New York: Turning the page; Cal-Neva is on the clock

‘Wait three years’ is the new rationale coming out of Albany, now that three new casinos in upstate New York have failed to meet Year One revenue projections. Taking the glass-half-full perspective, state Sen. John Bonacic says that the casinos were the will of the people, adding, “Let’s say, for the sake of discussion, they don’t meet the projections that they expected. I still think they’ve created private sector jobs. They will have been a magnet for other economic vitality coming into the area – businesses that feed off the resort, that service the resort. And I do believe it’s going to help the tourism industry.” Bonacic himself is moving on, looking toward the passage of Internet gambling as the next revenue fix.”And the other thing, and not in the same glitz, is charitable gaming, to allow American Legions and Veterans of Foreign Wars posts to do charitable gaming so they can enhance their revenue. Over half of them have closed,” he adds.

Of the Catskills region, Bonacic says, “it’s a low median income – there’s a lot of poverty, illiteracy. They needed it the most, so I’m hoping that [Resorts World Catskills] will be a catalyst for other economic vitality … the purpose of the three casinos that exist now, we’re accomplishing what we set out to do. These are areas that needed this the most. With the jobs and trying to give a shot in the arm for some economic vitality. So Schenectady, Tioga, Tyre, they all needed it up there and down there.”

Bonacic’s opposite number in the House (they chair their respective Racing & Wagering Committees), Gary Pretlow, has been more critical of the overhyped revenue projections made by the new upstate operators. “I’m of the suspicion that they boosted those revenues and offered more than they should have offered based on the real numbers just to get the license. And then within a year they want to turn around and say now lower the tax rate – more like a bait and switch,” Pretlow says, “They have not asked yet for a tax reduction. But I’m just assuming that that’s the next step. And they’re going to threaten us with loss of jobs and yadda, yadda, yadda.”

Pretlow pins the underperformance of the casinos to seemingly esoteric factors as the number of hands dealt per hour, based on an inspection of Rivers Casino. Still he is relatively sanguine, opining that “New York is in the forefront of casinos. I’m looking from the state’s point of view and not from the casino operators’ point of view. Before we had the commercial casinos open, New York’s general income from the racinos surpassed Nevada’s. And Nevada has dozens and dozens of casinos, but New York was taking in more money in the state than all those casinos combined.” He concludes by saying that it’s on Genting Group‘s head to make the most of its five-year window of opportunity with Resorts World Catskills (in other words, get open as soon as you can) and that the state could and should squeeze bit more money from DFS. In short, upstate casinos are yesterday’s news to the two chairmen and they’re on to finding new cash cows to milk.

* Tech mogul Larry Ellison‘s off-again, on-again courtship of the Cal-Neva is back in “on” mode. The deal would see Ellison buy the Cal-Neva out of bankruptcy for $36 million. Mind you, the offer is only good through Jan. 10, so let’s cross our fingers and how Ellison gets his wish sooner rather than later.

* Gambling revenues at Penn National Gaming‘s Plainridge Park rose 5.5% last month, with an astonishing $344/slot/day in win. That number is almost certain to take a hit when Wynn Boston Harbor opens so, for Penn, it’s a case of gather ye rosebuds while yet ye may.

* Speaking of gathering rosebuds, Wakayama‘s chances of winning a Japan casino improved when the governor of the prefecture reversed his foreigners-only stance on casino admissions. Yoshinobu Nisaka‘s change of heart is conditioned on the imposition of problem-gambling regulations that are “effective and accepted by Japanese citizens.” Let’s face it, at the budgets under discussion, any casino resort that caters only to gaijin is a losing proposition, one reason that Wakayama could easily have lost out had Nisaka not changed his mind, or at least taken a more nuanced stance on the issue.

* Not waiting for the Supreme Court to rule on sports betting, the Michigan House of Representatives‘ Regulatory Reform Committee has advanced a bill that would allow Internet gambling that includes sports wagering. Said sponsor Rep. Brandt Iden (R). “That language is in there to start the next round of conversations. I don’t want us to get ahead of ourselves, but we know that is coming – the repeal of [the Bradley Act] is likely coming in the spring – and we want to put Michigan in position to put our best foot forward as it related to sports gaming.”

The bill faces almost-certain opposition from Michigan tribes, who aren’t down with ‘Net-betting. By contrast, “the commercial industry has been good. They’re played a pretty active role in the process. They seem to be satisfied with this stage of the game,” says Senate Majority Leader Mike Kowall (R). There’s still the possibility that the language would have to be ratified by the electorate but, so far, it looks like that won’t be needed.