Atlantic City's Casino Crisis: A Cautionary Tale
STEVE INSKEEP, HOST:
Atlantic City began the year with 12 casinos. But if you'd like, you could try to place a bet on how many they'll have by the end of the year - could be as low as eight. The New Jersey shore town and its key industry are at a turning point. From member station WHYY, Emma Jacobs reports.
EMMA JACOBS, BYLINE: Bettie and Tom Stine are standing outside of the Showboat Casino, which announced this month that it would close on August 31.
BETTIE STINE: I like tables.
TOM STINE: She likes the tables. I like the tables. But I like to sneak away and play craps sometimes.
JACOBS: The Pennsylvania couple have been coming to Atlantic City since gaming was introduced in the late '70s and lived through the heyday of its East Coast monopoly.
B. STINE: When it first opened up it was, like, unbelievably packed. You couldn't - you had to wait to get a slot. You had to - there were lines.
JACOBS: Today, the Stines and others widely agree, the casinos aren't doing the business they once did. Besides the Showboat, Trump Plaza recently announced plans to close in September. Atlantic City's newest addition, Revel, is in its second bankruptcy.
PEGGY HOLLOWAY: Gaming revenues in Atlantic City have declined about 46 percent from the peak in 2006.
JACOBS: Peggy Holloway is a senior vice president at Moody's Investors Service.
HOLLOWAY: The decline in Atlantic City predated the recession. And it was really a function of a lack of reinvestment in the properties themselves and then the advent of gaming in the contiguous states.
JACOBS: The Stines see this on their drive to Atlantic City from Pennsylvania, passing billboards advertising casinos in their own state. Plus there are several places to gamble in New York, Delaware and Maryland. Even a guy paid to be an Atlantic City booster, Jeff Guaracino of the Atlantic City Alliance, will frankly say that there's a glut of gambling in and around Atlantic City, and so it's been trying to reinvent itself with other attractions.
JEFF GUARACINO: Atlantic City is blessed in that we have the resources and the beach, the boardwalk, the retail, the hotels which are as quickly as possible transforming itself into a new kind of travel economy.
JACOBS: And while revenues from tourism and conventions are approaching a $1 billion a year, it's still a lot less than the 5 billion the casinos made at their peak a couple of years ago. And unfortunately, it's not enough to replace what's projected to be a loss of 8,000 jobs this year. The president of the casino workers' union, Bob McDevitt, wants the casinos to remain open under new owners.
BOB MCDEVITT: Closing a casino or casinos at this point, when we're just beginning to turn the market around, is a mistake.
JACOBS: McDevitt argues Showboat, where he once worked, is still making a profit. That could be attractive to a buyer. The bankrupt casino, Revel, has never posted a quarterly profit. But it has a building finished just two years ago at a cost of $2 billion. New investors might turn it around, he says. Maria Sanchez is a part-time dealer at Revel, mostly blackjack and poker. Sitting just off the boardwalk, she says she's optimistic the job she loves will be saved.
MARIA SANCHEZ: Revel's not going to close. I have a feeling it's not. I have a feeling somebody's going to buy it because it's too beautiful.
JACOBS: Maybe that will help Revel beat the odds, but gambling revenues are slowing throughout the wider region. And so what's happening in Atlantic City is looking like a cautionary tale. For NPR News, I'm Emma Jacobs in Philadelphia.