ATLANTIC CITY — Multiple appointees for two casino-related decision-making agencies are serving past the expiration dates of their terms and waiting on Gov. Phil Murphy to take action.
Five members of the Casino Reinvestment Development Authority Board of Directors and two members of the Casino Control Commission are holdovers, some of whose terms expired as far back as 2018.
The 17-member CRDA board also has two vacancies, one of which has been open since April and the other since August.
A spokesperson for the Governor’s Office declined to comment on the status of appointments on both boards.
ATLANTIC CITY — The Casino Control Commission named Alisa Cooper, a native of the resort, as…
Casino Control Commission Vice Chairwoman Alisa Cooper and Commissioner Sharon Anne Harrington are both holdovers at the state agency. Harrington, who was first nominated to the commission in 2009 to fill an unexpired term, has been in holdover status since August 2018.
Cooper was appointed to fill an unexpired term in 2012 and has been serving past her current tenure’s expiration date since August of this year.
Both commissioners earn an annual salary of $125,000 for the full-time positions.
Neither Harrington nor Cooper is eligible for reappointment since they have each served the maximum number of terms.
ATLANTIC CITY — State Sen. Chris Brown has recommended city employee Pamela Fields for a sea…
Prior to 2011, Casino Control Commission members could only serve 120 days past the expiration date of their appointed terms. Commission members are appointed to five-year terms.
The governor, with the advice and consent of the state Senate, is responsible for appointing commissioners to the Casino Control Commission.
CRDA Board Chairman Robert Mulcahy III along with board members Michael Hanley, Howard Kyle, Edward Gant and Resorts Casino Hotel President/CEO Mark Giannantonio are holdovers. Gant’s term expired in June 2018, while the other members’ terms ran out this year.
Mulcahy earns an annual salary of $23,000 as chairman, while Hanley, Kyle and Gant are each paid $18,000, as are the other public members of the board. Giannantonio, as one of two casino industry representatives on the board, is not compensated.
ATLANTIC CITY — Gov. Phil Murphy has appointed U.S. Sen. Cory Booker’s former chief of staff…
Public member appointments to the CRDA fall into one of three statutorily outlined categories: nominated by the governor and confirmed by the state Senate (6), recommended by the Senate president and confirmed by the governor (2), and recommended by the Assembly speaker and confirmed by the governor (2). Public members serve four-year terms.
One of the gubernatorially nominated seats has been vacant since April.
The remaining CRDA board seats are filled by two casino industry representatives (one of which is vacant), the Atlantic City mayor, a Casino Control Commission member, and ex officio members of the Governor’s Office, state Treasury and Attorney General’s Office.
Modia Butler was the most recent member appointed to the CRDA board. Butler, a partner at Mercury Public Affairs LLC and former chief of staff for U.S. Sen. Cory Booker, D-N.J., was recommended by Assembly Speaker Craig Coughlin, D-Middlesex, and confirmed by Murphy in October 2018.
1. Gaming revenues eclipse $3 billion
Total annual gaming revenue reported by Atlantic City casinos went over $3 billion in November. The last time gross gaming revenue in Atlantic City was more than $3 billion for a calendar year was in 2012, when there was 12 operational properties. Two gaming amenities that were not available six years ago — online casino and sports betting — accounted for $544.5, or 18%, of the reported annual revenue through November.
In 2018, total gaming revenue for the entire industry was just under $2.86 billion.
"AC is on a winning streak," said Casino Control Commission Chairman James T. Plousis. "2019 marked the fourth consecutive year of growth for the Atlantic City gaming market and I believe it is poised for continued positive results in the new year."
The $3 billion revenue benchmark was significant for the industry's host city as well because it means Atlantic City will receive $20 million more in 2020 as part of the payment in lieu of tax bill signed in 2016 at the onset of the state takeover.
2. A.C. through the eyes of the head honchos
Two top executives associated with Atlantic City casinos offered blunt, and rather bleak, assessments of the seaside resort.
Jim Allen, chairman of Hard Rock International and CEO of Seminole Gaming, told a trade magazine that he was "disappointed" in Atlantic City after the company spent more than $500 million to revamp the former Trump Taj Mahal Casino Resort and reopen the shuttered Boardwalk property as Hard Rock Hotel & Casino in 2018.
Allen, who cut his teeth in the industry working in Atlantic City during its heyday, added that he still saw many of the same problems today that were prevalent decades ago. Despite "promises" from state and local leaders that things would change, Allen said the city is in "worse shape today than it was two years ago," when Hard Rock was starting its Boardwalk project.
Golden Nugget Atlantic City owner Tilman Fertitta, whose property had the second-largest decline in revenue from slot and table games in 2019 due, in part, to the addition of Hard Rock and Ocean Casino Resort in mid-2018, said there were too many gambling parlors for all to be successful.
"It’s not a nine-casino market, and I don’t understand why nobody realizes that," the billionaire hospitality mogul said in September. Fetitta said the market was repeating the same mistake it did several years ago before outside competition and a national recession contributed to the closure of five casinos in two years.
"It’s a seven-casino market, and when it was seven casinos, everybody was putting money back into the properties," he said. "Now, they won’t."
3. Bruce Deifik, 1955-2019
While only a part of the Atlantic City casino scene for a brief period, Deifik's death on April 8 was still deeply felt throughout the industry. The man who took a gamble on the former Revel Casino Hotel to reopen it as Ocean Resort Casino (now Ocean Casino Resort) died while leaving a baseball game in his home state of Colorado.
He was 64 years old.
From the time Ocean opened until he left the property in early 2019, Deifik was the face of Ocean Resort. He was often seen on the casino floor interacting with guests and employees and his likeness was plastered on promotional gaming dollars called "Bruce's Bucks."
4. The ebb and flow of Ocean Casino Resort
The year started off with uncertainty for the mega-resort, as an ownership change in January was needed because of a lackluster seven-month stretch where the property lost more than $23 million, according to state gaming regulators. Luxor Capital Group, a New York-based hedge fund that had financed a significant portion of Deifik's $229 million investment, assumed control and changed top management.
After the state Division of Gaming Enforcement and the Casino Control Commission approved the change, Luxor immediately spent $70 million at Ocean, with $50 million being used to pay down outstanding debt obligations and the remainder being infused into the gaming side of operations toward promotional expenses to attract, and retain, core casino players.
The strategy appears to have paid off — at least in the short-term — as Ocean reported its first truly profitable three-month period in the third quarter of 2019. After bleeding red ink for much of 2018 and half of 2019, Ocean posted a $10.2 million gross operating profit for July, August and September.
5. Caesars and Eldorado Resorts merger
In a classic case of the minnow swallowing the whale, Reno-based Eldorado Resorts Inc. announced in July it would spend $17.3 billion in a cash and bond deal to acquire Caesars Entertainment Corp. The deal was approved by shareholders from both companies in November. If approved by federal and state regulators, the merger would create the United States’ largest owner and operator of gaming assets with nearly 60 properties in 18 states.
Both Eldorado, parent company of Tropicana Atlantic City, and Caesars Entertainment, operator of Bally’s Atlantic City, Caesars Atlantic City and Harrah’s Resort Atlantic City, are current casino license holders in New Jersey. In 2020, state gaming regulators will be tasked with determining whether the merger would create an "undue economic concentration," since the newly formed company, which will operate under the Caesars name, would control four of Atlantic City’s nine casino properties.
6. N.J. is challenging Las Vegas for sports betting supremacy
It only makes sense that New Jersey — who spearheaded the effort to overturn a federal sports betting ban outside of Nevada and paved the way for nationwide legalized wagering in 2018 — would challenge Las Vegas for the top spot throughout the United States. Since taking its first legal sports bet in 2018, gamblers have placed more than $5 billion in wagers in New Jersey. More than $4 billion has been wagered at New Jersey's casinos and racetracks and with mobile/online operators through November, according to state gaming regulators.
"Nevada is clearly in our sights," Gov. Phil Murphy said during a sports betting conference in April. "We can overtake it as early as next year."
Atlantic City's casinos and their mobile/online partners generated more than $111 million in revenue from sports betting and just shy of $13.7 million in taxes for state coffers in 2019.
"New Jersey sportsbooks will remain the chief beneficiary as long as neighboring New York refuses to legalize sports betting," said Dustin Gouker, lead analyst for PlayNJ.com. "New York City's 8 million residents continue to be a key ingredient that has propelled New Jersey into Nevada's chief rival as the country's largest legal sports betting market."
7. Online gaming continues to grow
The massive growth of online casino gaming is a bit of a blessing and a curse for Atlantic City casino operators. The $433.3 million in revenue it has generated through the first 11 months of 2019 has helped boost the bottom line for some operators, but significant portions of the income goes directly to third-party platform providers.
Despite the seemingly double-edged sword that is internet gaming, 2019 was, by far, the biggest year in online casino gaming for Atlantic City since it was legalized in 2013, both in terms of pure dollars and percentage growth. In 2019, online gaming increased 60.7% over the same period last year, a figure that is nearly double the next closest percentage increase (2016, 30.9%).
"Six years in, and it's clear that online casinos have been a win across the board in New Jersey," said Eric Ramsey, online gaming analyst for PlayNJ.com. "Not only do online casinos continue to increase revenue at a breathtaking pace, they have built a symbiotic relationship with online sports betting. Online sportsbooks and casinos are helping to fuel each other's growth."
8. What's going on with the three former casinos on the Boardwalk?
The individual fates of the former Atlantic Club Casino Hotel, the former Trump Plaza Hotel & Casino and Showboat Hotel Atlantic City were all part of the narrative of 2019.
Colosseo Atlantic City Inc., a New York-based investment firm, purchased the Atlantic Club site in October. The buyer stated the former gambling parlor would be operated as a non-casino hotel.
Showboat owner Bart Blatstein was deemed suitable to seek a casino license by state regulators in March. Blatstein told the Casino Control Commission he intends to circumvent an existing deed restriction on the Showboat that prevents it from operating as a casino by constructing a gaming facility on an adjoining land parcel. Blatstein has not yet been approved by regulators for a casino license.
The Trump Plaza remains vacant at the center of the Boardwalk. Local officials continue to refer to billionaire hedge-fund manager Carl Icahn's property as an "eyesore" in the heart of the city. In January, Icahn purchased the deed to the property and terminated a complicated lease agreement signed by President Donald Trump in the early 1980s. The move effectively eliminated a sticking point that would complicate a sale of the property.
9. Mr. Johnson goes to Trenton...twice
Jim Johnson, former special counsel to Gov. Phil Murphy for the Atlantic City transition, testified for a review of existing casino regulations before committees in both the Assembly and Senate. Johnson even brought in an economist affiliated with Rutgers University who detailed how any further expansion of the Atlantic City casino market could be trouble for existing operators.
In his 2018 report on Atlantic City, Johnson recommended that lawmakers and regulators consider modifying the current standards that govern the industry in the wake of increased regional competition and to prevent future collapses, such as the one seen between 2014-2016 when five Atlantic City casinos closed. While not endorsing any tangible options, Johnson's report suggested potential modifications to regulations, such as a limit on the number of available casino licenses or a cap on total market capacity.