Depending on who you talk to, the impending closing of Atlantic City’s Trump Taj Mahal either proves or disproves the need for New Jersey to expand casino gaming beyond Atlantic City.
New Jersey voters will be asked in November to decide on a referendum to allow two new casinos to be built in the northern part of the state—the first to be allowed outside of Atlantic City. No locations for the casinos have been chosen, but proposals for casinos at The Meadowlands Racetrack and in Jersey City are considered the leading contenders.
Proponents have long argued that the state needs to respond to competition from casinos in other states and try to reclaim much of the market Atlantic City has already lost. Opponents say adding even more competition—this time in-state—will further devastate the Atlantic City market and lead to even more casino closings.
Now, with the Taj Mahal closing, both sides say it proves their point.
“The news of the Taj Mahal closing is tragic, and it just magnifies the importance of defeating this referendum,” said Debra DiLorenzo, chairwoman of the No North Jersey Casinos Coalition, which includes Atlantic City-area business and casino interests.
The group has released a report that predicts the addition of two new casinos in the state would likely cause three Atlantic City casinos to close. The report was made before the announced Taj Mahal closing. The report predicted between 23,000 and 30,000 direct and indirect jobs would be lost from these new closings.
Atlantic City area Assemblyman Vince Mazzeo said the closing “only further prove to voters why we need to continue to vigorously fight the referendum to expand casino gaming to North Jersey.” Mazzeo called the expansion proposal “an effort that would put thousands more of Atlantic County’s hard-working middle-class families on the unemployment line.”
However, proponents say new casinos—which would be close to the lucrative New York City market—would bolster the state’s casino industry and generate revenue, some of which is proposed to go to help re-develop Atlantic City as a more diverse resort.
Jeff Gural, who operates the Meadowlands Racetrack and has proposed building a casino there with Hard Rock International, said the Taj Mahal closing proves that the Atlantic City market is already failing in the face of out-of-state competition. New casinos could ultimately generate about $200 million a year to help develop Atlantic City, he said.
“It’s so illogical it’s just ridiculous, letting all this revenue leave the state,” he told the Associated Press. “Not only are we going to help seniors and the state as a whole, which is not doing that great, but we are going to help rebuild Atlantic City.”
Gural and former Reebok chief executive Paul Fireman—who is seeking to build a casino in Jersey City—announced the launching of a new media campaign titled “Our Turn NJ” in support of the referendum that will include television, radio and digital ads. Ads from the group began running early this month.
Sen. Paul Sarlo, who represents the Meadowlands district told the AP that Atlantic City-area politicians need to “get their heads out of the sand” and stop fighting the prospect of new casinos in New Jersey.
“The pending closure of the Trump Taj Mahal should serve as a wake-up call for Atlantic City officials to take advantage of the benefits of casino expansion,” he said. “Expanding New Jersey’s gaming sector to North Jersey will provide financial resources so that Atlantic City can invest in economic expansion. The city has the opportunity and the ability to become a destination resort that doesn’t rely on casinos alone.”
However, so far, there has not been a strong push to persuade voters to support the referendum, even though polls show the state’s voters split on the idea and some polls suggest a majority are against approving new casinos.
State Senate president Stephen Sweeney—a sponsor of the plan—told the Bergen Record he was disappointed with the lack of effort to convince voters before this month.
“I think they sat back way too long,” Sweeney said. “I’m really disappointed that people haven’t stepped up sooner. I always tell people, when you’re running a tough election campaign, you don’t win it in September. You win it in February. You have to build up positive energy.”
Meanwhile, Moody’s Investors Service issued a statement saying the city’s remaining Boardwalk casinos could see a benefit from the Taj Mahal closing. The statement, however warned that the gains would be short-lived and cited the expansion of the Sugarhouse Casino 60 miles away in Philadelphia, the expected opening of a second Philadelphia casino by 2018 and the prospect of two new north Jersey casinos, according to the AP.
As for the Taj Mahal, the casino filed required Worker Adjustment and Retraining Notification notices with the state Department of Labor this week listing 2,848 affected employees. The notice says the layoffs will go into effect on Oct. 10.
Tropicana Entertainment which runs the casino under Billionaire Carl Icahn announced the closing earlier this month. The city’s main casino workers union Unite HERE of Local 54 has been on strike at the property since July 1.
