Hard Rock, Meadowlands Unveil Casino Plan

North Jersey lawmakers joined Hard Rock Chairman Jim Allen and Meadowlands Chairman Jeff Gural to unveil the casino plan for Meadowlands racetrack. Meanwhile, a bill to authorize up to three casinos in North Jersey has been introduced into the state Assembly. The bill is short on details but long on enthusiasm.

Lawmakers seek ballot question this year

Key local lawmakers and construction union leaders gathered last week at the Meadowlands Racetrack in East Rutherford to announce details of a grand plan for North Jersey’s first casino in partnership with Hard Rock International.

The Hard Rock Casino at Meadowlands Racetrack would be a $1 billion casino and entertainment complex adjacent to the North Jersey track’s new grandstand, and would offer 500 slot machines, 200 table games, 10 restaurants, four bars, a multi-purpose Hard Rock Live showroom, and a lineup of music memorabilia from the world’s largest collection of iconic rock artifacts.

The casino also would include signature Hard Rock offerings besides the memorabilia, such as the trademark center bar, and “The Vault,” a music memorabilia museum curated by Hard Rock. There also would be a New Jersey Music Hall of Fame, with inductees going beyond Bruce Springsteen and the Four Seasons to include non-rock icons like Frank Sinatra.

The grand vision was laid out by Hard Rock International Chairman Jim Allen and Meadowlands Racing & Entertainment Chairman Jeff Gural, who has already invested more than $100 million into improvements at the track, including the recently completed $85 million grandstand which features sports bars overlooking the racetrack and a rooftop lounge with killer views of Manhattan. Hard Rock contributed a 16 percent equity stake to that project.

“This is not just a legendary day for our brand, but a tremendous opportunity for the state of New Jersey,” said Allen, a South Jersey native and still a resident of the state (as well as Florida, where Hard Rock is headquartered). He said the Hard Rock Meadowlands plan “is about maximizing the potential for the state of New Jersey… It’s about how we can grow the tax base, create more jobs and create more opportunities here in the state of New Jersey.”

If approved, Allen said, the first phase of the new casino could be open by summer or fall of 2016. Allen predicted the facility could generate $400 million in new tax revenue annually, not only because of the collection of attractions and proximity to New York City, but because of a proposed 55 percent slot revenue tax, similar to the casino’s closest competition, the casinos in Pennsylvania and New York.

Speaking to reporters after the event, Allen said a hotel at the Meadowlands would be something to be considered in the future, but with nearly 10,000 hotel rooms already available in the immediate area, it is not a priority.

Allen said the casino’s Manhattan neighborhood—without traffic, the racetrack is 15 minutes from Midtown—and its location minutes from the Newark airport mean Hard Rock would be not only an attraction for North Jersey locals, but for visitors from around the world. “With its close proximity to an international airport, the new casino would be designed to attract visitors from not only the 14 million adults in northern New Jersey and New York City, but also international travelers, making it a premier entertainment destination,” Allen said.

Those international travelers, he said, would join a regional market that could make the Meadowlands one of the most successful casinos in the country. “One of the challenges that Atlantic City has is its lack of population,” said Allen. “The population of Atlantic County is only 280,000-plus people. Compare that to Parx in Pennsylvania, with over 7 million people; to Aqueduct in New York, 14 million people. There are over 14 million people within 50 miles of where we are sitting today.”

To become reality, of course, the casino would require an amendment to the New Jersey state constitution, which restricts casinos to Atlantic City. Allen, Gural and the assembled North Jersey lawmakers all stressed that 2015 is the year to get it done. To get the issue on this November’s election ballot, both chambers would have to pass a constitutional amendment referendum bill by two-thirds margins by August 1.

The assembled lawmakers—which included Senate Majority Leader Loretta Weinberg, Assembly Speaker Vincent Prieto and state Senator Raymond Lesniak, among others—all predicted the issue will reach the ballot this year, although there was a noted absence from the dais of South Jersey lawmakers, who have steadfastly opposed creating a North Jersey casino.

The lawmakers and Gural stressed that a statewide vote this year is essential, because the issue would be lost amid the din of campaigning in next year’s presidential contest. Gural went as far as to say if the issue fails this year, lawmakers should wait until 2017 to focus the full attention of the voters on the potential benefits of a North Jersey casino.

The politicians and business leaders assembled said they will push to get the referendum on this year’s ballot. “There is no better time than right now for New Jersey to leverage economic impact and revenue generation that is sorely needed,” said Jim Kirkos, president of the Meadowlands Chamber of Commerce. “I don’t understand why we would wait a year or two years to make this happen. New Jersey has a revenue problem right now, and we can fix that revenue problem… We have waited long enough.”

State Senator Paul Sarlo, chairman of the Senate Budget Appropriations Committee, added that the revenue-strapped state can no longer ignore the possibility of $400 million a year. “We’ll do what we have to do to get this facility built,” he said. “We will work together to make this a reality. We’re going to get this done.”

The lawmakers and Gural countered the arguments frequently logged by South Jersey legislators that a Meadowlands casino would further harm Atlantic City by piling in-state competition on to the Pennsylvania and New York gaming that has devastated the resort town’s gaming revenues, causing four Boardwalk properties to close last year.

The Hard Rock project, they said, would benefit all of New Jersey. Gural said the projected $400 million in annual revenue—nearly twice what is generated by all the Atlantic City casinos—would represent spending by New Jersey residents who currently go to Sands Bethlehem in Pennsylvania, Yonkers in New York, or elsewhere outside of the state.

“This is not a fight between North Jersey and South Jersey,” Gural said. “We’re fighting New York and Pennsylvania—we need to bring back the people in northern New Jersey who now travel to those casinos.”

In fact, Allen stressed that the new casino would actually help Atlantic City. “The significant tax revenue brought into New Jersey could go directly to aid in the development and reconstruction of Atlantic City’s casino and hotel industry,” he said, pointing to studies showing that a casino in northern New Jersey would help draw visitors from other states, creating competition with New York and Pennsylvania.

Gural also noted that the project is essential to New Jersey’s horseracing industry. Although it is the largest harness-racing facility in country, he said, the Meadowlands struggles to compete with Pennsylvania and New York tracks able to use slot revenues to offer purses that are double what his track offers.

Allen and Gural both stressed that the Meadowlands casino will “not be slots in a box,” but an attraction that will draw people from other states with a brand that is recognized around the world.

“We’re thrilled to bring this great offering to the new Meadowlands Racetrack,” said Gural. “With its expertise in gaming, hotels, restaurants, live events, entertainment and retail offerings, Hard Rock International is the ideal partner for new Meadowlands Racetrack. Bringing the globally recognized brand to the racetrack elevates excitement surrounding the project.”

Allen said the partnership is committed to hiring New Jersey residents, with special preference to the nearly 10,000 casino workers displaced by the Atlantic City closings. He said the project also is committed to using local construction trades—to the applause of the assembled collection of union leaders. The project is expected to generate a minimum of 2,360 construction jobs, and 4,000-4,500 permanent jobs once open.

Weinberg said that while the nature of the two bills to be pushed through—one to create a statewide ballot question and one for enabling legislation—has yet to be ironed out, as many as three North Jersey casino licenses could be created, one each for Sussex and Hudson Counties in addition to the Hard Rock facility in Bergen County. However, she said that if only one North Jersey license is approved, it should be for the Meadowlands casino.

“We will work together to make sure this moves ahead,” Weinberg said, “and the Meadowlands is the place for a casino in North Jersey.”

While the legislators expressed confidence they will get the referendum to change the constitution passed, Allen said he is confident voters will approve the casino once given the question. He cited a recent poll of likely 2015 voters that indicated 53 percent approval for a Meadowlands casino, while a separate poll question indicated that 73 percent of those polled said the Meadowlands would be the best location for a northern casino if approved.

For now, the Meadowlands project ends speculation that Hard Rock will be launching any Atlantic City projects in the near future. Speaking with GGB News after the press event, Allen said that while Hard Rock has kicked the tires in Atlantic City by considering buying closed properties like Revel and Showboat, the company is only interested in new construction in the resort, which he said is not likely to happen for a number of years.

He also said he feels the regional market would be able to handle Hard Rock and at least one more facility, such as the project proposed for nearby Jersey City. “We understand the market is being discussed as potentially two or three locations,” he said, “and we certainly have based our models of the size of the market understanding that it is a debate the House, Senate and governor will need to navigate.

“I think there’s enough business under our plan. The one thing we have that is different than some of the other companies is that we will market this on an international platform. All over the world, this will become part of our marketing portfolio.”

Two weeks ago, New Jersey Governor Chris Christie said on a radio talk show that he is now in favor of a northern casino.

Now, the question remains whether the North Jersey lawmakers assembled at the Meadowlands last week can convince their colleagues from the south of the state that it’s time for casinos outside of Atlantic City, and if it does get on this year’s ballot, whether or not it will pass.

Speaking to GGB News, Sarlo acknowledged passage will be a tall order, but said Senate President Steve Sweeney, a Democrat who represents the southern counties of Atlantic, Cape May and Cumberland—who, like other South Jersey lawmakers, was absent from the press event—is supportive of the Meadowlands project.

“Let’s not kid ourselves; the Senate president needs to post a bill,” Sarlo said. “He’s supportive. The question is whether or not he thinks it’s viable for this year—whether we’re able to get the votes out in a short period of time. It’s a sprint. If we get it done in July, we need to wage a campaign. We need to educate and inform the electorate why this is so important.

“We have our work cut out for us.”

Should the ballot question be approved, Gural said he and Allen are prepared to spend $10 million to $20 million on advertising this summer and fall to get the referendum passed, adding that the campaign would cost three times as much in a presidential election year, when advertising rates soar.

Sweeney opposes putting the measure on the ballot this year because he fears it will interfere with his re-election campaign this year. Democrat power boss George Norcross III is also opposed, fearing that negative backlash could defeat Democrats and threaten their majority in the state Senate. Without Sweeney and Norcross on board, it’s doubtful any casino bill reaches the ballot this year.

Meanwhile, former casino employee Assemblyman Ralph Caputo, a Republican who represents Essex County (home of the Jersey City proposal), joined Assembly members Valerie Vainieri Huttle (D-Bergen) and Raj Mukherji (D-Hudson) in a separate press conference in Trenton to announce the constitutional amendment legislation to authorize not more than three North Jersey casino licenses, for Bergen, Essex and Hudson counties.

Caputo, the Assembly Tourism, Gaming and Arts Committee chairman, said the competition from neighboring states has changed attitudes in the legislature concerning gaming outside of the seaside resort. He said North Jersey casinos are necessary to “resurrect” the state’s gaming industry.

“We can’t sit by any longer,” Caputo said. “I worked in Atlantic City more than 20 years; I understand the industry from the inside. The business has changed. We’ve had a tremendous amount of competition from neighboring states, and a downturn in our economy. That vicious competition has taken $2 billion of taxable revenue away from the state of New Jersey. It also has created a regional depression.

“To survive in anything, you need to adapt. And if you don’t adapt, you become extinct.”