In Louisiana, state Senate President John Alario and three Senate colleagues are awaiting the results of a study, due February 15, which they commissioned to determine what the state should require from Harrah’s New Orleans Casino in exchange for a 30-year extension of its operating license. Alario said the study will provide an independent evaluation of the value of the casino’s license. “It could be the vehicle to approving Harrah’s plan. It could also be the vehicle that crashes it. We just want to know what’s the best deal for the state and how can we accomplish that. If it’s a good arrangement for the state, let’s move forward and get it going,” he said.
Alario and state Senators Eric LaFleur, Jack Donahue and Gary Smith hired New Orleans consulting firm Sisung Group last November to prepare the study. The move was in response to a bill sponsored by House Speaker Taylor Barras, which would extended the Harrah’s New Orleans’ license for 30 years, giving it the right to operate the only land-based casino in New Orleans. Barras’ legislation, presented six years before the casino’s license would expire, did not call for any bidding process and also eliminated lodging and restaurant requirements Harrah’s owner, Caesars Entertainment, objected to.
More than 20 Caesars lobbyists promoted Barras’ bill, which also had the support of Governor John Bel Edwards and New Orleans Mayor LaToya Cantrell. However, the Senate amended the bill to require the casino to make a minimum annual payment of $80 million instead of the current $60 million. Senators explained Caesars planned to spend $350 million on upgrades if the license extension was approved; that would generate $20 million in additional annual tax revenue for the state.
But Caesars objected to the increase, leading to the bill’s ultimate failure. Donahue said, “All these fiscal conservatives in the House who don’t want to spend a nickel on anything voted to blast it through. That’s amazing to me. How can you make a decent decision if you have no information? I don’t have anything against Harrah’s. I don’t mind voting for it as long as I can get some information to know that it was the right thing to do. Voting without that information, I’d call that a bad vote. That’s why I voted against the Senate bill.”
Harrah’s New Orleans General Manager Dan Real said he believed the study “will show that there is a good deal to be had. There’s potential for a win-win here. If we can find the right deal, we would love to pursue it.”
Caesars officials have said they’re uncertain whether the casino will remain in New Orleans; no major upgrades have been made there in recent years. Some observers said that’s why Harrah’s win has dropped from a peak of $419 million in 2008 to $281 million in 2017 and its tax payments to the state fell from $90 million in 2008 to $60 million in 2017.
The state economic development department also is preparing a comprehensive study of Louisiana’s gambling industry, due April 8.
