Atlantic City rolled the dice big time on casino gambling, and it's starting to look like it came up craps.
With the planned September closing of the shiny, silvery, futuristic Revel Casino Hotel, built at a cost of $2.6 billion just two years ago in hopes of making huge profits from slots, poker, and blackjack players, Atlantic City has to admit it is facing immense employment and revenue problems, and New Jersey politicians are scrambling to find a quick solution, according to The Wall Street Journal
Gov. Chris Christie plans to convene an emergency meeting of politicos and casino officials on Sept. 8 to tackle the gambling mecca's problems.
The Revel isn’t the only victim.
The Showboat and Trump Plaza say they are shutting their tables this year, costing Atlantic City 7,000 jobs, and the Revel shutdown will siphon off another 3,100 jobs. The Atlantic Club shut its doors in January, according to the Journal
The unemployment rate in Atlantic City was 13.1 percent in June, more than double the New Jersey rate of 6.4 percent. In all, about a quarter of casino jobs are evaporating.
According to Bloomberg News
, Atlantic City derives 70 percent of its income from casinos, but competition from casinos in other states has eaten into the take so deeply that Moody's has slashed Atlantic City's rating by two steps on the city's $245 million of debt. The Revel alone was paying $19 million in property taxes.
Atlantic City has enjoyed a monopoly on New Jersey gambling, but pressures are mounting for other areas to be allowed to open casinos. Bloomberg reports that Christie gave the city five years to reverse its decline in 2010 before opening New Jersey to more casinos. Three years back, the Revel received a $261 million investment from New Jersey, which would receive in turn a fifth of the casino's now-disappearing profits, The Washington Post
In a press release, Christie said, "We know that the transformation taking hold in Atlantic City is about more than just gaming and gaming-related attractions.
"Important signs are evident of the progress taking hold in the non-gaming development and economic activity we are seeing in AC, including businesses opening, attractions being added, and key non-gaming revenue streams rising."
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