James Cassella Says a North Jersey Casino Could Be Worth $1.5 Billion to the State
Mayor James Cassella of East Rutherford is one of a growing number of New Jersey leaders who calls for quick approval of a North Jersey casino license. Mayor Cassella hopes to see a plan set for a Meadowlands casino in the coming months.
Cassella believes a Meadowlands gaming operation could be worth $1.5 billion to the state. He said those numbers are possible even if another casino opens in Jersey City sometime after that. In most areas, competing casinos would cannibalize the market. New York City has a large enough population and a large enough tourist industry, it could sustain two North Jersey casinos, say proponents of such a strategy.
Carl Goldberg Calls for Immediate Action
Carl Goldberg, Chairman for the New Jersey Sports and Exposition Authority from 2002 to 2011, agrees with Cassella. Goldberg says it is critical for the state to install a North Jersey casino as soon as possible.
During a recent speech at Mdest, an annual event sponsored by the Meadowlands Liberty Convention and Visitors Bureau, Goldberg said, “The time for casino gaming, especially here at the Meadowlands, is now–not one year from now, not two years from now, but now. We have an opportunity here to build and create the highest-grossing casino in the western Hemisphere.”
New York Casino Licenses
This fall, New York state will approve licenses for up to four casinos throughout their state. One or two licenses are expected to be approved for Orange County, only 50 miles from New York City. The gaming companies seeking those licenses are huge entities, such as the owner of the largest casino network in the United States, Caesars Entertainment, and an even larger company, the multinational conglomerate, Genting Limited.
If Caesars or Genting are sitting across the Hudson, they will have a head start in building a New York City customer database. That might not sound so imposing, but one of the advantages larger gaming companies have is their databases. When the Atlantic Club closed in January 2014, it was shut down by two rival companies, Caesars and Tropicana. Those rivals split the Atlantic Club’s assets, with one getting the real estate and casino property, while the other collected the slot machines and player database. Having a list of motivated gamblers is just that important.
5-Year Moratorium Is an Albatross
When Goldberg suggests that New Jersey cannot wait two years to build a casino, he is referring to Governor Chris Christie’s 5-year moratorium on approving a license outside Atlantic City. In February 2011, Christie promised Atlantic City casinos they would have a 5-year window to turn around their casino industry, after reforms were enacted. That moratorium will end in February 2016, when all bets are off. Most people assume a North Jersey casino approval will happen sometime after February 2016, but it could be too late by then.
The idea of the moratorium was to give Atlantic City casino operators a chance to change their business model and save the local industry. That initiative has failed miserably, despite the best efforts of officials and executives. By the end of 2014, 5 of Atlantic City’s 12 casinos (at the start of 2014) will have closed.
Atlantic City Companies Playing Both Sides
People might say that the governor’s word should be honored, but one has to consider that those Atlantic City gaming companies are also making alternate plans. Caesars Entertainment owns three of the remaining seven casinos in Atlantic City, and they are seeking a New York license that will further undermine the Boardwalk’s viability. Caesars Entertainment also recently closed down the Showboat Casino, which remained profitable. The Showboat’s closing cost over a thousand local jobs, which outraged workers who felt they had help up their end of the bargain. It’s obvious that Caesars Entertainment is seeking greener pastures, yet New Jersey is expected to hold to a rigid time table that would benefit no one but New York.
The argument might be academic. New Jersey Senate President Steve Sweeney is a supporter of a North Jersey casino, enough so that he’s offered a compromise proposal that would buy Atlantic City support by offering $1 billion over 10 years to help retool the Atlantic City economy. But even Sweeney has said he plans nothing until a November 2015 election. That would be practically on the verge of the February 2016 deadline.
Meadowlands Convention Center Just as Important
Goldberg and Cassella says that a convention center is just as important as a casino, and such a convention center initiative could be started without any political bickering. New York City is a hub of business activity. Collecting the income from a mass wave of conventioners coming to a modern venue would swell the economy with out-of-state and international visitors. Conventions are not likely to move 50 miles from New York City, so the convention center is an idea that would work anytime.
Cassella believes the money is there, but New Jersey’s leadership has to get it right. Cassella said, “We have a poor record at fulfilling promises. Let’s forget about what New York is or isn’t doing. A lot of people like to think big, but maybe we should listen to people and start small and then see how it goes.“
