The Revel Casino Hotel in Atlantic City, New Jersey, is
due to close in September unless it finds a buyer. Photo from FacebookBloombergView says governments shouldn't depend on gaming to boost their revenues or economically depressed areas:
From the day it opened in April 2012, Revel Casino Hotel in Atlantic City loomed as a shimmering $2.6 billion monument to misguided optimism. Now, deeply unprofitable, it plans to close. Its saga illuminates two misconceptions about the relationship between gambling and government. The first is that casinos will be a savior for state and local budgets. In the months before Revel opened, New Jersey Governor Chris Christie was brimming with confidence about the revenue the resort would bring, even after the state had to guarantee $261 million in tax credits to restart construction on the project when its original investor, Morgan Stanley, walked away. When Revel finally opened its doors, it failed to attract much business as Atlantic City's gambling revenue continued its long decline. Now, in bankruptcy for the second time, it's one of four gambling houses in the city expected to close this year, taking with them nearly 8,000 jobs. As casino competition intensifies -- more than two dozen have opened on the East Coast since 2004, with another 12 planned -- reality is hitting home elsewhere, too. In Delaware, the legislature has approved back-to-back bailouts of the state's casinos after they threatened layoffs. Indian tribes have been seeking federal grants as their gambling revenue has dried up. In New Jersey, programs for the elderly and the disabled funded by casino cash are now imperiled. And in impoverished East St. Louis, which relies on a casino for nearly half its budget, weak gambling receipts have contributed to cuts to police and fire departments.Get the Story:
Editorial: Atlantic City, Reveling in Its Losses (BloombergView 8/14) Related Stories:
Four of 12 casinos in Atlantic City to close amid revenue slump (07/15)
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