Suicidal in New Jersey

Atlantic City can just plain go to hell. That’s the message from several prominent — or simply loud — Democratic lawmakers who say Gov. Chris Christie‘s rescue plan for the city is spinach and to heck with it. Noisiest of the bunch is sports-betting fixated state Sen. Raymond Lesniak. Challenging the federal sports-wagering ban isn’t tilting at windmills, in our opinion, though Christie will have none of it.

It’s downright brilliant compared to Lesniak’s newest brainwave: a casino megaresort at Meadowlands, to be built by that most successful of gaming operators, Donald Trump. (To his credit, Trump isn’t having any of that either.) Lesniak makes the empty promise of donating $600 million in casino profits in Year One to Atlantic City and $100 million each year thereafter.

Earth to Lesniak: Unless you build that casino in Singapore, you’re not going to make a $600 million profit this year, next year or any year. Even $100 million on the casino-crowded Eastern Seaboard looks like quite a stretch. Fellow Sen. Paul Sarlo (D) is on board with the general concept but doesn’t appear to share Lesniak’s pie-in-the-sky visions. But even Sarlo’s more limited concept runs headlong into the reality that Genting Malaysia is in the fast lane to build a $350 million slot house and $650 million more in amenities at Resorts World New York, er, Aqueduct Racetrack. Think of it as a Gotham casino with race horses in lieu of showgirls. (The American Gaming Association‘s “Smart [sic] Brief” tastelessly refers to the Malaysian company’s project as a “gambling mecca.” Xenophobic much?)

Speaking of Meadowlands, the Hanson Commission‘s proposed public bailout of Colony Capital‘s Xanadu (above) came with a list of conditions as long as your arm. A good thing, too: Xanadu just got repossessed and (according to the Wall Street Journal), “some industry experts say the development was ill-conceived from the beginning.” That’d make it a prototypical Colony investment play. Having lost patience with Colony CEO Tom Barrack, lenders are now shopping the project around to other developers — it would appear to be right up the alley of Mall of America creator Triple Five (currently lumbered with some bad Las Vegas investments of its own) — while Christie’s office takes a position of strict neutrality as the mess gets sorted.

Harrah’s Entertainment is taking its lumps, as New Jersey solons understandably look askance at CEO Gary Loveman‘s dickering for a share of the ex-Foxwoods casino project in Philadelphia. It’s a bit of a poser from a business standpoint, too, as it threatens to cannibalize revenues not only from Harrah’s four Atlantic City casinos — which own the preponderance of market share — but Harrah’s Chester, too. Whoever adopts this orphaned casino-to-be might steal some of that action anyway, so Harrah’s presumably thinks it better to gnaw off its own femur than let someone else do it. Which (sort of) makes sense.

For those Garden State politicos moping over the slow demise of the horseracing biz, consider this: Five-sixths of the purses at Penn National Gaming‘s Charles Town Race Track come right out of slot revenues. Add the money generated by the smash-hit addition of table games and race-derived revenue dwindles toward chump change. The sport of kings isn’t an “industry” anymore, just an aesthetically pleasing but expensive amenity.

Further up the coast, slot revenues at Mohegan Sun were up 2% last month and Foxwoods‘ rose 1%. This may be an anomaly due to what Wall Street calls “favorable comps” (in this case, one additional Sunday in July 2010). But let’s enjoy the moment, shall we?