Atlantic City has been through such difficult times that talk of bankruptcy permeates the air. The city’s main industry, gambling, has been decimated as newer casinos in nearby states have drawn players off the New Jersey shore with its famous boardwalk.
New Jersey Governor Chris Christie is not standing still in this turn of events. He has appointed a restructuring team, including former Detroit emergency manager Kevyn Orr, to review the alternatives. Is this just one step in an autopsy? After all, Kevyn Orr is the guiding light that bankrupted Detroit.
Truth be told, can anyone work magic in a city that saw 4 of its 12 casinos close last year? Then there’s the Trump Taj Mahal, which barely avoided closing, remains on life support, and is looking for a white knight investor. Caesars Entertainment, which owns Bally’s Atlantic City and Caesars Atlantic City, filed for bankruptcy last month.
“No one should expect the appointment of a very competent tax manager to be the solution for Atlantic City,” said Peter Reinhart, professor and director of the Kislak Institute of Real Estate at Monmouth University, as it would not solve the underlying problems of a stagnant tourism industry and casinos.
In addition to the downward spiral of casino gambling, there is also the threat of online gambling. Now you can add New Jersey to the number of states that allow online gaming. The Garden State joined Nevada and Delaware as the only states with legalized online gambling, and is now the largest by population.
How does that affect gambling in the destination? It doesn’t help. However, many do not play alone. The tourist complexes offer shows, seminars and conventions, both for leisure and business. Ultimately, casinos can be the biggest winners because, as it stands now, online gambling websites must operate through casinos. But for how long? And, as states seek revenue, some will inevitably turn to online gaming as a source to help fill their coffers, which may lead them to loosen this restriction. Every time a player can place a bet online instead of having to go to a physical location, there is one less player available to all casinos, including Atlantic City casinos.
Atlantic City is a city of 40,000 people, 48 blocks long, three-quarters of a mile wide at its widest point. Its budget is about 270 million dollars. About a third of its residents live in poverty. More than two-thirds of its adults 25 and older have a high school diploma or less. Atlantic City remains the only place in New Jersey where casino gambling is legal.
Is any casino working well? “Good” can be a relative term. The remaining casinos, at least, are still open. They are Borgata, Tropicana, Resorts and Golden Nugget. The decline began in 2007, a year after Pennsylvania UFA opened up spaces. In four years, Pennsylvania pulled Atlantic City out of second place behind Nevada in annual gaming revenue. In 2013, Pennsylvania’s gross gaming revenue was $ 3.1 billion. There is also competition from New York that allows betting in the Catskills and various counties.