leveraged into some Vegas-honeymoon promotions. If tribal sovereignty doesn't shield Harrah's Rincon and other gay-friendly casinos from Prop 8, I guess that Prop 8 donors from economically blighted Nevada can congratulate themselves on having lopped off their nose to spite their face yet again. Anyway, kudos to Harrah's execs Michael Weaver and Gwen Migita for contributing to the anti-Prop 8 campaign.

Marker for murder? Back where I come from, we call this "motive."

Time Tunnel. How drastically has the Vegas Strip changed since 1992? Follow this awesome photo stream and find out.

This just in: Made-for-cable movie about Lonnie "Ted" Binion stinks. Hey, it's a Lifetime Channel production. What else would you expect?

Harrah's dodges $5 billion bullet

Thu, 23 Oct 2008 13:31:00 -0700

Wire services report that the Second Circuit of the U.S. Court of Appeals has ruled against the St. Regis Mohawks in their attempt to collect a $5 billion damages-plus-interest award levied in 2001. Harrah's Entertainment inherited this potential burden when it purchased Caesars Entertainment, as the original litigation had gone against Caesars precursor Park Place Entertainment. The Second Circuit held that PPE hadn't interfered with the Mohawks' casino-development plans in New York's Catskills region.

Harrah's undertook quite the gamble when it acquired this lawsuit. Given the dollar amounts involved, even settling out of court (if that was ever a viable option) could have been prohibitively expensive. It was a win-or-else situation and, unless the Mohawks elect to appeal, the outcome is a shot in the arm that Harrah's really could use right about now.

McCain a lousy player?

Fri, 10 Oct 2008 16:40:00 -0700

Citizens for Ethics & Responsibility in Washington wants an accounting of Sen. John McCain's casino winnings. He was seen raking in "thousands of dollars" at Foxwoods Casino Resort. But that was back in 2000. He's declared no casino winnings for '06 and '07.

Not John McCain.

I hate to rain on CREW's parade but maybe McCain hasn't had any pots worth reporting. We know he's a craps player but nobody ever said he was an especially good one and he's certainly no Archie Karas.

Happy anniversary, you're fired

Mon, 06 Oct 2008 15:48:00 -0700

That was essentially the message conveyed to several dozen workers at MGM Grand Detroit as the hotel-casino passed its first anniversary. Such cutbacks are usually routine in the industry and this one affected but a fraction of a percentage of the casino's workforce. But it's a heckuva way to say, "Happy anniversary!"

It's also an indicator of how much our economy has soured that MGM Grand Detroit is having to curb staffing even though it's by far the dominant player in the Motown market. Still, its workforce reduction is microscopic compared to the cuts coming up at Harrah's Entertainment (whistleblower Fred Frazzetta, who knows a thing or two that Harrah's management wishes he didn't, says 20% of Harrah's Vegas-based workforce will be decimated). Then there's Mill Casino, in Oregon, which opened a new hotel tower in the teeth of a recession. The result? A 7% workforce diminution, the first in the casino's 13-year history. Small wonder that Atlantic City is preparing to backpedal on its Oct. 15 smoking ban.

Wall Street has been no help. Liz Benston explains why several gaming companies' market-cap value is a fraction of that of their asset base. The casino industry's debt loads and ambitious construction plans are giving investors jitters, Benston reports. Ironically, the same Wall Street that has loudly pined for a never-ending stream of megaresort openings would now be happier if those same companies were doing nothing. Worse still, the gaming group is one of the few sectors that can be shorted with impunity. So if gaming stocks continue to plummet, it's partly because it's in some investors' interest that they do so.

Boyd's Michigan nemesis, Four Winds Casino is profiled by the Columbus Dispatch. It's a close-up view of the tribal casino that's taken a whopping big bite out of revenues from Boyd Gaming's Indiana riverboat, Blue Chip, basically by pre-empting the latter's Michigan-customer base.

Second wind in Maine. While developer Gary Goett's Olympia Gaming may have found the Las Vegas and Kansas markets too rich for its blood, at least for now, Maine is a whole 'nother story. Since Olympia threw in its lot with a pro-casino initiative, momentum has shifted in the project's favor.

Mohegan Sun in Kansas: D'oh!

Mon, 22 Sep 2008 11:26:00 -0700

A reader in Oklahoma City points out an obvious reason -- one which I somehow managed to completely overlook -- why the Kansas Lottery's casino-selection panel didn't go with Mohegan Sun, which I foolishly thought to be a prohibitive favorite. To wit: Most casinos in the central U.S. are tribally owned, so why use the auspices of the state to establish yet another one? The 2007-08 edition of Casino City's Pocket Gaming Directory lists five tribal casinos in Kansas and, hindsight being 20/20, it now seems obvious that there was no enthusiasm for adding a sixth, at least when your projected revenue is the lowest of any of the proposals on the table. (Mohegan Sun is the only Kansas applicant to have received no votes for its proposal.)

In a rare visit to Planet Earth, the Las Vegas Review-Journal's editorial page weighs in on smoking bans in Atlantic City and Illinois, and their deleterious effects on revenue. Judging from the well-researched nature of the piece and its novel (for R-J editorials) employment of actual facts, it must have been written by somebody conversant with the issue, like Howard Stutz.

... at least until the final five paragraphs, where it devolves into stale invective, and even rails against Nevadans' decision to ban smoking in restaurants and supermarkets. (The effrontery of those voters!) The salient fact that Atlantic City banned casino smoking because the city's gambling halls did almost nothing to comply with a smoking restriction -- basically daring the city to take action -- is also conveniently omitted. It's as though the first 14 paragraphs were written by an adult, whereupon the pen was commandeered by a tantrum-prone infant.

Update: The owners of the El Cortez have declined to comment on the allegations made to S&G by minority owner Lonny Zarowitz. A query to the Nevada Gaming Control Board remains unanswered at this time.

Kansas, Round 2: It's Cordish!

Fri, 19 Sep 2008 14:59:00 -0700

OK, I was wrong. Incredibly wrong. As you'll hear on the next Vegas Gang podcast, I stuck by my prediction that Kansas' largest casino contract, the one for the greater Kansas City area, would go to Mohegan Sun. Why? Biggest budget, most amenities, a track record of large-scale casino development. At least I covered my butt by saying that Cordish Cos.' piggybacking of their proposed casino onto the Kansas Speedway gave them "dark horse" status. Also, franchising the casino under the Hard Rock brand was not to be gainsaid.

A racino of a different stripe

So when the winner was announced today, Cordish was it. While Mohegan Sun was willing to put a bigger investment ($740 million vs. Cordish's $680 million) on the table, Cordish's synergy with the Speedway appears to have done the trick. They'll whip up a temporary casino (2K slots, 75 tables) sometime next year, to get the cash flowing while the full-scale project rolls toward a 2011 debut.

Here's the real shocker: Mohegan Sun got zero votes, primarily because state consultants projected its revenues as the lowest of the three proposals remaining on the table. (Pinnacle Entertainment and Las Vegas Sands has already withdrawn from the fray. With a major project underway outside St. Louis, plus others in holding patterns in Atlantic City and Baton Rouge, Pinnacle's chances seemed remote. It's difficult to imagine Kansas being willing to take a place at the back of that queue.)

Which means that three of the seven votes went to -- surprise! -- Golden Gaming, a company whose chances I will freely admit to having severely undersold. It says a lot for CEO Blake Sartini's reputation and for Golden's presentation that it came within an ace of winning, despite having a relatively modest track record -- at least nothing remotely approaching the $662 million casino it proposed to build. With Penn National having sulked its way clear out of Cherokee County and the Kansas lottery board starting to display skepticism toward the Ford County bidders, Golden has at least one, maybe two more opportunities it could pursue in the Sunflower State.

Ten months ago, at the time its casino empire was starting to collapse, Columbia Sussex announced that it had sold the Horizon Vicksburg to casino investor Nevada Gold for $35 million. Seems now that it's yet another William J. Yung III transaction that's (pardon the pun) gone south, following the cancellation of the sale of Casino Aztar to Eldorado Resorts.

Juding from the language that ColSux successor Tropicana Entertainment "have been in discussions regarding a possible alternative transaction" without avail, it appears as though new CEO Scott Butera wants to hang onto the riverboat property (whose on-shore facilities are leased, not owned, by the way -- a common ColSux practice). "(N)o alternatives exist that are suitable to both parties" sounds like a nice way of saying that if any other TropEnt properties were worth having, then they weren't on the table. Then again, given Nevada Gold's current financial situation, it might have been the one getting cold feet, but the formal language doesn't encourage that interpretation.

Either way, Butera's been making some expansionist noises of late and pining for the return of the Atlantic City Tropicana. While Butera has operational experience in that market, from his days at Trump Entertainment Resorts, it's exceedingly difficult to imagine New Jersey regulators letting TropEnt back onto the property so long as Yung has one thin dime of equity in the company.

Quote of the Day

Fri, 12 Sep 2008 17:20:00 -0700

"2 Years, 2 years, 2 years! They fought for 2 years instead of moving. That's 2 years without any income and nothing gained in popularity. I hope in the next 2 years they start to realize working together with groups is better than trying to sledgehammer to get their way." -- "Roy" from Plainfield, Conn., responding to a story in The Day (New London) about Foxwoods' proposed relocation of its Philadelphia casino. Foxwoods' original timeline envisioned a Fall 2008 opening.

Correction: The original post said "2009." I apologize for the error. Also, regarding "Train to Nowhere," the Las Vegas Monorail sells "locals" fares for $1 each (less than the CAT bus). Unfortunately, this has not produced the desired upturn in ridership.

Rapid response; Riviera automates

Mon, 08 Sep 2008 14:14:00 -0700

That was quick. Scarcely had a posted a query regarding the difficulty of finding an out-of-town newspaper in Las Vegas than back came the following response:

"Tell the good folks that you can buy newspapers from the stand out front of Egg And I. We found it a year ago and eat all our breakfasts there whenever we fly into Vegas. If they don't know about this small locals restaurant, they are missing a real treat."

On the subject of eggs, Liz Benston gets a rare, behind-the-scenes look at how the Riviera is making ends meet. Solutions run the gamut from mechanizing the check-in process and centralizing F&B purchases to requiring execs to make do with fewer techno toys. Some moves were unsurprising (layoffs) while others were counterintuitive (reducing the number of slots) but effective.

But the one really off-putting economy is the Riviera's new reliance on Quick Cuisine, a staple of the military mess hall, in its first-ever deployment along the Vegas Strip. Unlike the Bass-o-Matic, it doesn't slice or dice, but the Quick Cuisine "can create and dispense sauces of varying thicknesses and serving sizes, including gravy for a turkey sandwich, spicy tomato sauce for a platter of spaghetti and industrial-sized servings of eggs and oatmeal. Using a process similar to freeze-drying, the manufacturer reduces homemade foods to powders that are reconstituted when they’re mixed with water heated to more than 200 degrees."

Powdered eggs? Blech! Whatever things I'm doing at the Riviera in the future, eating there won't be among them.

Casino Jack strikes again. Yet another Washington lobbyist discovers that his association with Jack Abramoff has toxic consequences.

Dave Schwartz elaborates on his denunciation of Pinnacle Entertainment (see "Comments"). The -- pardon the pun -- money quote is: "The way I see it, this guy is paying his taxes and providing some kind of economic life for the city. More importantly, it’s his store. The wonderful thing about America is that if he doesn’t want to sell it, he doesn’t have to."

Amen to that.

Speaking of Pinnacle, its Atlantic City project is on hold for at least one more year. But if they company has already sunk $400 million into the former Atlantic City Sands site, I'm thinking it's a better-than-50/50 shot they'll move forward on the project. If the city council was amenable to selling Bader Field (which could hold as many as five casinos) starting at $800 million, expecting to garner half that amount by flipping one casino site would seem awfully optimistic.

Casino Jack slimes McCain

Thu, 04 Sep 2008 17:22:00 -0700

That's our guy, a class act to the end.

Washington's vilest lobbyist -- and that's going some -- got his due. Well, maybe not quite. Four years and (apparently) no forfeiture of assets is probably a more lenient sentence than "Casino Jack" Abramoff deserves, but it's more than prosecutors wanted, so it's all good.

Besides, as Abramoff wailed to the court, "My name is the butt of a joke, the source of a laugh and the title of a scandal." As well it should be, especially in light of the collateral damage Casino Jack's finaglings did to the image of Native American tribes lobbying Congress (not to mention the damage to the treasuries of the tribes he and co-conspirator Michael Scanlon bilked).

It's hard to muster much pity for someone who's just helped pen a book in which he's a martyr, the blameless victim of the evil, conniving Sen. John McCain and McCain's nefarious fellow-travelers, The Washington Post. (The WaPo did more than any other news organization to chronicle Abramoff's myriad crimes, so you can understand why he's not feeling any love right now.)

According to The Associated Press: "In The Perfect Villain: John McCain and the Demonization of Lobbyist Jack Abramoff, Boston journalist Gary Chafetz portrays Abramoff as an innocent man who excelled in an already corrupt system and was undone by biased prosecutors, reporters and political enemies."

I can review that book, sight unseen, in one word: Bullshit.

Speaking of taxes ...

Thu, 04 Sep 2008 12:44:00 -0700

Atlantic City's high pajandrums are contemplating permitting as many as six new casinos (not counting Revel or the on-hold Pinnacle Entertainment project), further diluting a challenged market. Does this mean the existing casinos will get a commensurate reduction in their tax rate?

Why do I get the feeling the answer to that question is a scornful, "No"? Serves me right for applying logic to the situation.

Casino companies' best argument for keeping Nevada's privilege tax rate the lowest in the nation is that, theoretically, there's no limit to the number of casinos that can be built in the Silver State. Conversely, a market where casinos are limited by statute -- let's use Detroit as an example -- can justify a higher impost, especially since the government is providing a protected oligarchy for a handful of operators.

But were Detroit, say, to lessen the oligarchy by allowing in a fourth or fifth operator, it's only reasonable that everyone involved gets a tax break. After all, they're going to be divvying the same customer pie into smaller slices. Governments, unfortunately, tend to think that More = More, so that's never gonna happen. But it should.

While we're on the subject of Detroit, it required a vaudeville hook the size of a construction crane, but America's biggest political embarrassment is finally being dragged from the stage. Back when I was covering the awarding of Detroit's three casino licenses, the surrounding intrigue took such bizarre turns that, were it a novel, it would be deemed too lurid for credibility. Now, thanks to the stranger-than-fiction antics of Kwame M. Kilpatrick, Las Vegans have something new about which to feel smug, as the bumpy mayoralty of Oscar Goodman looks quaint and wholesome by comparison. (I like Oscar but he has his, uh, moments.)

"we need to get some $ from those Monkeys!!!!" Yes, everbody's favorite scumbag and slime bucket, "Casino Jack" Abramoff is back in the news today (in which Sen. John McCain makes a cameo appearance as one of the good guys). The quote above is from one of Abramoff's many infamous e-mails -- which McCain helped bring to light -- and the "Monkeys" are Native Americans, in case you were wondering.

Casino Jack is scheduled to be sentenced today on more of his seemingly endless litany of crimes. "I am not a bad man," Abramoff writes to the judge. No, Jack, you are a bad man and I hope the judge throws the book at you.

Alaska nixes gambling; Politics here, Harrah's there

Tue, 02 Sep 2008 20:41:00 -0700

With Alaska and its governor all over the news of late, I got to wondering what had become of that ballot initiative, backed by bar owners, to expand gambling in Alaska.

As it happens, the initiative was voted down, the most lopsided defeat for the casino industry in a year of setbacks, following legislative rebuffs in Kentucky and Massachusetts. It did, however, prevent discomfiture for one opponent -- Gov. Sarah Palin, who would have been required to appoint the members of the proposed Alaska Gaming Commission, had it been voted in.

If you're scoring at home, that's: Palin 1, Slot makers 0.

Politics Makes Strange Bedfellows Dept. Although the largesse of MGM Mirage tends to flow towards the GOP, one of its prime beneficiaries this year is Rep. Carolyn Cheeks Kilpatrick (D-MI). Meanwhile, the war chest of unopposed Rep. John Conyers (D-MI) has been swelled by donations from Phil Ivey and Doyle Brunson.

Conyers is seen as a critical ally in the move to overturn the UIGEA, that midnight raspberry blown to online poker players by then-Senate Majority Leader Bill Frist (R-TN) and Rep. Jim Leach (R-IA). Frist retired soon afterwards and voters -- probably including some pissed-off poker players -- sent Leach packing.

Swift Harrah's verdict? We may not have to wait long for a ruling on Harrah's Entertainment's legitimacy to build and run a casino in Kansas. There's the little matter of a disputed non-compete clause with the Prairie Band of Potawatomi Indians, who formerly made use of Harrah's managerial experience before the latter severed ties. However it comes out, a speedy resolution is to be hoped for. It's going to take the Sumner County casino two years to get up and running anyway, even without being ensnared in litigation.

Casino woes hit tribal turf

Thu, 28 Aug 2008 14:18:00 -0700

Construction at two Seneca Gaming Corp. projects in New York State has ground to a halt. The stoppage is blamed on "challenging economic and capital market conditions, greater demands on the company's available cash and increased competition and construction costs.''

Sound familiar? What happens at Echelon not only doesn't stay there, it may be coming to a casino market near you sometime soon. In the Senecas' case, the National Indian Gaming Commission is threatening to cut off their part of the flow of casino cash altogether. But it still adds another casualty to the list of scrapped, frozen, delayed, bankrupt or scaled-back casino projects around the country.

Newest casualty: Seneca Allegany Casino

It's been a longstanding fundamental of casino development that it was self-sustaining: the more supply, the greater the demand. Wall Street analysts never thought there was anything wrong with Las Vegas that wouldn't cured by "the next round of megaresort openings." (If they had their druthers, we'd be opening a new one every week.) Hence the long queue of states wagering greater and greater amounts of their fiscal health on casino taxes.

As the state of Nevada is learning the hard way, the elasticity of casino-revenue growth is finite -- and tightening. Since that's the lone arrow in the Silver State's financial quiver, we're going to feel the pain worse than other states, but other legislatures and governors are going to wake up the fact -- if they haven't done so already -- that the casino industry isn't just some magical pump from which an infinite and ever-larger gusher of money doth spout.

Speaking of matters tribal, it'll be a poke in the eye with a sharp stick to Native Americans if Minnesota Gov. Tim Pawlenty is the GOP veep pick. During his tenure -- I was going to follow that with "in the governor's mansion," but Pawlenty refuses to live there, actually -- he's been a divisive figure on the tribal scene, pitting Indians against other Minnesotans and against each other. It would be difficult to find a White House more inimical to tribal interests than the current one, but Pawlenty's ascendancy hardly augurs well for the future.

Media event done right. With much grumbling and many misgivings, I tagged along to media night at BLT Burger (and thus finally got to meet lovely MGM Mirage PR stalwart Sandy Zanella, after many years of e-communication). Surprise, surprise: The event wasn't overbooked, the music wasn't too loud, there was plenty of space to sit down, and the food offerings were actually representative of the restaurant's menu. (I'm looking at you, Brand.)

Admittely, the fried pickles didn't come around nearly often enough ... well, only once, actually. But there were generous portions of everything else, and the service was both frequent and solicitous (something that evidently has not always been the case). I'm still unsure what to make of BLT's upscaled versions of diner favorites -- falafel burgers, anyone? -- but it put its best Buffalo wing forward.

"Self righteousness is its own reward." That's what my Dad always told me and it's certainly true of this wretched documentary. By the way, the unidentified woman in the photo is Darlene Jesperson, the bartender that Harrah's Entertainment fired because she wouldn't wear makeup (a requirement, it goes without saying, that was imposed only on female employees). Harrah's beat the rap, freeing it and the rest of the industry to carry on with a plantation mentality that should have been swept out decades ago.

Sailing in DeNile

Mon, 18 Aug 2008 18:17:00 -0700

"We've been impacted by the Seminoles, but we expected that in the first couple of months they began operation. There's going to be a turnaround where people come back and say 'I don't like it there.'" --Stephen McClintock, director of player development for cruise-to-nowhere gambling vessel Palm Beach Princess, the last such vessel in South Florida, commenting on the expansion of tribal gambling into Class III games.

Passenger counts in Port Everglades and Palm Beach have been declining for four years. Meanwhile the multinational, 170-person crew of the SeaEscape is confined to quarters, having gone unpaid for weeks, their travel documents confiscated.

Quote of the Day

Mon, 18 Aug 2008 15:18:00 -0700

"We talk as if it's all gloom and doom and no one is buying [slot machines] ... The American Indian casinos are still buying. On the East Coast and in Pennsylvania, with all those expansions, people are buying. The new product is still going out and there's still a good demand for it." -- Bally Technologies COO Gavin Isaacs, on the economy.

Trop turnaround?

Tue, 12 Aug 2008 13:14:00 -0700

While the New Jersey Casino Control Commission continues to bobble the sale of the Atlantic City Tropicana, at least its stewardship has arrested and perhaps finally the property's decline. While a 5.5% decline in business is nothing to crow over, only Caesars Atlantic City lost less ground, down 4%.

Of course, nobody did remotely as well in dollar volume as the newly augmented Borgata. Whatever struggles Boyd Gaming has experienced in cracking the top, er, echelon on the Las Vegas Strip, it's had the rest of the Atlantic City market playing catch-up, mostly without success, for five years now.

As for the Trop, its gambling revenues are still just keeping pace with Showboat Atlantic City, a property with 7% fewer slots and half the poker/table game capacity. So, while the NJCCC has largely stanched the bleeding, the problem of an attenuated market share remains. Thanks, Columbia Sussex. Don't let that doorknob hit you on the way out.

But the Trop's doing way better than Trump Marina, whose owners -- coming off a wretched quarter and not yet having booked the $316 million they're getting for Trump Marina -- are merely considering using the money to pay down debt. After all they could "look elsewhere for growth opportunities" -- like Panama. (I kid you not.) That's quintessential Donald Trump: Don't address your problems; just run away.

(Presumably the new "Chairman" tower at Trump Taj Mahal is supposed to evoke the glowering, orange-haired Trump himself. But, if you grew up in the Sixties, "the Chairman" was Mao Tse-tung or maybe -- if you were just a few years older -- the Chairman of the Board himself, one Francis Albert Sinatra. I guarantee that no one will ever call Trump "the Chairman." Ever.)

Golden Heartland: Coming soon-ish to a Kansas near you?

Golden Gaming's PR peeps contacted me to very politely dispute my characterization of Golden as a probable also-ran in the Kansas casino sweepstakes (see "Don't tax me, bro!"). They pointed to CEO Blake Sartini's 15 years in the upper ranks of Station Casinos, his 40-tavern operation in Nevada, the Pahrump Nugget and a trio of Black Hawk, Colo., casinos (with an aggregate of 778 slots and no table games).

I would respond that Golden's most imposing rival in Kansas, Mohegan Sun, probably has a larger installed slot base in its Connecticut casino alone (a mind-boggling 6,199 one-armed bandits) than Golden probably has in all its 40-plus properties rolled together. That Colorado is the minor leagues, casino-wise. That all those taverns, nice as they are (and they're some of the very poshest in Nevada), amount to one big-ass slot route -- no disrespect intended. And that we're talking about a $600 million casino-resort contract -- far, far bigger than anything Golden has attempted.

Bottom line: I still think Golden is very much the underdog in Kansas. In fact, I'm even more convinced of it. Which isn't to say it won't pull off a stunning upset. But, given the scale of operation that the State of Kansas wants to see, Mohegan Sun's resumé makes the most logical fit.

Don't tax me, bro!

Wed, 06 Aug 2008 18:19:00 -0700

Guess who's kvetching about his property tax bill? Why it's our old buddy, Columbia Sussex CEO William J. Yung III -- or at least his surrogates at Horizon Vicksburg. It's been the better part of a year since Yung announced the sale of this riverboat to Nevada Gold, yet the deal still hasn't closed. (Too bad, because the promise of that $35 million was being used to palliate angry debtholders last winter.)

Even though Olympia Gaming and Las Vegas Sands have bailed out of their respective pursuits of casino ownership in Kansas' Wyandotte County, two Vegas-based companies are still in the running. Pinnacle Entertainment has a lot of irons in the fire already and its wait-and-see attitude toward Atlantic City development may not be what the Kansas Lottery Gaming Facilities Review Board (now there's a mouthful!) wants to hear. Golden Gaming's experience, a brief stint at the Vegas Hard Rock Hotel & Casino aside, is of the small-scale variety, which may also provoke skepticism.

While tribal powerhouse Mohegan Sun is hurting on the Uncasville homefront lately, it's coming off a solid performance in Pennsylvania. I like its chances. Cordish Cos., whose pursuit of the Atlantic City Tropicana was recently rebuffed (for no good reason), is obviously itching to get into the casino industry in a big way. Perhaps its proven track record as a developer will outweigh its inexperience in the casinosphere.

Isle reduces risk in Florida

Tue, 05 Aug 2008 15:37:00 -0700

As we're seeing, it's not always a bad idea to scrap or delay an expansion. Such is the case with Isle of Capri's decision to allow the expiration of an agreement with Florida Gaming Corp. to turn Miami Jai-Alai into a slot parlor. Isle couldn't even be bothered to announce the news. (Can't imagine why.)

With the various Seminole casinos ramping up their offerings something fierce, Isle has its hands full defending market share at Pompano Park. The non-tribal Florida market just hasn't been the bonanza anyone expected and Boyd Gaming's decision to hold off converting its own jai-alai fronton now appears prescient. Wall Street reacted favorably, with ISLE continuing to trend upward.

Perhaps we should have foreseen this. The Seminoles had a track record, a customer base, a brand name (Hard Rock) -- and now they have table games. Newcomers to the market had a tough row to hoe before and now it looks darn near impossible, unless the Seminoles have to revert to Class II gaming (and that's unlikely to happen anytime soon). Florida Gaming Corp., meanwhile, will try to find other takers for its faded fronton. Good luck with that.

Bury this in Boot Hill. It looks like yet another Kansas casino proposal may be about to bite the dust. Butler National Corp., a manufacturing concern that's trying to take a flier into casino ownership (shades of Galaxy Entertainment, right to down to renting the Navegante Group braintrust) is pitching a low-budget, smallish (800 slot) casino. Trouble is, Butler's a wee bit short on cash and needs an equity partner who will rescue the project but agree to take a back seat.

From Rick Alm's description, this is a Hail Mary play by a penny-stock company -- a big red flag. However, the Boot Hill Casino that Butler is proposing for Dodge City sounds far more aesthetically appealing that the tacky-looking, theme-park-ish competing proposal. But the latter has the not-inconsiderable advantages of a larger upfront investment and previous in-house casino experience.

If would-be casino operators keep dropping out at the present rate of attrition, the lottery commission's selection process will become downright Darwinian.

Ameristar: What makes sense?

Fri, 01 Aug 2008 14:45:00 -0700

Perhaps this is what happens when you outsource your business coverage to India, but Reuters had a story yesterday positing MGM Mirage and Harrah's Entertainment as two of the likeliest buyers for Ameristar Casinos.

Uhhh, I hate to break this to Reuters, but MGM just came up $3 billion and change short on CityCenter and Harrah's is debt-strapped. So I'd say they've got their hands full. How either one would be able to swing an Ameristar acquisition is an open question. Harrah's also faces redundancy issues, as it already owns riverboats in three of Ameristar's key markets -- Council Bluffs, Iowa, and St. Charles and Kansas City, Mo. Why MGM would feel a sudden hankering for Black Hawk, Colo., plus a brace of casinos in Jackpot, Nev., is even more of a poser.

Reuters' third suggestion, Boyd Gaming, seems a lot closer to the mark. With Echelon temporarily in the deep freeze and Boyd's Blue Chip riverboat leaking market share, a passel of regional casinos in markets where Boyd doesn't currently operate could provide welcome cash flow, shore up the company against its current non-presence on the Strip, and expand the web of properties from which Boyd could funnel players into its downtown Vegas cluster or (eventually) Echelon. Of course, Boyd may still be smarting from a failed Kansas City venture a decade ago, but Ameristar's assets are proven performers.

Besides, it's a company that could use some helmsmanship, having seemed to drift since the demise of CEO Craig H. Neilsen. Although paralyzed from the neck down and often bed-bound (which I've heard resulted in some very unconventional corporate meetings), Neilsen achieved more from the neck up than most able-bodied people do in their entire lifetimes. His successor, ex-Harrah's exec John Boushy, tried to sell the Ameristar people on a change of corporate culture but they didn't want to hear about it. So, given an evident leadership vacuum, a change of ownership makes sense.

Unless Penn National wants to take its $1 billion-plus in "mad money" and go after Ameristar, there aren't too other many potential acquirers abroad in the land. James Packer has already sworn off. Pinnacle Entertainment would rather build than buy. Tribal giant Mohegan Sun has been flexing its financial muscle of late and rates as a longshot candidate (but just came off a wretched second quarter). Beyond that ... who knows?

"I spent $2 million ... "

Thu, 17 Jul 2008 17:30:00 -0700

" ... and all I got was this lousy kick in the pants from the Massachusetts Lege."

South Coast Today.com has tallied the lobbying expenditures from a failed casino push in the last Legislature and it sets a new record for pro-casino spending the Bay State, doubling what the industry invested in lobbying back in the halcyon days when William Weld was running the state (although those numbers may have been lowballed: the laws for registering as a lobbyist in Massachusetts were looser back then).

The big spenders were (drum roll, please) ...

Suffolk Downs: $500,000

The Mashpee Wampanoag Tribe: $221,000

Trump Entertainment Resorts: $162,000

The Wampanoag Tribe of Aquinnah: $120,000

Harrah's Entertainment: $87,500

Northeast Gaming Group: $45,000

Mohegan Sun: $21,000

Suffolk Downs was particularly catholic with its expenditures, spreading them across seven lobbying firms. Given the high profile of Sheldon Adelson as one of Gov. Deval Patrick's casino advocates, and the fact that Las Vegas Sands commissioned its own cost/benefit study on Massachusetts casino development (one that showed Patrick's economic projections to be on the rosy side, ironically), it's surprising that Sands does not show up as one of the heavy spenders.

Expect Round II of Patrick's big casino push to start kicking into gear after the election.

Indiana: It sure could be worse

Tue, 08 Jul 2008 21:00:00 -0700

... because you could be Illinois, where June gambling revenues went into the toilet (-21%). Which isn't to say that Indiana's numbers look good only by comparison. In fact, the Hoosier State may be benefiting from the Land of Lincoln's misery. It's sort of a "Yes, but ..." situation.

Yes, Indiana would be a lot worse off (-12%) without two new racinos, Hoosier Park and Indiana Live. Their addition has kept gambling revenues virtually flat from June '07. And that's two flat months (as in variance of less than 1%) after eight months of declines. In terms of gross, Hoosier Park vaulted into the #5 spot, while Indiana Live checked in at #9.

Yes, northern Indiana initially looks like it got clobbered (-11.5%). But once you back out Boyd Gaming's Blue Chip riverboat -- which is something of a special case -- the picture improves considerably. All northern riverboats except Resort International's are down, but not on average as much as the southern Indiana riverboats.

All of which suggests that gamblers fleeing Illinois' new smoking ban are taking refuge aboard the northwest Indiana boats. Blue Chip, which is the closest one to the tribal Four Winds Casino Resort, across the Michigan state line, is really taking it on the chin: -39.7% in June. Boyd's struggles here -- and with its Florida parimutuel (which isn't even shown on the company's official Web site) -- make it tempting to call for retrenchment. But, in the case of Blue Chip, it's on pace for $190 million in revenue, which is scarcely chump change ... good enough for the #6 spot in statewide gross.

Dollarwise, Harrah's Entertainment's Horseshoe Hammond now enjoys the top spot, once the exclusive preserve of Penn National's Argosy Lawrenceburg. The latter, however, still has bragging rights to the largest slice of market share (just under 12%, according to the Indiana Gaming Commission) in the state.

Amongst the southern Indiana casinos, only Pinnacle Entertainment's Belterra enjoyed [sic] a single-digit decline in June, while almost everyone else suffered double-digit slumps.

The lone gainer was -- surprise! -- Columbia Sussex's Casino Aztar, up 2.5%. A recent, regulator-placating, promotion-friendly change of administration at Casino Aztar may be the X factor here, as the riverboat followed January-April declines with two months of gains ... the only casino in the state to post that pattern. (Resorts Int'l must really be onto something, what with five straight months of growth in the teeth of an adverse economy.)

Casino Aztar's gain appears to have been French Lick Casino's loss. The lowest-grossing casino in the state, its novelty factor may have worn off, as it's down by almost 25% in June. Then again, French Lick's numbers have been all over the place this year, so who knows? However, it was perceived as the primary competitive threat to Casino Aztar, a challenge that may now have been blunted. We'll see.

And can anybody tell me why two adjacent casino boats, owned by the same company (Don Barden's Majestic Star and Majestic Star II) can have such disparate results? One is off by 4% while the other is down 13%. Then again, who can explain anything Barden-related these days?

Barden in Pittsburgh: Harrah's out, SugarHouse in

Tue, 01 Jul 2008 12:20:00 -0700

That "juice job" that is Don Barden's Majestic Star casino project in Pittsburgh still has a pulse, even though contractors walked off the job yesterday as threatened. Chicago real estate developer Neil Bluhm is willing to chip in $120 million. Since Bluhm is the top dog on the SugarHouse casino project in Philadelphia, he can only be a minority investor in Majestic Star -- but what a minority! For $120 million, Bluhm gets 33% of a $780 million casino ... no small index of Barden's desperation.

Bluhm also hip-checks Apollo Management, co-owner of Harrah's Entertainment. Apollo had contemplated loaning $150 million which, presumably, could have been rolled into an equity stake. (As with Bluhm, Apollo is precluded from majority ownership in a second Pennsylvania casino.) However, Barden is still $30 million shy of his target number -- and no buyers have emerged for the Fitzgeralds casino in downtown Vegas, which represents the equity Barden was obligated to commit to Majestic Star.

This whole thing looks more and more like a colossal boondoggle by the day (Majestic Star's proximity to Heinz Field and PNC Park is a traffic nightmare in waiting, and Barden's plan scored a 274 out of a possible 600 from the Pittsburgh Department of City Planning). However, various local- and state-level commissars for optimism -- including the state's gaming commission -- are so nakedly desperate for additional tax revenue that they're willing to overlook the elephant in the middle of the room.

If Bluhm's name sounds familiar, he was part of a consortium that included Barry Sternlicht and which made several unsuccessful runs at Riviera Holdings. (Considering that RIV hit a 52-week low earlier today, perhaps they'd like to try again.) While he and Barden iron out the details, Majestic Star will sit half-finished and idle for as much as a fortnight. There's even a Web cam where you can view the work that is not taking place.

Displaying a rich sense of humor, Barden's spokesman "said the suspension of work should not affect the timetable for the North Shore casino's completion, scheduled for May 2009." What a card!

Elsewhere in Pennsylvania, the state's higglety-pigglety rush to embrace casino gambling continues to unravel (much to the relief of Atlantic City, I'm sure). Even though the state Supreme Court has said he can't relocate Philadelphia's two slot parlors, Mayor David Nutter wants to appoint a commission to study doing that very thing. He could also throw so many bureaucratic obstacles in the paths of SugarHouse and Foxwoods that they either give in and move voluntarily -- or perhaps they take their balls and go home. If Nutter's objections were merely aesthetic, that might be negotiable, but they appear to run much deeper than that.

Just for fun, check out this botched implosion in Florida. Las Vegas may not be tops in every desirable category, but we sure do know how to blow up buildings.

Loophole for Harrah's?

Wed, 25 Jun 2008 17:32:00 -0700

Jurisdiction of tribal courts over lawsuits that include non-tribal members have been curtailed by the Supreme Court. Could this open for a loophole via which Harrah's Entertainment could wriggle out of a $2.8 billion judgment (inherited from Park Place Entertainment)? The company is already wobbling under buyout-related debt without having almost $3 billion more piled upon it.

Slots continue to disappoint at Broward County's parimutuels. They've underperformed from the get-go but now it appears that the introduction of blackjack and table games at Seminole casinos is sucking even more air out of the room. '21' is very early in its novelty phase in Florida, but once they've been to Hollywood (Casino), how are you gonna get 'em back to to the jai-alai fronton?

Harrah's: The Exodus Continues

Mon, 23 Jun 2008 16:05:00 -0700

There's been a slow dribble of vice presidents from Harrah's Entertainment ever since the Apollo Management/TPG Capital buyout took shape. Two more have abruptly jumped ship. What's interesting in the case of Western Region Vice President for Design & Construction Terry Meistering is that she's going straightaway to a competitor -- Thunder Valley Casino, long a dagger pointed at the throats of Harrah's Tahoe/Reno properties. If Meistering had a non-compete clause, Harrah's clearly waived it.

Which is strange, mighty strange. Are both she and outgoing security veep Grant Ashley victims of the leave-no-bean-uncounted mentality that has taken hold under the Apollo/Texas Pacific regime? Or was Meistering allowed to make a speedy exit and soft landing as a way of further sweeping the renegade-remodeling scandal under the rug?

The official explanation points to the former ("Meistering's responsibilities were reduced during the past year as projects in the region were slowed or shelved due to the slowing economy"). If so, whatever long-term benefits are borne of the regime change at Harrah's, the short-term diagnosis is clear: arteriosclerosis.

"Risky" Harrah's; Yanks Heart Seminoles

Fri, 20 Jun 2008 14:29:00 -0700

Reuters reported this week that the debt carried by Harrah's Entertainment "may weaken from already distressed level as heavy capital spending and interest payments absorb cash flows at a time when the casino operator is also facing declining gambling revenues." We've already seen one set of quarterly income wiped out -- and then some -- by costly interest payments and early retirement of debt. One analyst decribes Harrah's leverage as "pushed ... to the limit" with little prospect for improvement. Guess that puts paid to a Galaxy Entertainment acquisition. Not to mention that physical expansion is going to require even further indebtedness. Meanwhile, Wall Street speculates that Harrah's may elect to retire some bonds not with cash payments ... but with even more debt. The cost of insuring said debt is steep, reflective of the fact that "people are pricing in a lot of risk there," according to analyst Christopher Snow of CreditSights. And while analysts like Snow wait to see which way the current downturn in gambling shakes out, they're also fretting over how new infusions of rooms into the Vegas market are going to eat into Harrah's pricing power. Oh, and a slew of notes come due in 2010, when Snow predicts the company will hit "a pretty high wall of maturities starting in 2010 and going through to 2011 and afterward." Harrah's won't fail, predicts a third analyst, "but this is a tough one." CEO Gary Loveman's multi-million-dollar early opt-out clause may be looking very attractive right now. The Harrah's car isn't going over the cliff by any means, but the upside of the Apollo Management/TPG Capital deal still appears chimerical. The New York Yankees are hanging in there like the tough old birds they are. And if you can bear to watch Melky Cabrera's graceless outfield play (a far remove from the gliding elegance of Bernie Williams in years past), then you'll be looking forward to pulling up a table at either NYY Steak or a Hard Rock Restaurant in the House That Ruth Didn't Build, when it opens next year. This joint venture between the Pinstripes and Florida's Seminole Tribe is another tribute to the economic muscle that was nurtured by tribal gaming but is now being flexed in myriad other business arenas. Still, while it's all well and good for the Seminoles to be tapping into the megamillions of the Bronx Bummers, I hope that -- closer to home -- they're showing some love to the Tampa Bay (Devil) Rays, 2008's Cinderella team. If no else is up for a Rays/Angels ALCS, you can at least count me in.

Granite State gasbag

Mon, 16 Jun 2008 16:08:00 -0700

My family used to spend nearly every summer in New Hampshire, scene of some of my happiest memories. Alas, when the Old Man of the Mountains finally crumbled away, some of the falling rock must have conked restaurant owner Tom Boucher on the noggin.

How else to account for the unintentionally hilarious, rhetorically flatulent op-ed he penned for the Union Leader (never a bastion of progressive thought, to be sure). In this lengthy ode to his own perspicacity, Boucher grandly informs fellow citizens that, thanks to a few anecdotal observations of Foxwoods Resort Casino, he has definitely realized that casino gambling would be bad, bad baaaaaaaaaaad for the state that gave us President Franklin Pierce.

While Boucher and his brother enjoyed "good, hearty laughs," they found themselves surrounded by intense, frowning patrons. Worse still, were the casino staff, behaving "like they were under some sort of hypnotized trance of non-emotion and monotone movements." (Wow, I knew you could speak in a monotone, but I never realized you could move in one, too.)

As for the players, many of whom could be observed on the casino floor at the -- Gasp! -- "insanely late hour of 1 a.m.," Boucher notes disapprovingly that "were clearly non-tourist -- locals and people who certainly were not there for pure entertainment as my brothers and I were." (He also claims to be able to diagnose pathological gamblers on sight. Amazing fellow, this Boucher.)

Having beheld all of this -- plus several instances of bad parenting -- our William Jennings Bryan wannabe returns to his hotel room, wakes up his wife and delivers this orotund and wholly implausible stump speech:

"Everything I witnessed tonight confirms why I will never support slots or casinos in our state of New Hampshire. Some of what I saw tonight are reasons why casino gambling is wrong for New Hampshire.

"What started in Vegas should stay in Vegas! I'll gladly pay the $200 plane ticket to fly to Vegas and enjoy gambling entertainment. It works for Vegas, but it's wrong for New Hampshire. Good night, honey."

Oh, snap! I feel so put in my place. And that "stay in Vegas" line -- bet he had to think long and hard to come up with such a novel bon mot. My sympathies, though, go out to Mrs. Boucher. Imagine being married to this sack of hot air. It's enough to make you want to grab a scotch-and-soda, a pack of cigarettes and the nearest slot machine, before settling down for a few hours of "disappointed, frustrated and in many cases, angry" gambling.

Harrah's: Digging to China

Fri, 23 May 2008 17:59:00 -0700

Given the recent freeze-out on new casino operators in Macao, executives at Harrah’s Entertainment might as well be sporting T-shirts that read, “I spent $577.7 million in Macao and all I got was this lousy golf course.” And, in light of Harrah’s considerable debt load, CEO Gary Loveman will have the unenviable task of advising tight-fisted co-owners TPG and Apollo Management what to do next with their expensive piece of Chinese real estate.

They could gamble on hunkering down for a few years, taking a low near-term return while waiting for Macao supremo Edmund Ho’s successor to possibly liberalize the enclave’s gaming regime, admitting new corporate players. Or Loveman could try to peddle it around -- probably at a loss, seeing as the land can’t be rezoned for gambling and he’s dealing from a position of weakness.

(A third option, whereby Harrah’s acts as a passive hotel operator as part of a joint venture in which Wynn Resorts or MGM Mirage owns the casino just seems too transparent and disingenuous to get past the current regime, IMO. It’d be obvious a subversion of the “three-plus-three” arrangement, turning it into 3 + 3.5.)

The fate of the golf course is a pressing question only because Harrah’s latest “Consolidated Summary of Operations” contains some scary-looking numbers. When 1Q08 is compared to 1Q07, interest expense has increased threefold (from $185.8 million to $557.6 million). Pile on $211.3 million in early retirement of debt – to reduce those interest payments – and an 11% decline in income from operations and it’s quite a jolt to the balance sheet. In the 1/28/08-3/31/08 period, combined income of $445.5 million was negated (and them some) by $679.2 million in interest expense and early debt retirement.

Then there’s the matter of the shuffling of properties between Harrah’s Entertainment and Harrah’s Operating Co. According to one analyst, it works like this ...

Harrah's Las Vegas, The Rio, the Flamingo, the A.C. Harrah's and Showboat Atlantic City, Harrah's Lake Tahoe, Harvey's and Bill's Lake Tahoe are going into the Entertainment portfolio, to be followed by Harrah’s Laughlin and Paris-Las Vegas. But then Bill’s, Harvey’s and Harrah’s Lake Tahoe, and Showboat are re-shuffled into the operating company.

(What? No mention of Bally's Las Vegas? Hmmmmmmmm. Why does the word "implosion" keep bouncing through my brain?)

In an excellent analysis, Amy Calistri writes, “Reducing interest expense, through the reduction of debt, has to be at the heart of this accounting tangle.” In other words, Harrah’s is positioning itself for a big sell-off, fleeing the Tahoe market and reducing its high Atlantic City exposure, already worsened by good business at Harrah's Chester. Trouble is, Calistri goes on, casino valuations aren’t what they used to be and potential buyers might still find credit scarce.

(The problem with operator consolidation is that it’s taken a lot of potential buyers off the table – no more Argosys out there -- although Ameristar Casinos needs to rack up some debt to reduce its profile as a takeover candidate. Penn National is in a buying mood but, with its private-equity buyout threatening to unravel, it’s got hassles of its own.)

As for the cheese-paring moves that customers are reporting at Harrah’s Strip properties, Calistri warns that “cost cutting and efficiency will only help [Harrah’s] at the margins ... Indeed, Harrah's biggest hurdle toward profitability over the near term is likely to be undoing the debt associated with their acquisition.”

Galaxy Entertainment's Starworld project, Macao

Which is why when analysts float the idea of Harrah’s buying Galaxy Entertainment as a quick means of entry into Macao, I’m tempted to employ one of my Mom’s favorite retorts: “Using what for money?” Galaxy has its problems (like basically learning the casino business on the job) but with no new gaming concessions on the Macanese horizon, its value just shot up considerably.

And then there’s the little detail of a $2.8 billion (with a ‘B’) tribal court judgment against Harrah’s that, if it continues to stand up (much data here), will lumber the company with even more debt and interest. The verdict isn’t really Harrah’s fault: The case dates back to when Arthur Goldberg was alive and running Park Place Entertainment, which became Caesars Entertainment, which was bought by Harrah’s Entertainment, which is contemplating changing its name to … Caesars Entertainment.

It’s a good thing Apollo and TPG hung onto Loveman, just in case their casino acumen is on par with Apollo’s retail acuity. Earlier this month, Apollo vassal Linens ‘n Things filed for bankruptcy in what Bloomberg called “the biggest leveraged buyout failure since credit-market disruptions began last summer,” and what one analyst characterized as “an utter and complete disaster.” The company will close 20% of its stores, leaving 2,500 people unemployed.

Apollo’s exposure is only (“only”) $260 million, meaning that others, primarily General Electric, are holding most of the bag on this debacle. And maybe the timing wasn’t so good for taking real estate franchisor Realogy Corp. private for $8.5 billion, either. (Bloomberg says $6.6 billion.)

And don't forget about Harrah’s unraveling international strategy, which was ill-timed at best and possibly a total bust. But that’s a topic for another time ...

An Isle too far?

Wed, 16 Apr 2008 15:32:00 -0700

Whatever Isle of Capri Casinos thought would be accomplished by buying into overseas markets, it hasn't worked out, and new Morgan Joseph & Co. analyst Justin Sebastiano's advice amounts to "Yankee, come home."

Isle stock bottomed out around $6.50/share before rebounding. Isle's overseas investments are simply sucking money out of the balance sheet, at a time when the Iowa and Louisiana markets have flattened, and Florida isn't living up to expectations. (To say nothing of spring floodwaters that are probably going to swamp the next quarter's financials.) New CEO James Perry's main task appears to be the unenviable one of retrenchment -- and perhaps devising a way to breathe new life into a brand that hasn't aged well.

Somebody gives you a statue of Julius Caesar. Where do you put it? In the barn, apparently.

Score one for Mohegan Sun. It increased its slot handle in March and narrowed its year-over-year decline (-1.4%) in revenues. No such luck for Foxwoods Resort Casino, which was 12% off on both fronts. Did MGM Mirage back the right horse? We'll find out next month, when MGM Grand at Foxwoods opens.

Scant comfort for smokers. When Atlantic City players threaten to take their business to other states that let them light up on the casino floor, they may be ... blowing smoke. It's illegal in Delaware and at non-tribal casinos in New York, and it might be outlawed in Pennsylvania soon.

Whatever the Keystone State does, it's already a moot point in Philadelphia: No public puffing allowed there. Were I a betting man, I'd say the Lege will compromise go with a version of the 25/75 ratio that was tried in Atlantic City -- and, if that happens, that there will be a more urgent attempt at compliance this time around.

Atlantic City might be holding a stronger hand than we thought.

Case Bets: Herbst, Vegas' mystery tribal casino

Fri, 14 Mar 2008 12:52:00 -0700

With Herbst Gaming floundering, company President Ed Herbst has done the smart thing and stepped aside in favor of COO Ferenc Szony (Herbst stays on as CEO and board chairman, though). Szony, a personable executive with a history of staying afloat in a difficult market (Reno) is just what Herbst Gaming needs right now. He's also got a sizable dash of promotional flair, possibly inherited from his showbiz parents.

Whatever the reason, he's been able to keep the Sands Regency in downtown Reno going despite its being an a facility d'une certain age and out of the central casino corridor, to boot. Herbst is being hammered on a variety of fronts: two large buyouts in quick succession; a harsh winter in the Midwest that kept gamblers at home; stagnation in small casino markets; higher gas prices; truncated slot-route revenues (I almost never see players at the slots in my neighborhood Herbst affiliate anymore). At least one irate player isn't the least bit sorry about Herbst's current misfortune.

Another reason Herbst is struggling, I gather, is its difficulty integrating its Primm, Nev., operations (late of MGM Mirage) into its business model. It's not a locals market, nor even a drive-in market so much as a drive-through market, and Herbst is supposedly having a hard time making a go of an operation unlike any other in its portfolio. Also, when I visited there last Memorial Day, some of the facilities were in dire need of sprucing up, while the staff seemed slack and indifferent.

A change was in order and Herbst Gaming now has the right man on the job.

Phantom land deals on South Strip? Could this enigmatic purchase be in any way related (perhaps in stalking-horse fashion) to the Vegas tribal casino touted by Shoshone and Muckleshoot tribes but disdained by the Seminoles. The locations are roughly compatible: I-15 and Windmill Lane, although not quite identical, if you study this mystery video.

The film-ette employs a modified version of the old Ellis Gaming logo, although that company is now Epic Gaming and former prexy Shawn Ellis appears to be freelancing. And the notion of far, far, far out-of-state tribes getting federal permission to open a casino on the Vegas Strip is -- to put it charitably -- a stretch. Not impossible. Just highly unlikely.

Need casino furniture, cheap?

Thu, 13 Mar 2008 13:37:00 -0700

When I visited Detroit, the official position of MGM Grand Detroit was that its vacated temporary casino (formerly an IRS building) could be re-activated as a casino, if MGM so chose. I guess they chose otherwise. Yes, this roulette table could yours for a mere thousand clams. Come on down!

Bankruptcy in Bossier City. There's been a malaise in that Louisiana market ever since Class III gaming started to make inroads in Oklahoma, threatening Bossier City's key feeder markets, like Dallas-Fort Worth. Now an ex-Isle of Capri riverboat casino has hit a financial shoal.

Blackballed on the Strip? Or maybe you're just having a hard time breaking in? No matter. The Seminoles need a few good dealers (3,650, to be precise) and they're going at least as far as Atlantic City to find them, maybe even to Las Vegas, they say. (I mean, we've only got, what, six Columbia Sussex properties here? The Seminoles will have those 3,650 dealers in nothing flat.)

But if you're really hard up for comedians (and maybe too cheap to buy an ad), you can always put your phone number in a Las Vegas Review-Journal and risk being inundated by every bad standup comedian with an Internet connection, a mouse and a telephone. Heck, Fitzgerald's did. That's 702/388-2400 and ask for Gene Sagas. I'll be expecting S&G's usual 10% commission if you get the gig, OK?

Winter in New England

Wed, 12 Mar 2008 17:16:00 -0700

Although it enjoys consistently higher slot revenues than competitor Foxwoods, Connecticut's Mohegan Sun casino resort has been consistently down in terms of slot revenue. A five-month tracking period analyzed by the Boston Globe finds Mohegan Sun declining both in terms of actual dollars and year-over-year comparisons. By contrast, Foxwoods' slot revenues are more spasmodic, ahead of prior-year figures some months, behind in others. (Neither casino is required to report table game revenue to the state.)

Beyond Connecticut, the Twin River VLT facility in neighboring Rhode Island imposed an economy regimen after per-machine revenues fell 6% in the last quarter. Both UNR's William Eadington and the University of Connecticut's Arthur Wright say the New England market has either reached its saturation point or soon will. Not to mention that people are gambling less nationwide. (But if you say the word "recession" the terrorists have won.)

This grim data, however, does not deter Massachusetts Gov. Deval Patrick from plowing forward with a possibly foolhardy plan for three Bay State casinos. Why foolhardy? Well, Patrick's reliant on outdated revenue projections that -- in order to work -- would now require Massachusetts slots to outperform their Connecticut counterparts with fewer machines. And even a Las Vegas Sands consultant says Patrick's construction-jobs projection is way off the mark (by about 9,000 jobs).

On t'other hand, both Sands and Harrah's Entertainment seem willing to entertain a 27% taxation rate to get in on that Massachusetts action. That's worth keeping in mind if Sheldon Adelson or Gary Loveman start to inveigh against the disastrous impact of a 9.75% privilege tax rate in Nevada.

MGM Grand Detroit a smash. Okay, so I went there (for Northwest Airlines' in-flight magazine), loved what I saw and got treated like a king. So discount that.

But there's no discounting a 28% jolt to Detroit's casino economy, thanks to the swanky new place down the road from Tiger Stadium. It also took a small bite out of Motor City (whose upgrade still isn't fully online) and smoke-ridden Greektown.

MGM also saved a bundle ... not from switching its car insurance to Geico but by building a permanent casino-hotel, earning it a substantial tax break (Motor City can expect a similarly large 'thank you').

Greektown, meanwhile, is in a bind. To build a new casino it would have to move away from the very neighborhood -- with its lively restaurant row -- it was built to save. Then again, so long as it stays in its idiosyncratic, Stanley Ho-worthy "temporary," it can expect to keep losing market share. It's an unenviable dilemma.

Billie: Odd Man Out; Tilman Fertitta Gets Miffed

Tue, 11 Mar 2008 11:10:00 -0700

For one month at least, you've got a reason to read Playboy for the articles (well, three if you count Kurt Vonnegut's essay on the firebombing of Dresden and new fiction by Dog Soldiers author Robert Stone).

Controversial former Seminole chairman James Billie is the subject of a lengthy profile. He's plotting a return to the directorship of the tribe now that it's flush with Hard Rock and Class III gambling cash. Author Pat Jordan's story is a sentimentalized apologia for Billie, told almost exclusively by Billie and his sympathizers (NIGC Chairman Phil Hogen makes a cameo appearance).

To hear Jordan tell it, all that stands between the Seminoles and federal revocation of their sovereignty (Ha!) is someone like Billie, "who was preaching fiscal responsibility." Leaning on a recent series of Sun-Sentinel exposés, Jordan thunders that "There is a perception in Florida, outside the reservation, that the Seminoles have become greedy and arrogant, possibly corrupt ... [a] perception among non-Seminoles that tribal leaders have a serious image problem."

Not half as much as when James Billie was running the show. (Jordan also plays down Billie's ties to Meyer Lansky, failing to even properly identify Lansky for readers who don't speak cosa nostra.) Shame on Playboy for running such a poorly vetted piece and shame on Jordan for not getting the other side of the story (registration req'd, alas).

Tilman the Umbrageous: Owner of the Golden Nugget and a man easily slighted, Tilman Fertitta is venting in the Las Vegas Business Press (sorry, no link) ... again. Despite the efforts of Four Queens owner Terry Caudill and El Cortez patriarch Jackie Gaughan, Fertitta is insisting upon sole credit for Downtown's modest revenue growth in 2007, attributing it to a 10% upsurge at the Nugget. (Since Nevada doesn't provide property-by-property breakouts, there's no way to independently verify this claim.)

Granted, Fertitta is almost alone in attempting to improve Downtown's casino image and he's spared no expense in doing so. The bright and shiny Nugget (home to an overzealous security force, it seems) would be right at home on the Strip. Wouldn't couldn't say that of Don Barden's Fitz and never of the rag-tag assortment of Tamares Group properties.

Still, it seems a bit presumptuous for Fertitta to berate Business Press reporter Benjamin Spillman by huffing, "You're thinking downtown was up. It's not. The Nugget was up."

Whatever you say, Tilman. Just don't make us listen to that "Golden Nugget" theme song again, OK?

Moulin Rouge project puts cart before horse

Thu, 06 Mar 2008 17:00:00 -0700

A group hoping to revive the long-faded glories of the Moulin Rouge hasn't found construction financing. But no matter: They've signed a casino-management team; Epic Gaming, a company whose only other ongoing concern is a tribal casino in Oklahoma, with 550 slots. This is not a choice of operator that leaves one brimming with confidence.

Epic used to go by the handle of Ellis Gaming. Although founder Shawn Ellis is long gone, his team of heavy hitters is still in place. With the likes of former Caesars exec John Groom on board, theoretically Epic has the sort of braintrust that could reimagine the Moulin Rouge as someplace hip and sexy ... although its Bonanza Road neighborhood is anything but. Even someone who works there keeps drawing attention to its "vacant and burned buildings, repair shops, a United Parcel Service distribution center and a homeless shelter."

Epic recently pursued one of the casino licenses up for grabs in Kansas but its application was unceremoniously swatted away. As for the developers, they expect that a hoped-for rezoning (skedded for April 2) will lure construction money out of the woodwork. Under the newly unveiled arrangement, Epic will get to keep all the gambling revenue -- unless or until Moulin Rouge Development Corp. or Republic Urban Properties obtains a gaming license.

It's a business model that's quickly becoming, if not prevalent, very popular along the Strip (as at the Sahara) ... although you'd have to have an MGM Mirage-like revenue stream (60% non-gaming) to make it pencil out, and Harrah's Entertainment just reported softness in precisely that segment of its Vegas business.

Desperation in Florida

Wed, 05 Mar 2008 17:53:00 -0700

... and for once we're not talking about Sen. Clinton's attempts to seat a rogue slate of delegates.

Is Isle of Capri's racino a disappointment (especially for horsemen)? Is Boyd Gaming taking Florida expansion off the table? Is Magna Entertainment threatening to close overextended Gulfstream Park? What's a Florida lawmaker to do?

Why, legalize every form of gambling short of cricket fighting, of course. Statewide slots, a lottery, regulated "adult arcades," high-stakes poker -- it's all on the table as Sunshine State solons head back to Tallahassee, no doubt looking forward to two months of nonstop eye-poking and head-slapping between Gov. Charlie Crist (R) and archenemy House Speaker Marc Rubio (R), as they tussle over a shrinking state budget.

Rubio's still trying to rein in Crist's Class III compact with the Seminole tribes, but that horse may have long since left the stable. The Seminoles are proceeding as though they'd never heard of Marc Rubio. Should he get a court to overturn the compacts, Florida lawmakers who have had a taste of once-forbidden Seminole gambling lucre may already be hooked and repudiate Rubio (who's a lame duck, anyway).

As for the absence of cricket fighting from the list of proposed fiscal remedies, I'd guess that's just an oversight.

The Schmuck Report: On a humorous note, sports reporter Peter Schmuck takes a glance at the gleaming façades of Florida's racinos and declares that "the experiment with increased gambling in Florida appears to be a success." This is either disingenuous boosterism for bringing racinos to Maryland (an on-again, off-again quest) or else Schmuck is happily inhabiting a parallel universe.

Corzine opines. New Jersey's governor goes on the record as favoring smoke-free casinos. He also backs the Casino Reinvestment Development Authority in its quarrel with Atlantic City over whether or not to sell Bader Field to Penn National. (Turns out Penn wants additional land re-zoned for casinos, too.)

Financing is sufficiently concrete, Corzine says, for both Revel and MGM Grand Atlantic City, and he's bullish on Pinnacle Entertainment's postponed megaresort. And playing the stock market isn't gambling, he says: "We made probability judgments about the viability of assets."

Racinos a bum deal?

Mon, 25 Feb 2008 16:55:00 -0700

They are if you're a horse owner at The Isle Casino & Racing @ Pompano Park, which not only left trainers and owners out in the cold, as far as slot revenues are concerned, it just slashed purse amounts by 35%, reports the South Florida Sun-Sentinel.

Pompano Park, it should be noted, is an isolated case. The track, owned by Isle of Capri Casinos, argues in its own defense that slot revenues were lower than expected. But will racing be driven out in the process? Again we are faced with the question of how viable horse racing actually is (I'm looking at you, Kentucky) if massive subsidies from slot machines are what's needed to keep it alive. And while not contractually obligated to do more than it's done for the horsemen, at first blush it looks as though Isle of Capri has pulled a bait-and-switch here.

My 18-year-old son is in the news again. Oh wait, that's Florida House Speaker Marc Rubio, fighting a dogged rearguard action against Gov. Charlie Crist's gambling expansion in Florida. Rubio is arguing that A) Crist's revenue projections won't pencil out and B) "it is morally wrong to balance the budget on the backs of the poor and the working class."

It's a good day whenever a Grover Norquist-type conservative like Rubio comes out against regressive taxation. Unfortunately, Rubio's remedy is to dismantle the Florida state government. Also, he's made a habit of opposing fellow Republican Crist whenever possible (the two are vying for the mantle of Jeb Bush) and when Rubio says he's against "transferring" disposable income, it sounds to me like code for "By all means, let's keep it away from the Seminoles," whose Class III compacts Rubio is challenging in court.

So forgive me if I doubt Rubio's altruism just a bit. (And, no, I don't have an 18-year-old son.)

If he's lost Schwartz, he's lost Middle America. The lone media defender of Columbia Sussex CEO Bill Yung has left the building. UNLV's Dr. David Schwartz finally loses patience with the Kentucky hotel baron after reading about Yung bragging on his ability to fling $1 million at the feet of Kentucky's new governor in the same week that Columbia Sussex stiffed the state of New Jersey for 750 large. Is Yung's company really that hard up or is this a passive-aggressive way of getting back at the Garden State?

Excessive federal zeal in prosecuting gambling rings finds an unsympathetic ear at the Supreme Court. If there's a reason some Americans are distrustful of expanded federal law-enforcement powers, whatever the premise or the administration (the Clinton-Gore administration had its intrusive proclivities, too) it's because, inevitably, they will be pushed past the breaking point.

Foxwoods in Bahamas & other doings

Fri, 22 Feb 2008 15:31:00 -0700

The growing Foxwoods empire now reaches beyond U.S. borders, as the Mashantucket Pequots take on the management of the Royal Oasis resort in the Bahamas. Pequots rule!

John Voyles, a visiting professor at UNLV, specializing in game protection, has joined Globalysis Ltd., holding the rank of partner.

Phil Hogen, chairman of the National Indian Gaming Commission, suffered a mild stroke after a strenuous day that included skiing and wood chopping. He is also in the midst of taking testimony on proposed rules for Class II gambling, ones that have drawn resistance.

We wish Hogen a full recovery.

Carson City will have a new casino late next year. The project, GoldTown Hotel and Casino Resort, is owned, through a pair of holding companies, by local firm American Vantage Cos., minority owner of Border Grill, whose CEO is Ronald J. Tassinari.

Can't Copperfield make himself disappear?

Wed, 20 Feb 2008 18:28:00 -0700

Every so often, you get a press release that's too good of a target to pass up. Such was the case when Mohegan Sun e-mailed me its announcement of "An Intimate Evening of Grand Illusion" with David Copperfield. Now, if I were Copperfield or his handlers, right about now would be the last time the words "Intimate" and "Copperfield" should appear in the same sentence. Call it "ill-judged" at best.

In the press release, Copperfield also takes credit for the success of Criss Angel and David Blaine. Good. Now we know who to blame the next time one of those two shows up in the tabloids.

Penn Jillette said it best when he described Blaine's "magic" as "the kind of stuff Siegfried & Roy stopped doing when they were 12." As for Angel's freakiness, it hasn't kept him scoring with über-babes like Minnie Driver and Cameron Diaz, though both appear to have been sufficiently mindfreaked by now.

Oddly enough, I could find no copy of the press release, nor any advertisement on his "intimate" evening on the Mohegan Sun Web site, at least for now.

Where there's smoke ...

Wed, 13 Feb 2008 19:53:00 -0700

... there may be a whole lotta litigation, now that Judge Cosmo Giovinazzi ruled in favor of a baccarat dealer -- and against the erstwhile Claridge Casino Hotel -- in a lawsuit concerning the impact of second-hand smoke. Former dealer Kam Wong lost her entire left lung in a pair of surgeries and hasn't worked in eight years.

The judge agreed with Wong's attorney's contention that a decade of exposure to players' and colleagues' cigarette smoke had a causative effect. "Wong testified ... that six out of 10 people smoked in front of her and would exhale their smoke right in her face," writes The Press of Atlantic City.

Current Claridge owner Harrah's Entertainment was keeping its counsel as of press time, while a fellow defendant was mulling appeal. If Wong's claim holds up, look for it to be the thin wedge of more and more litigation on this issue. It could also provide additional ammo for those who argue that casinos have to carve out enclaves for non-smokers ... something other than putting ashtrays on one side of a narrow aisle and "No Smoking" signs on the other. (And I'm not making that example up, either.)

Steve Wynn tells it like it is and investors scatter in panic. Guys, if you're just in it for the short haul and sunshine every day, don't invest in Las Vegas, OK? Especially not in the era of the multi-billion-dollar megaresort. It's not for the fainthearted.

You have my sympathy, Steve. (So much so that S&G is inaugurating a "Steve Wynn" subject tag for the occasion.)

There's no doubt that a McCain administration would, from a tribal-issues standpoint, be a vast improvement on the current one, represented below by its two primary architects, here united through the apparent magic of Photoshop:

(OK, that's a relative compliment to McCain, but we didn't mean it that way). But one tribal advocate begs to differ and he's not mincing words.

Adelson: Stanley Ho's days are numbered

Wed, 06 Feb 2008 18:53:00 -0700

Toward the bottom of an otherwise run-of-the-mill report on Las Vegas Sands' year-end numbers, Sands supremo Sheldon Adelson lets fly with a bombshell: Not only will there be no new casino concessions in 2009, when Macao Chief Executive Edmund Ho leaves office, there will be fewer. (Bad news for Harrah's, this. They're really banking on a new round of concessions and, perhaps, subconcessions too.)

"Some of the bottom, the older, individual non-known (Stanley Ho-run operations) ... like Golden Dragon and Greek Mythology" and others could have their casinos closed, Adelson predicts. However ... it turns out that Adelson is merely "hoping" that this scenario will come to pass, basing it primarily on a "feeling" he gets with talking to Macao's Communist overlords in Peking.

"(T)hey indicate to us that they feel that there have been too many licenses out there," quoth Adelson. Of course, there's still a big difference between feeling there's too much of X on the market and actually constricting the supply of X. So we'll have to wait and see.

Bush sticks it to tribes once more: The most anti-tribal administration in recent U.S. history is at it again. Presumably to help pay for his quixotic war in Iraq, Shrub proposes to slash the Bureau of Indian Affairs budget by $100 million. Monies earmarked for fighting meth, increasing student achievement and economic development (the latter up 35%) will be increased.

And what are the 'frills' that have been targeted for the meat cleaver? Oh, how about school building, public assistance, scholarships, road maintenance, adult education, tribal courts, Johnson O'Malley education grants, land consolidation and housing improvement? (The last three would be zeroed out completely.)

As far as tribes are concerned, a John McCain administration probably can't come soon enough. They're one group of Americans who will undoubtedly be heartily relieved to see the last of this current administration and its contemptuous disregard for those at the very bottom of the economic ladder.

Monte Carlo: the catastrophe that wasn't

Tue, 29 Jan 2008 15:21:00 -0700

Although everything worked out about as best as could be hoped during the Monte Carlo fire, I'm not sure whether to be reassured or disturbed to learn that it could have been a lot worse, up to and including the locking of evacuation doors. Given the corner-cutting found recently at The Rio, Harrah's Las Vegas and the Flamingo, there's been altogether too much laxity and penny-pinching of late where fire-safety issues are concerned.

Hopefully, the silver lining in the Monte Carlo smoke clouds will be a more urgent discussion (accompanied by action) to nip this problem in the bud. After all, if these problems are cropping up at second-tier Strip properties, I shudder to think how much more serious they might be at some of the real dowagers in town, particularly those that have been afflicted with cash-flow issues in recent years.

As for whistleblower Stroud "Stan" Maldare, instead of imposing a gag order on him, MGM Mirage management ought to be promoting him to an oversight position, as he obviously is more on the ball than some of his higher-ups. We should all have employees who care so passionately about their workplace. If there's a hero in this saga, Maldare seems to be it.

As for Super Bowl Weekend guests booked into the Monte Carlo, I'm told MGM Mirage is taking it a day at a time and will accommodate them at other MGM properties. Good thing they've still got Circus Circus.

Oh, shoot: Now it's happened at Foxwoods. Not a good week for MGM Mirage (Foxwoods' business partner).

Pinnacle comes to Baton Rouge ... or not. Voters will decide the issue on Feb. 9; in the meantime, there's a grass-roots movement to block Pinnacle Entertainment's proposed riverboat-casino project near Baton Rouge, which would gobble up a chunk of rural flood plain. The pros and cons are laid out, along with some comparisons between the proposed Pinnacle boat and the extant Penn National and Columbia Sussex vessels.

Since Pinnacle is not shy about investing in its properties (a spirit that evidently doesn't extend to its prospective competitors; see below), one would think that the Baton Rouge community would be on board with the project, but apparently not. What's more, Penn National would probably put off or scrap a plan to send Argosy Lawrenceburg to Baton Rouge, while Columbia Sussex has other problems with which to cope right now.

Also, a Penn National-commissioned study predicts that Pinnacle's advent would be the pits for Penn and Columbia Sussex, with one or both boats forced out of the market. If Penn postpones upgrading its casino because of impending competition that'll be what we call a self-fulfilling prophecy. Live by the free market, die by the free market.

(Not that I put much stock in Penn's worst-case-scenario prediction.)

My sympathies are somewhat with the NIMBYs: Build it ... but in a different site, if possible. As for Penn and C.S., what they're asking for smacks of protectionism and should be backhanded by the voters. Did Steve Wynn's megaresorts push older, mustier casinos out of business? Probably. But that's how markets evolve.

$81 million

Tue, 15 Jan 2008 18:16:00 -0700

That's the magic number that Kansas Gov. Kathleen Sebelius foresees from casino licenses and racinos. Note, however, that the enabling legislation is still being vetted by the courts. Nevada officials, besieged by less-than-expected gambling revenues and a gubernatorial demand for at least 4.5% budget cuts, can only gaze in despair at Kansas' $935 million rainy-day fund, the biggest in the U.S.

Sticking with states that begin with 'K,' Las Vegas Sands COO William Weidner is singing a siren song to Kentucky legislators. Although his revenue projections look just a mite rosy, Weidner needs to make a strong case, as he (and Gov. Steve Beshear) will have to win over a supermajority in both houses of the Kentucky Lege, not to mention a majority of Bluegrass State voters. Riverboat owners in the southern Illinois and Indiana markets must be watching this with apprehension.

Oh, that recession: But don't worry; Deutsche Bank reports that casinos -- and the slot business in particular -- are especially recession-resistant. That, and casinos are everybody's favorite quick-fix when the economy goes south.

Go figure. Both Mohegan Sun and Foxwoods Resort Casino had pretty bad months at the slots (neither casino reports table game revenues). In the case of Foxwoods, it's particularly baffling, in light of greatly increased coin-in from players -- $123 million more. The Day implies a cause-and-effect relationship between the revenue plunge at Foxwoods and the abrupt resignation of its president, John O'Brien.

Boy, is my face red. No sooner had I deemed the Culinary Union's belated endorsement of Sen. Barack Obama a quasi-irrelevance than the Nevada teachers' union made it very relevant by getting het up and trying to shutter the "at large" caucuses being held on the Strip. (This story has been all over "the Internets," so I'll spare you any links.)

While this solicitude for the (D)emocratic process is touching, its timing is suspect. And it enabled the Culinary's D. Taylor to claim, in a neat bit of rhetorical jujitsu on MSNBC's Hardball, that his adversaries were trying to hold down minority voting on the eve of Martin Luther King Day. So now the Culinary is looking very relevant indeed.

Mixed results for the second night of The Sarah Connor Chronicles. Because, frankly, there's nothing more important. Well, maybe a war or two, the economy, education, terrorism and global warming, etc. But other than that, nothing.

Quote of the day

Mon, 14 Jan 2008 18:24:00 -0700

"Keeping the Indians down and restricted to the reservation is part of a paternalistic attitude some find hard to shake." -- St. Regis Mohawk Tribal Chief Lorraine M. White