Bally’s Shareholders Reject Smoking Study

Shareholders of Bally’s Corp. rejected a proposal by anti-smoking groups to study the potential impact of banning smoking inside Bally’s casinos.

Bally’s Shareholders Reject Smoking Study

Shareholders of Bally’s Corp. soundly rejected a proposal to study the potential cost savings of banning indoor smoking at Bally’s casinos.

The proposal was voted down last week during a 10-minute virtual annual shareholder’s meeting that also approved board members, the operator’s accounting firm and other corporate business. According to a Securities and Exchange Commission (SEC) filing, the vote was 23.9 million against the proposal, to 3.1 million in favor.

The proposal was submitted to shareholders by Trinity Health, a Michigan-based nonprofit health care company that owns an extremely small amount of shares, in partnership with Americans for the American Nonsmokers’ Rights Foundation (ANRF), an anti-smoking advocacy group. It asked that the Bally’s board commission a report on the potential cost savings of smoke-free gaming floors.

Cathy Rowan, director of socially responsible investments at Trinity Health, spoke at the shareholders’ meeting, logging negative bottom-line results of allowing smoking, from higher health insurance premiums to higher maintenance costs and lost business from non-smokers.

“There are potential business risks to allowing indoor smoking,” Rowan said. “We shareholders have no guidance as to the cost Bally’s is bearing for continuing to allow indoor smoking. Nor has the company disclosed social or environmental costs and risks imposed on its stakeholders.”

Anti-smoking advocates were encouraged that the vote in favor of the smoking study, constituting 11.6 percent of the shareholder proxy votes, easily surpassed the 5 percent threshold required to resubmit the proposal at next year’ annual meeting.

The proposal to study negative business results of allowing smoking was carried by the Nonsmokers’ Rights organization to shareholders of three different major operators—Boyd Gaming, Bally’s and Caesars Entertainment. Boyd shareholders rejected it at their May 9 annual meeting, and Caesars shareholders will vote at their June annual meeting, the exact date to be announced.

The Caesars vote is to be taken after the SEC rejected the operator’s request to have the proposal dismissed without a vote.

“This vote by Bally’s shareholders sends a strong message to the board of directors and the gaming industry that there is significant investor support for studying the business benefits of implementing a smoke-free indoor air policy,” said Cynthia Hallett, president and CEO of ANRF. “Never before has the topic of smoke-free policies been brought to the forefront of three major casino boardrooms.

“While the proposal may not have garnered majority support, the fact that it was even brought to the table and surpassed the first-year threshold, is a significant victory—smokefree indoor air in casinos is a win for workers, customers, communities, and investors. Casino company executives can no longer ignore this critical health issue for their employees and about 90 percent of their guests who don’t smoke. We look forward to continuing conversations with investors and management on this important issue.”

The shareholder angle is only one of several campaigns across the country to end exemptions to indoor-smoking bans given to casinos. In New Jersey, an advocacy group formed by Atlantic City table-game dealers known as Casino Employees Against Smoking’s Effects (CEASE) joined with the United Auto Workers, the union representing dealers, in a lawsuit against the state, seeking an injunction to end indoor smoking in the casinos.

Anti-smoking groups like ANRF are watching the New Jersey case closely, and similar lawsuits can be expected should the plaintiffs win.

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