CasinoCityTimes.com

Gurus
News
Newsletter
Author Home Author Archives Author Books Send to a Friend Search Articles Subscribe
Stay informed with the
NEW Casino City Times newsletter!
Newsletter Signup
Stay informed with the
NEW Casino City Times newsletter!
Recent Articles
Best of Ken Adams

Gaming Guru

author's picture
 

Quick-takes: The month's trends in a glance - December 2007

1 January 2008

Voters went to the polls in November. They elected governors, senators and made some choices on referendums – some of which related to gaming. Probably the biggest news for gaming was the race for governor of Kentucky. Both sides had made gaming a key issue in the state; the winner, Steve Beshear, campaigned on a pro-gaming platform. He promised in rhetoric reminiscent of Ed Rendell in Pennsylvania to improve the state's economy and help state government with a few well-placed casinos. It will take more than one election to bring casinos to Kentucky, however. First there will be the kind of endless debate that is characteristic of not just Pennsylvania, but California, Maryland, Massachusetts and Florida. It will probably also take a public referendum. But the first step has been taken.

Steve Beshear lost in the 1987 Democratic gubernatorial primary, then failed again in a 1996 run for the U.S. Senate…Beshear had climbed the political ladder in the 1970s and 1980s as a state legislator, attorney general and lieutenant governor. He seemed to hit a political ceiling with his loss in 1987 to Democratic rival Wallace Wilkinson, who won the governorship on his promise to create a state lottery. Twenty years later, Beshear was out front on another gambling issue. Beshear, the son of a small-town preacher, supports legalizing casinos in the state. He says that putting about 10 casinos at horse tracks and a handful of towns along Kentucky's border would raise about $500 million in extra revenue that could go for such priorities as education and health care. (Bruce Schreiner, Associated Press, 11-6-07)

In Rhode Island, Massachusetts, Maine and Mississippi there were referendums on gaming. The referendums in Rhode Island and Massachusetts were non-binding and produced opposite results. The voters in one community in Rhode Island rejected the idea of expanded hours for slot machines at the local race track. The voters in Massachusetts want gaming, and the voters in Mississippi seem to think they already have enough or at least they don't want an Indian casino. In Maine the issue was also an Indian casino, and they too don't want one or any more gaming if one believes the editorials.

Residents of Lincoln sent a message to lawmakers: Don't expand gambling hours at Twin River in a bid to generate badly needed revenue for the state. Lincoln residents also voted against any shift to a full-scale casino. They voted Saturday on nonbinding ballot questions, so the votes count only symbolically, but that's OK with Town Council President Jeremiah O'Grady…Lawmakers considered a shift to 24-hour gambling at the end of the legislative session. Sen. Paul Moura, D-East Providence, has vowed to continue seeking expanded hours, saying on weekends and holidays alone they would generate $25 million in new state revenue. (Associated Press, New London Day, 11-12-07)

Voters in three Massachusetts cities approved nonbinding referendums supporting casino gambling on Tuesday. The ballot question in Pittsfield, which asked if voters support legalized casino gambling in the state, was approved 59 percent to 41 percent. The vote was tighter in Chicopee and Worcester, where residents were asked if they would support casinos in their communities. Fifty-two percent of Worcester voters said `yes,' with 48 percent voting `no.' In Chicopee the vote was 51 percent in favor and 49 percent opposed. (Boston Channel, 11-6-07)

Jackson County residents have cast their ballots against a proposed Choctaw casino. More than 18,000 voters, or about 60 percent, cast no votes in the nonbinding referendum. About 12,000 voters supported the plan to put the $375 million project at the intersection of Interstate 10 and Mississippi 57. (Associated Press, Biloxi Sun Herald, 11-6-07)

Maine voters on Tuesday rejected the Passamaquoddy Tribe's bid to build a racino in Washington County and offer high-stakes bingo there…With 83 percent of Maine's 624 precincts reporting, the "no" camp retained the lead that it had developed as soon as early returns began trickling in, with 52 percent opposing the racino and 48 percent supporting it. (Paul Carrier, Portland Press Herald, 11-6-07)

And in one more vote on Indian gaming, a newly elected, anti-gaming mayor, led the city council in Woodland City, Washington in adopting an ordinance rejecting an Indian casino near its city limits. It is also non-binding, but it is a clear message to the federal government of their opposition to the casino.

Opponents of the Cowlitz casino picked up another ally Monday when the Woodland City Council voted 3-2 to oppose the $510 million complex. Woodland joins two other cities, Vancouver and La Center, in telling the federal government that it doesn't want a massive casino complex built near its borders. (Jeffrey Mize, Columbian, 11-6-07)

Atlantic City is still experiencing declining revenues (so is Connecticut) caused, it would seem, by the slot machines in Pennsylvania. But that isn't Atlantic City's only issue as it looks toward 2008. There is good news. In the next couple of years, several billion dollars' worth of new hotels and casinos are supposed to open. In addition, there is hope a new operator will replace Trump and put some much needed capital into those properties. But on the other side of the ledger is the non-smoking legislation, the battles between the unions and the casinos as the dealers continue to organize, and the struggling Tropicana. The Tropicana is going through hearings for renewing its gaming license. Unions, the city council and state politicians are lining up to oppose the license. They all claim the property is mismanaged, understaffed and a danger to customers, employees and the integrity of gaming.

Warning of catastrophic health dangers in the gaming industry, anti-smoking advocates, led by New Jersey Health Commissioner Fred Jacobs, called Friday for a complete smoking ban at Atlantic City's 11 casinos. (Press of Atlantic City, 11-17-07)

Tropicana Casino and Resort is facing accusations of age discrimination from at least 22 employees it terminated during mass layoffs that occurred under a new owner this year…They are all alleging age discrimination, but in some cases filed additional charges of race, gender or disability discrimination. (Maya Rao, Press of Atlantic City, 11-6-07)

The city's largest casino union has filed papers with state gaming regulators seeking permission to intervene in a hearing for the operating license renewal of Tropicana Casino and Resort's new owner. (Maya Rao, Press of Atlantic City 11-8-07)

Tropicana Casino and Resort lost its bid Thursday to have potentially damaging information stricken from a state investigative report on its application for a new license. The New Jersey Division of Gaming Enforcement report delves into the casino's massive layoffs under new owner Columbia Sussex Corp…Among key points, it will examine the impact of Tropicana's approximately 1,000 job cuts - about a quarter of the work force - since Columbia Sussex acquired ownership of the Boardwalk casino in January. (Donald Wittkowski, Press of Atlantic City 11-16-07)

City Council is expected to formally ask the Casino Control Commission to deny a license renewal for Tropicana Casino and Resort at council's meeting…said cutbacks have been hurting resort visitors' experience. "The place is terrible - dirty, filthy," said Mason, in whose ward the casino sits. "I understand they can't make the rooms up in time. They're having all kinds of problems because they cut the staff and they're required to have a certain amount of staff." He said he believes the casino was as much as 37 or 38 percent understaffed in crucial areas. (Derek Harper, Press of Atlantic City, 11-13-07)

It may not seem like much of an issue, but that same argument may be leveled against any new operator in the future. It won't be possible to operate successfully in the more competitive environment of the future with the same payroll expenses that existed in the glory days of the 1980s and 90s. Operators will have to have the ability to reduce their costs as revenues decline.

The revenues will continue to decline, not for everyone, not every month and not forever. But with thousands more slot machines on their way to Pennsylvania and eventually to Maryland, Massachusetts and Kentucky, it won't be easy to make money in Atlantic City. Besides the competition outside the market, the bar is also going to rise in Atlantic City. The unions are mounting the same attack in Las Vegas on the Tropicana as they have done in the past against Stations. This additional battle is one Atlantic City doesn't need, and one it can ill afford.

The 11 casinos here reported a 2 percent decrease in gross operating profits in the third quarter of 2007…Gross operating profits totaled $416.2 million for the three-month period compared to $424.6 million for the same period last year. Net revenues fell by 3.8 percent for the period to $1.35 billion. (Press of Atlantic City, 11-19-07)

Revel Entertainment Group has secured a key environmental permit for its proposed $2 billion megacasino on a 20-acre oceanfront site, the company said Monday. (Press of Atlantic City, 11-19-07)

Las Vegas is in the news as it always is, but Las Vegas is a different place than Atlantic City. The stories this month have been more amusing than threatening. O. J. Simpson is back on center stage, this time in Vegas. While staying at the Palms, he allegedly attacked someone in Palace Station. Every time he has to appear in court, hundreds of reporters are on hand, and Las Vegas is on the evening news. But Las Vegas is also on the evening news for imploding the new Frontier, for a presidential political debate, and for the annual gaming show – not so much for what was on display but for what people said. Especially newsworthy was the discussion over internet gaming, where Gary Loveman of Harrah's implied it was on its way regardless of what Congress thought. The story was picked up all over the country and respun according to each reporter's political biases. That is really the Vegas story; it is always in the news, there is always something exciting and slightly titillating going on, and it never stays in Vegas.

Atlantic City casinos took in $384.4 million in October, a 7.5 percent decline from the October 2006. (Associated Press, 11-10-07)

Colorado's casino revenue was $65.9 million for October, a 1.67 percent jump from 2006. (Denver Post, 11-20-07)

Detroit October casino revenues rose 14.9% to $118.2 million. (Detroit Free Press, 11-19-07)

Connecticut, Foxwoods Resort Casino handled $727.8 million through the 7,271 slot machines, 9.9 percent less than in October 2006. At Mohegan Sun, the 6,183 slot machines handled $821.5 million, or 7.3 percent less 2006. (Erica Jacobson, Norwich Bulletin, 11-15-07)

Illinois October gaming revenue rose 5.3% to $164 million. (Gaming Industry Weekly Report, 8-12-07)

Indiana October gaming revenue fell 6.8% to $196.5 million while same store revenue was down 10.6%. (Gaming Industry Weekly Report, 11-19-07)

Iowa October gaming revenue rose 9.7% to $116.9 million while same store revenue was up 3.5%. (Gaming Industry Weekly Report, 11-19-07)

Louisiana's casinos won $196.7 million in October. (Associated Press, 11-13-07)

Mississippi October gaming revenues fell 1.5% to $218 million. (Biloxi Sun Herald, 11-19-07)

Missouri's casinos reported a 5.9 percent drop in attendance; revenues slipped 0.3 to $126.2 million percent compared to October 2006. (St. Louis Post-Dispatch, 11-13-07)

Nevada's September casino win was $1.06 billion, up 7.5%. (RG-J, 11-10-07)

Ken Adams

Ken Adams is the principal in the gaming consulting firm, Ken Adams and Associates. Formed in 1990, Ken Adams and Associates specializes in information, analysis, and strategic planning for Indian tribes, casino operations and gaming manufacturers.

Ken spent over 20 years in the hotel-casino industry, prior to founding Ken Adams and Associates. He held the positions of: Director of Casino Operations, Casino Manager, and Keno Department Manager. During this time, he developed numerous innovative marketing and customer development programs and systems for evaluating casino performance. Some of those programs, such as slot clubs and tournaments, have become industry standards.

Ken is also actively involved in gathering and disseminating information that is important to the gaming industry. He is editor and publisher of and the Adams' Report, a monthly newsletter specializing in identifying trends in casino gaming, regulation and manufacturing, the Adams Daily Report, an electronic newsletter that provides electronic links to the key gaming stories of the day, and the Adams Review, a special report distributed by Compton Dancer Consulting that provides editorial commentary on gaming trends.
Ken Adams
Ken Adams is the principal in the gaming consulting firm, Ken Adams and Associates. Formed in 1990, Ken Adams and Associates specializes in information, analysis, and strategic planning for Indian tribes, casino operations and gaming manufacturers.

Ken spent over 20 years in the hotel-casino industry, prior to founding Ken Adams and Associates. He held the positions of: Director of Casino Operations, Casino Manager, and Keno Department Manager. During this time, he developed numerous innovative marketing and customer development programs and systems for evaluating casino performance. Some of those programs, such as slot clubs and tournaments, have become industry standards.

Ken is also actively involved in gathering and disseminating information that is important to the gaming industry. He is editor and publisher of and the Adams' Report, a monthly newsletter specializing in identifying trends in casino gaming, regulation and manufacturing, the Adams Daily Report, an electronic newsletter that provides electronic links to the key gaming stories of the day, and the Adams Review, a special report distributed by Compton Dancer Consulting that provides editorial commentary on gaming trends.