Massachusetts gaming a success; Cuomo gains upper hand in NY

A University of Massachusetts Amherst panel led by respected academic Rachel Volberg has been studying casino gambling in Massachusetts and likes most of what it finds. It concluded that Bay State dollars had been significantly repatriated from neighboring states (the primary goal of legalization) and there was “no negative impact” on the state lottery. Citizens were fleeing the state in smaller numbers, going from 33% of cross-border business in 2013-4 to 16% in 2019. Bay Staters who were gamblers went up by 14% in the same period. 70% of study participants identified themselves as regular gamblers, while 3.5% admitted to being problem gamblers, with another 12.5% identified as at-risk. A fifth of them devolved into problem gambling while most pulled back into recreational gambling. Heavy ad blitzes “precipitated relapse. We can’t prove that but it’s very tantalizing,” said investigator Robert Williams. He added that “there is no ‘silver bullet’ to prevent problem gambling. Rather, a wide array of educational and policy initiatives is needed to address the multifaceted biopsychosocial” causes.

Low-income men were the likeliest to develop disordered-gambling habits, with substance abuse and mental ill-health cited as co-presenting morbidities. “Each problem gambler has a unique array of risk factors,” Williams said. “You need to tackle problem gambling from a multidirectional way as well.” Paradoxically, 9% of self-identified problem gamblers denied anything was wrong. The UMass teams recommendations include a cap on casino advertising, more education on problem gambling and active encouragement of disordered gamblers to seek treatment. Concluded Massachusetts Gaming Commission Chairwoman Cathy Judd-Stein, “There has been no other longitudinal study of gambling behavior of this scale in the United States. It shapes our understanding of gambling behavior in Massachusetts and contributes to the few comparable studies worldwide.” Agreed. Let’s hope it’s the start of a trend. Your turn, Nevada.

Elsewhere in Massachusetts, Wynn Resorts CEO Matt Maddox has some soul-searching to do about his company’s commitment to diversity. Encore Boston Harbor is being sued by a former front-desk clerk who alleges that she lost her job due to her pregnancy. Apparently Encore management was so petty it wouldn’t even let her wear flats. Plaintiff Ana Garcia-Risk‘s other allegations include requesting a different shift after having her schedule discomfited by fatigue and morning sickness. Instead she got “points” (and not in a good way) for schedule disruptions and a written warning. Garcia-Risk was moved to a day shift eventually but “appropriate breaks” to accommodate pregnancy-related issues like nausea were not forthcoming. She was suspended two weeks into December 2019 and sacked the following February. So far, Wynn Resorts is hiding under a rock from the litigation. Time for the company to join the 21st century. We recommend a “george” settlement with Garcia-Risk.

Online sports betting is losing momentum in New York State, with power swinging back from the Lege to serial-groping Gov. Andrew Cuomo (D). In a sausage-making development, legislation is expected to be some misshapen hybrid of Cuomo’s one-licensee approach and the Lege’s 14-skin/12% tax-rate consensus. “Our sense from news reports and industry contacts is that both sides may land in a scenario where there still is a competitive bid (like Cuomo wanted, and presumably a high’ish tax rate), but there also is a minimum number of licenses. For example, 4 licenses/skins and a 40% tax rate,” writes Credit Suisse analyst Ben Chaiken. Considering that the Empire State’s Democratic Party is so feckless it can neither pressure Cuomo from office nor muster the willpower to impeach him, getting rolled by the guv on sports betting hardly comes as a surprise. Chaiken also warns that tribes could get screwed: “If a scenario played out where the tribes don’t get a license, it would seem reasonable to us to limit mobile betting within a certain distance from the physical properties.”

Incidentally, DraftKings pays 51% in taxes in New Hampshire (where it enjoys a monopoly) and 40% in Pennsylvania (where it does not), so 40% would almost feel merciful. The state budget was due today but haggling over sports betting is likely to go into overtime, meaning we won’t know the outcome—if any—until next week. Chaiken thinks the accelerated three Five Boroughs casinos would be grandfathered into the legislation. As for OSBs, DraftKings already has a presence in the Empire State, as do Barstool Sports, FanDuel, BetRivers and Bet365. That’s five OSB providers jockeying for a maximum of four licenses. Our condolences to the odd man out. Elsewhere in the sports-betting universe, niche sports are here to stay, even if major leagues are getting back to normal. It’s just good business.

On the health front, one casino chain has gone smoke-free. It’s a tribal one, was Native Americans continue to represent the forefront of gaming. The Navajo Nation has announced that its casinos will reopen as non-smoking properties. “We’ve been at this since 2008 and there have been so many people that supported this effort throughout the years, from traditional healers to elected leaders,” said Patricia Nez Henderson, vice president of the Black Hills Center for American Indian Health, adding, “Their heart is in the right place when it comes to health.” According to Navajo Nation Gaming Enterprise CEO Brian Parrish, the inciting incident was Coronavirus and a further concern was protection of employees from secondhand smoke (although smokeless tobacco is also banned now). Native Americans, per to the CDC, have the highest incidence of cigarette smoking, so this cannot have been an easy sell for Parrish. We applaud the Navajos’ courage. Meanwhile, in Big Gaming, tar and nicotine continue to be king. According to Fodor’s Travel, “each casino adheres to its own version of health and safety protocols.” You visit casinos at your own risk. (Circa is named as a prime offender.)

Speaking of Circa, Derek Stevens is back in the news but in a good way this time. The casino has inked a pact with the San Diego Padres to be an official sponsor in the 2021 season. What this means in concrete terms is not clear but any signage at Petco Park will inevitably show up on Padres telecasts, invaluable exposure to be sure. Also, expect high Friars visibility at Stadium Swim and on Circa’s mega-screen in its sports book (actually 19 screens in one). “The Padres are one of the most exciting teams in baseball right now,” lauded Stevens and team Senior Vice President Sergio DelPrado returned the compliment: “We are excited to expand our brand to the Las Vegas market and work with such a cutting-edge and innovative property.”

DraftKings also expanded its presence by acquiring multimedia Vegas Sports Information Network, a provider of sports-betting news and analysis. Of course, now it will be a platform for DraftKings and an effective means of making new customers. “For example, we imagine there will be scenarios where spend that would have traditionally gone through paid TV or radio, may now be allocated essentially for free through VSiN,” writes Credit Suisse’s Chaiken, noting that DraftKings has essentially done the same thing Penn National Gaming accomplished when it bought podcast potentate Barstool. He continues, “most sports books generally offer the same mechanics (e.g., placing a bet), however, integrating VSiN content/analysis could make the DKNG product a richer experience for consumers, leading to increased betting volumes.” We don’t doubt it.

Jottings: American Gaming Association President Bill Miller is surrounding himself with strong women. Senior directors Cait DeBuin (Strategic Communications), Jessica Feil (Governmental Relations) and Meredith Pallante (Global Events) have all been promoted to vice presidencies. Our congratulations to them … Gambling win in Macao was up 58% from March 2020 but still 69% down from 2019. It was the highest post-pandemic level and “likely understates the degree of recovery,” according to JP Morgan analyst Joseph Greff. Casino patrons no longer have to be tested for Covid-19 to gain admittance. The next challenge comes in May, with Golden Week looming ahead … Should Las Vegas casinos require vaccine passports from customers? We say a vociferous “Yes” … Political Theatre of the Absurd: Civil-rights groups are calling for The Masters to be pulled from Augusta. However, The Masters is run by the city (which is somewhat unlikely to commit economic suicide), not the PGA. One might as well command the sun to rise in the west … Philadelphia Live is loosening up on the comps, it appears. It’s giving away branded umbrellas to patrons, instead of making them earn them with slot points. Bravo!