More casino gaming in the East Coast region and other proposed gaming regulation changes have left Atlantic City’s casino industry most at risk in the near term among casino destinations according to a recently released report by Fitch Ratings.
Pennsylvania, New Jersey and Arkansas have all moved to increase casino gambling, with both New Jersey and Arkansas bringing referendums before voters. In New Jersey, voters will be asked to approve the first casinos in the state to be built outside of Atlantic City. That will cannibalize Atlantic City casinos, potentially resulting in additional closures there, according to the report.
In June, Fitch predicted that as many as four Atlantic City casinos could close if the construction of two casinos in northern New Jersey is approved.
“The regulatory landscape casinos have contended with, in some cases for many years, is continuing to evolve,” said Alex Bumazhny, senior director at Fitch. “As iGaming gains steam, daily fantasy sports rules develop and individual states consider expansion, Atlantic City is not the only jurisdiction contending with the swift changes.”
The report also said an expansion of gaming in Pennsylvania would exacerbate the recently passed 2 percent increase on table games tax, which will cost the states’ casinos about $17 million per year. Casinos in Missouri, Louisiana, and Oklahoma would be most impacted by casino expansion in Arkansas.
The report also noted the Seminole Tribe of Florida’s stalemate with state legislators. Fitch believes the tribe will ultimately renegotiate a compact that allows it to keep its authority to offer table games given the economic benefits it provides the state via jobs. Pending federal lawsuits may eventually catalyze a ratification of the proposed compact, the report said.
