Will Money Rule?

Hi Everyone,

For those of you not in the know, New York State has decided, (with voter approval last November), that the distressed upstate portions of the state need a shot of big business economic development. The big economical development that voters approved is for up to 4 non-Indian owned licenses for full blown casinos in 3 regions. There would be more jobs and extra money for school systems. Basically sounds good until you look at Atlantic City's casinos where 4 casinos have recently closed. But that is not what today's blog is about.

Genting Americas is one of the companies interested in building a casino in Orange County. All of the companies interested in building a casino in the state had to submit a licensing fee of $70 million. Genting in their infinite wisdom wants to pay a fee of $450 million. That is obviously $380 million more than the state is requiring. Why would Genting want to pay that excessive amount? The reason is simple, they want to build their casino not in a distressed region, but rather in Orange County, where unemployment is lower then the rest of the state and the area's personal income is in the top third of the state's 62 counties. Orange County is not distressed! But that is exactly why Genting wants to build it there.

It is obviously more profitable to build a casino in a wealthy area where people have more money to spend. It is also more profitable to tap into the New York City day trippers rather than have to count on overnight visitors. Thirty five miles south of Orange County is the Yonkers Raceway, (Empire City), which has slot machines and no gambling tables. The Yonkers school system receives $20 million each year from Empire City. If a casino is built 35 miles away, that will siphon people and money from Empire City and hence the Yonkers school system which really needs the money. In addition, one of the regions that really needs help is the Catskills, which has never been the same since their heyday of the 50's and 60's. Several potential casino operators said that they will withdraw their plans if a casino opens next door in Orange County.

What Genting is trying to do is build a casino where THEY want and not where the casino is needed. They want the state's gaming commission to throw out the language of last year's amendment and instead accept their whopping, excessive fee. The bottom line is that an Orange County casino will cannibalize a large part of the existing casino gambling market rather than expand it. There will be only one winner if Genting gets its way and that is Genting.

Hopefully common sense will prevail and Genting won't be allowed to buy a constitutional amendment. Only time will tell. Other regions need the economic help, not Orange County. New York State should not sell out and should listen to what the voters approved.

Til next week.

Peter