Friday, September 21, 2018

World Casino News
Golden Entertainment division expands with local acquisition

PT’s Entertainment Group, a division of Golden Entertainment Inc. (NASDAQ:GDEN), has acquired all three of the T-Bird Lounge & Restaurants’ Las Vegas locations. According to the Las Vegas Sun, after completing the acquisition the local pub giant will assume operations of the trio of valley locations including 9465 S. Eastern Ave, 6560 W. Warm Springs Road […]
Casino – CalvinAyre.com
Atlantic City under state control for 3 more years

The state of New Jersey will continue overseeing the fiscal recovery of Atlantic City until 2021, the Office of the Governor announced.

Gov. Phil Murphy has unveiled the report ‘Building a foundation for a shared prosperity,’ submitted to his office by Special Counsel James E. Johnson, which outlines various proposals to be undertaken before control of the city is given back to the local government.

“Atlantic City has a number of challenges that will only be resolved with significant direction from and partnership with the State,” the report read.

Atlantic City under state control for another three yearsIn May 2016, when Chris Christie was still governor, the Municipal Stabilization and Recovery Act (MSRA) was passed by the state legislature to remedy the bankruptcy faced by Atlantic City, whose casinos’ gross gaming revenue (GGR) had declined by 7.5% annually from 2006 to 2014, with some casinos closing down. With the legislation, a five-year period was given for the state’s takeover of local powers.

“The strong State oversight established by MSRA should continue until the earlier of two conditions: the expiration of the State’s authority in the City pursuant to the MSRA; or municipal capacity is on strong footing and the City’s reliance on State transitional aid has been substantially reduced if not eliminated,” the report read.

According to news outlet NJ.com, Murphy, who had campaigned for governor promising to end the state takeover, will push through with the five-year time frame after all. In his view, however, the state was acting more as a “partner” rather than “big-footing” the city.

“Without a doubt, positive things are happening in Atlantic City. However, if we want to see today’s progress endure long into the future, we have to tackle longstanding challenges such as poverty, unemployment, affordable housing and public health. Most importantly, we must invest in the people who live and work here,” Murphy said.

Murphy’s press release also quoted Atlantic City Mayor Frank Gilliam as acquiescent to the ongoing recovery program. “As the mayor of this great city, I have waited patiently for this day. The citizens of Atlantic City deserve to have their local elected officials control their destiny. I am very optimistic that this is a huge step in the right direction for Atlantic City and its future,” Gilliam said.

The state counsel’s report points out that with the MSRA in effect, the municipal budget had shrunk 15%, while property taxes have not increased. However, school and county tax rates have gone up 10.7% and 15.4% respectively, as a balanced budget was passed for 2018.

The report recommended that the New Jersey government “form a task force to review recent casino closings to determine whether changes can be made to the regulatory framework, and suggests that the City expand efforts to promote itself as a destination.”

The report cited the entry of other states as well as Indian gaming into the market as having a big effect on GGR the past decade. “The Review Team is aware of no forecast that anticipates that Atlantic City will recover the market share it enjoyed until 2006 and the jobs created during the recent upswing are likely to be somewhat different from those created earlier… [T]he introduction of internet gaming in recent years has been a significant factor in the recent increase in casino revenue,” the report read.

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Thursday, September 20, 2018

World Casino News
SuperBook to be rolled out across the United States

American casino owner, Westgate Resorts, has announced that it is set to expand the influence of the SuperBook sportsbetting facility located inside its giant Westgate Las Vegas Resort and Casino by offering the sportsbook’s services as a ‘white-label’ solution. Partnering with Paragon Gaming Corporation: The Orlando-headquartered company used an official Wednesday press release to reveal that […]
Casino News Daily
US State and Local Governments Rake in $40.8 Billion in Gambling Taxes

US governments on all levels, federal, state and local, received $40.8 billion in tax revenues from the rapidly growing gambling industry in 2017. The sector contributed $261 billion to the United States economy and employed more than 1.8 million people, a new study by Oxford Economics reveals.

The research, published this week by the American Gaming Association, uncovers the key role of the gambling industry in the nation’s economy. The latest data shows the striking impact of casinos on other sectors such as hospitality, finance, insurance, and real estate. The gambling business has also become a large employer, while tax revenue from it alone provides funds, which would allow for the hiring of 692,000 new teachers, says Sara Slane, senior vice president of public affairs for the American Gaming Association, in an official statement.

According to the American Gaming Association (AGA), casino gaming has expanded to multiple new markets in the past few years, supporting the development and funding of various community projects in education, healthcare, etc. In 2017, the total economic impact of the gaming industry was $261.4 billion. This figure refers to the business sales or the output, which includes much more than just casino revenues.

Instead, researchers at Oxford Economics took various aspects of the gambling industry into account. Native American casinos, for example, generated $33.7 billion in total revenue, while commercial casinos earned $55.7 billion, for a total casino revenue of $89.4 billion. Nearly $73 billion of it represents the gross gaming revenue, while the rest of the money was generated by lodging, food and beverage, and entertainment.

Another figure included in the 2017 statistics is the gaming manufacturers’ revenue, which totaled $6.3 billion. In addition, ancillary spending added another $13.3 billion – these are the purchases of casino patrons that are made outside the gambling facilities but are completely dependent on casinos. Overall, the total direct spending generated by the gambling industry last year was $109 billion. The commercial casino industry brought $40.8 billion in total tax revenues, $10.7 billion of which came directly from gambling.

However, the economic impact of the gambling sales far extends this figure and shows the sector’s actual potential for supporting employment and boosting revenues in many other industries.

Huge Economic Impact

As mentioned above, local, state and federal governments received $40.8 billion in tax revenues from the casino and gambling industry last year. As city and state coffers were boosted by billions of dollars, a wide range of projects and services were funded such as hospitals, schools, public safety, infrastructure projects, educational programs, etc. Interestingly, the total tax impact per household was estimated – it was $343 per US household. In other words, every household in the country received a share of the taxes collected from the gaming sector in 2017.

One of the most important roles of the gambling industry is its influence on employment in the United States, according to researchers. The Oxford Economics study shows that commercial casinos employed 361,000 people, while tribal casinos employed another 198,000 individuals in 2017. The income generated from this labor was $26.5 billion, estimates reveal. An additional 17,100 employees worked for gaming manufacturers, earning $1.1 billion.

Patrons’ ancillary spending, as explained above, directly generated 151,000 jobs in other sectors, with $5.7 billion in labor income. The gambling business supported a total of 727,000 direct jobs that accounted for $33.3 billion of wages, salaries, and tips, the report reveals. That is not all, however, and researchers explain that the business activity of the gaming industry has, in fact, caused a chain effect that ultimately generated indirect labor income of $18.3 billion.

Last, but not least, casino workers, as well as employees in businesses directly or indirectly influenced by the gaming industry spend on services and goods from completely different sectors. As a result, the induced labor income last year totaled $22.3 billion. Overall, the gambling industry supported 1.8 billion jobs that generated $74.0 billion in salaries, benefits, and tips.

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Casino – CalvinAyre.com
MGM adds Ohio’s Rocksino gaming ops to casino portfolio

mgm-resorts-ohio-hard-rock-rocksino-casino-gamingCasino operator MGM Resorts has struck a deal to acquire an Ohio casino from MGM’s real estate investment trust (REIT) MGM Growth Properties (MGP).

On Wednesday, MGM announced that it had agreed to pay MGP $275m for the operating assets of the Hard Rock Rocksino Northfield Park casino, which MGP acquired in April from Milstein Entertainment for $1.06b.

At that time, MGP, which functions purely as a landlord and doesn’t oversee any gaming operations, strongly hinted that it would eventually sell the Rocksino’s gaming operations to an unspecified third party (hint hint) while retaining ownership of the 110-acre land plot.

MGP was created in 2015 as a way for MGM to realize some short-term billions, and now serves as MGM’s primary landlord. MGM said the Rocksino deal will increase its annual payments to MGP by $60m, 90% of which will be fixed and subject to 2% annual increases until 2022.

The Rocksino property is a slots-only venue, but its 2,300 video lottery terminals helped the property generate net revenue and earnings of $293m and $94m, respectively, in the 12 months ending June 30. Rocksino was Ohio’s top-earning gaming venue in 35 of the last 39 months.

MGM CEO Jim Murren hailed Rocksino as “a great fit for the MGM portfolio” due to its “superior asset quality, premium location and dedicated employees.” The property will now be incorporated into MGM’s M life Rewards Program, a move that Murren said will lead to “revenue and profit growth” at the property.

MGP CEO James Stewart did his best to pretend that the REIT had any intention of selling to anyone other than MGM by claiming there’d been “significant third-party interest” in Rocksino’s gaming operations, but MGM had offered “a rental stream at the high end of our expected range and the continued security of our revenues as demonstrated by the strong rent coverage via the master lease.”

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