Pinnacle is out, replaced by the Chickasaw
Two development groups have withdrawn from the high-stakes battle for four New York casino licenses. That leaves 20 casino bidders vying for four Class III gaming licenses. Complete proposals must be submitted by June 30. State regulators are expected to award the licenses by fall.
Pinnacle Entertainment had been looking at sites in the Albany region. But its development partner, Flaum Management, chose to go with Global Gaming, run by the Chickasaw Nation. Rolling Hills Entertainment had also expressed interest and paid the $1 million application fee, but had not announced details about its plan.
Casinos will be built in the Albany-Saratoga area; the Southern Tier-Finger Lakes area; and the Catskill Mountains, in the mid-Hudson Valley.
The Catskills are expected to snag two of the four licenses. But developers there are upset about several proposals for Orange County, closer to New York. Five groups including Caesars Entertainment and the Malaysian-based Genting Group say a casino on the outskirts of the nation’s largest metropolitan region would be the biggest revenue generator, and thus the best bet for taxpayers.
But a casino close to New York City could divert downstate gamblers and keep them from traveling farther upstate. And Governor Andrew Cuomo was explicit that his plan provide economic stimulus to the struggling upstate region.
“The Catskills have been thought to be the target for this the whole time,” said John Sabini, former chairman of New York’s Racing and Wagering Board. “And if something opens up in Woodbury (in Orange County), it really diminishes any value to any Catskill license.”
“When you look at the kind of bright, shining city Orange County is, versus what Sullivan County is, clearly the need is in Sullivan County,” agreed Charles Degliomini of Empire Resorts Inc. That company wants to build a $750 million resort in partnership with Kansas City-based EPR Properties at its Monticello racetrack.
“If we don’t have something around here for people to get their lives in order, we’re going to be in trouble, without a doubt,” added William J. Rieber Jr., supervisor for the town of Thompson in Sullivan County.
Nevertheless, Genting hopes to build a multimillion-dollar casino in the community of Tuxedo, less than an hour from the Big Apple. According to the Berhad Star, the gaming company has offered to fund a $25 million highway interchange to help drive traffic to the site. The so-called Sterling Forest Resort would include a casino, a 125-acre forest garden, and an “adventure world.”
Genting Malaysia is “a strong contender to win the casino, chiefly because of its proven track record and financial muscle,” reported the Star. Genting Malaysia’s wholly owned subsidiary Genting New York operates the first and only racino in New York City, at the Aqueduct Racetrack. Since opening in October 2011, it has broken U.S. records for slot revenues.
As the pool of bidders debates the possibility of an Orange County casino, a source close to Cuomo told the New York Post the administration likely will “figure out how to put (casinos) farther upstate.”
Meanwhile, other developers are out pressing the flesh and drumming up public support. Saratoga Casino and Raceway and Churchill Downs Inc., the developers of a proposed Casino at East Greenbush in Rensselaer County, have won the approval of the Town Board. Now they have to win over residents. A new Facebook page called No East Greenbush Casino has nearly 700 “likes.”
Community support for the respective projects is non-negotiable, according to the state Gaming Facility Location Board. Saratoga Casino was forced to look outside its own back yard, in Saratoga Springs, due to community opposition.
Schenectady seems to be enthusiastic about a casino development at the former ALCO site. The partners there are local development company the Galesi Group along with Rush Street Gaming, which has three regional casinos: Sugar House in Philadelphia, and the Rivers casinos in Pittsburgh and Des Plaines, Illinois.
Local leaders say the casino would provide stability to the Electric City riverfront “for the next 100 years,” according to the Albany Business Review.
“This day will be a game-changer for the city and county of Schenectady,” said Galesi Group COO David Buicko at a recent public hearing. “We’re turning a blighted riverfront of abandoned buildings into a thriving mix of residential, retail, hotels, office, and entertainment.”
“It’s going to create economic benefits, jobs, tax revenues, and I think it will be a home run all around,” said billionaire Rush Street Gaming Chairman Neil Bluhm. “We think we have the best site in the region. And we think we’ll generate the highest revenue in the state.” Schenectady’s City Council has yet to pass a supporting resolution.
In Rochester, residents who oppose a $350 million gaming resort in Seneca County are getting support from a national anti-gaming organization.
According to the Auburn Citizen, Les Bernal, of the Stop Predatory Gaming Foundation, recently visited the town of Tyre, where real estate developer Wilmorite wants to build a casino. Bernal said states with casino gaming tend to be “the biggest financial basket cases in the country.”
“This is a failed idea,” he said.
Near Binghamton, the resort Traditions at the Glen has chosen Seneca Gaming as its operating partner. The company, a division of the Seneca Nation, which operates three casinos in Niagara Falls, Buffalo and Salamanca, will operate the casino adjacent to the existing resort and convention center.
And in Albany, casino opponents are going door-to-door to marshal support against the proposed Flaum-Chickasaw casino. Common Council member Judd Krasher said most residents in his ward voted in favor of the November’s proposition to expand gaming. “But in talking to people now, it has come closer to home and I’m hearing a lot of opposition,” he told the Citizen.
Across the river in New Jersey, some lawmakers are calling on Governor Chris Christie to OK casino gaming outside Atlantic City now, before New York opens. North Jersey politicians have been lobbying for a casino at the Meadowlands racetrack for years. In 2011, Christie gave Atlantic City five years to stabilize its decimated gaming industry before he would consider an expansion of gaming in the state.
“Cuomo is kicking our butt right now on seeking to open facilities that will be very attractive to a strong demographic in Bergen and Passaic counties,” said state Senator Paul Sarlo. “There is a finite amount of gaming revenue that can be captured, and an Orange County casino would have a negative impact on a casino in the Meadowlands. I just hope this leads the governor to reassess his time frame.”
But a spokesman for Senate President Steve Sweeney insists the action in New York has not changed Christie’s timeline. Sweeney and Christie have “made a five-year commitment to Atlantic City, and intend to stick by that commitment,” said Chris Donnelly.
