Atlantic City eager for 2015 after its worst year

Atlantic City 2015

ATLANTIC CITY, N.J. (AP) — Few people are more eager to see the clock strike midnight on Dec. 31 than Atlantic City casino executives and the thousands of workers who still have jobs there.

Four of the resort’s 12 casinos shut down during 2014 (and a fifth narrowly escaped with a last-minute financing deal just before Christmas), 8,000 workers lost their jobs and casino revenue continued its eight-year plunge.

Several major developments are expected in 2015 that will help shape Atlantic City’s future, including the outcome of state efforts to help the struggling resort town, a decision on whether PokerStars can join New Jersey’s Internet gambling market, the fate of the former Revel casino and a ramped-up push for a statewide referendum on whether casinos should be allowed in other parts of the state.

“It’s got to be better than the year we just had given that we had four closings. In that regard, the worst is behind us,” said Tony Rodio, president of the Tropicana Casino and Resort. “But there’s certainly a lot of uncertainty with the tax situation and the state legislation, and about market conditions. I’d forecast a better year, but still cloudy.”

Kevin Ortzman, president of the Casino Association of New Jersey, said Atlantic City took some bitter but necessary medicine this year.

“Atlantic City experienced big changes in 2014, changes that were very difficult but nonetheless necessary for the greater good of the entire region,” he said.

The biggest question heading into 2015: Is the bleeding over? Casino executives and analysts say the remaining eight casinos have a better chance of success now that the market has contracted; “right-sizing” was a frequently used term in 2014 as The Atlantic Club, Showboat, Revel and Trump Plaza closed. In November, the eight remaining casinos saw their revenue increase by 11.5 percent compared with November 2013.

But it’s too soon to sound the all-clear signal. Gary Loveman, president of Caesars Entertainment, seemed to put Bally’s on notice in October, saying, “We need to make money there.”

Wall Street firm Fitch Ratings predicts Atlantic City’s casino revenue will dip to $2.6 billion this year (from $2.86 billion in 2013) and decline further to $2.5 billion in 2015.

Sometime in 2015, the state Division of Gaming Enforcement is expected to decide whether to let PokerStars, the world’s largest poker website, into New Jersey’s online gambling market. The process has been complicated by the company’s past legal troubles, but a new owner, Amaya Gaming, and personnel changes are aimed at getting a New Jersey license.

PokerStars, with its huge player following, could breathe new life into the state’s Internet gambling market, which took in only about a tenth of the $1 billion many had forecast for its first year of operation. It also would give a boost to Resorts Casino Hotel, which has done without an Internet component for a year while waiting for PokerStars to be approved.

The fate of the former Revel casino hotel remains unclear as well. A Canadian company reached a deal to buy it from bankruptcy court for $110 million but pulled out over a dispute with bondholders over debt from the construction of the casino’s costly power plant. A court hearing on a possible sale to the runner-up, Florida developer Glenn Straub, is set for Jan. 5.

State officials are considering numerous tax and financial aid packages for Atlantic City’s casino and municipal finances, but none has been enacted yet. More are expected to emerge next month from the third summit on the city’s future convened by Gov. Chris Christie.

And lawmakers in northern New Jersey are intensifying a push to get a question before voters on the November ballot on whether casinos should be permitted in other parts of the state. The Meadowlands racetrack and Jersey City are two proposed sites.

Atlantic City’s casinos and southern New Jersey legislators vehemently oppose that prospect, even with large subsidies from a northern casino’s revenue flowing to Atlantic City as a subsidy for the loss of its in-state monopoly.

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Wayne Parry can be reached at http://twitter.com/WayneParryAC

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