Gaming

Casino Applications Flow In

More than a dozen gaming entities are submitting literally tons of paperwork to state regulators today to vie for casino licenses in the first round of siting.

The applications require nearly 200 pieces of information including an explanation as to a construction timeline to the casino’s business plan.

The information being released today is expected to provide specific details on the projects around the state for casino construction, with proposal being picked by the fall by the casino siting board.

The first round of casinos is being limited to four regions north of New York City: the Hudson Valley, the Capital Region and the Southern Tier.

Saratoga Casino and Raceway is applying for two projects, with resorts proposed in East Greenbush near Albany, and a second in Orange County.

Caesars Entertainment Corp., meanwhile, submitted an application for an $880 million resort in Woodbury, a project the company estimates will bring $230 million in annual tax revenue.

In Sullivan County, Empire Resorts, Inc. submitted an application for a $1 billion-plus proposal that includes a waterpark, golf course and “adventure park.”

Howe Caverns Resort and Casino also submitted an application for a Capital Region casino, with operator Full House Resorts proposed to run the casino. One of the company’s original founders is former Chrysler Chairman Lee Iacocca.

Gaming Commission Sets Minimum Capital Investments For Casinos

The state gaming commission’s casino siting board on Monday announced the minimal capital investment for casinos in each zone and region.

The investment must include the cost of a casino in a specific area and at least one hotel with additional amenities.

The minimum capital investment is set depending on a variety of factors for a region, including whether a casino is sited in a specific county.

For instance, in the Catksills/Hudson Valley region, the minimum capital investment for a casino placed in Dutchess or Orange counties is $350 million.

But if a casino is not placed those counties, minimum investment for Columbia, Delaware, Greene, Sullivan and Ulster is $130 million.

In the Southern Tier-designated areas of Wayne or Seneca counties, minimum investment is $70 million, the lowest amount needed for a casino-resort facility.

Gaming regulators say they have reviewed a variety of factors in determining the minimum investment, including the climates of carious states such as Massachusetts, Maryland Ohio. The board also reviewed economic and financial models based on estimated gaming revenues for potential locations.

Up to four casinos will be constructed in the first phase of casino construction, including the Albany area and the Southern Tier.

New York’s Big Bet: Not Leaving Corruption to Chance

ICYMI: Here is the final installment of our three-part series on the expansion of casino gambling, New York’s Big Bet. You can view the full series, plus web extras, here.

Fortunes are won and lost in casinos, but a fortune could also hinge on where one is built in upstate New York — and where.

With so much money at stake, critics of casino gambling say the process has the potential to be corrupted.

“I think the public should be very watching very carefully, I think that advocacy groups should be watching very carefully all of the filings for everyone – not just at the state level, but at the local level and elected office. Where is the money pouring in and for what reasons?” asked state Sen. Liz Krueger, D-Manhattan.

State officials and Gov. Andrew Cuomo have insisted the ongoing process to select a casino development project will remain free of corrupt influences, pointing to numerous safeguards put in place, as well as an unusual level of transparency when it comes to the information on the potential developers.

“The cynics said, ‘you’re not going to get the applications, the time is done, gaming is over the curve.’ I think you’ve had more interest and it’s gone better than people suspected that it might early on, so I’m very pleased,” said Cuomo.

Nevertheless, Cuomo’s office isn’t leaving much to chance. According to an internal memo by the governor’s top legal aide, Mylan Denerstein, first obtained by Capital Tonight, Cuomo administration staffers are warned to avoid any contact with casino lobbyists or supporters about the placement process:

Since you may not know whether the person communicating with you is representing a bidder, you should assume that everyone contacting you about any of these issues is representing an interested party and decline to discuss the matter.

New York does not have the best track record with corruption to begin with, and influence from casino companies and other gambling interests have proved for some especially troubling in previous years. In 2010, the state inspector general issued a scathing report blasting the Paterson administration and state lawmakers for turning a bidding process for video slot machines at the Aqueduct Race Track into a “political free for all.”

“For an endeavor of this size and scale, you certainly want to have a comprehensive review process. I’m not going to sit here and say the state always gets it right,” said Heather Bricetti, the Business Council president.

An effort last year to block casino companies from donating to the campaigns of state lawmakers and other candidates was quietly removed from legislation governing casino gambling. The change gave gambling opponents pause.

“I’m very worried still about the corruption influence of gambling and in fact those who have controlled casinos in different states throughout the country have been found to bribe local officials, make side deals with local officials,” Krueger said.

Yet, the state Gaming Commission and gaming facility location board is requiring a large swath of information from developers including financial data. The Gaming Commission’s website is also posting the names of the lobbyists who are representing the various casino developers, and the state is contracting with a Chicago-based law firm to conduct extensive background checks on the companies wishing to build casinos.

“It’s a very voluminous process and the paper applications alone probably constitute 40 pounds alone and you have to submit 20 copies,” said Wilmorite CEO Tom Wilmot.

Developers aren’t necessarily complaining about the state’s financial and legal x-ray of their businesses, noting it’s good for business if the selection process is above board.

“It has to be comprehensive. They have to make the right decisions and they’re doing their due diligence,” said Sal Semola, the president of Foxwoods Catskills Resort.

For now, gambling opponents say they’re watching closely to see how the development process unfolds.

“When millions and millions of dollars are spent on lobbying, there’s no way for a disinterested decision to be made,” said Stephen Shafer, of Coalition Against Gambling.

NY’s Big Bet: How Opposition Campaigns Impact Casino Placement

ICYMI: Here is part two of our series on the expansion of casino gambling, New York’s Big Bet. Part three, taking a look at the myriad regulations to guard against corruption, airs this evening. Online exclusive content from this series can be found here.

Saratoga Springs seems like a natural place to put a destination resort and casino. The prosperous Upstate city owes much of its success to its beloved race track.

And yet vocal opposition arose to the idea of having a full-blown casino with table top games at its racino, where video lottery terminals are currently allowed.

I knew it was a big deal. I guess what I wasn’t prepared for was the influx of extreme negativity that I was hearing from our constituents with regards to a full-blown Las Vegas style casino,” said Mayor Joanne Yepsen, D-Saratoga Springs.

Like many local elected officials in the wake of the statewide casino referendum’s passage last year, Yepsen had to navigate the push for a casino and a passionate base of opposition to one.

“The question for me always was, after Prop One passed, is it better to have a full-blown casino in Saratoga Springs or 30 minutes down the road, and my community expressed an awful lot of opposition for a variety of reasons,” Yepsen said.

In the end, foes of a casino won and the owners of Saratoga Casino and Raceway instead submitted proposals for locations Rensselaer and Dutchess counties.

The reasons for the root of the opposition to a Spa City casino are varied.

“This town – even though it does have gambling, it’s history isn’t just gambling. It’s so much more. We’ve seen a revitilization in the last 30 years focusing on a solid downtown core,” said Colin Klepetar of SAVE Saratoga.

Opposition to a casino in Saratoga isn’t all that surprising. After all, the county voted down the casino referendum last year.

Meanwhile, concerns arose that a casino would potentially draw visitors away from a bustling downtown and be in competition with venues like the Saratoga Performing Arts Center.

“I think it’s not really that surprising. I think that the racino and its size today fits with the scope and scale of Saratoga Springs. The legislation calls for a really massive project with hotels and ameneties and that just does not fit the scope of Saratoga,” said Sara Boivin of SAVE Saratoga.

Supporters say casinos aren’t a competing business for a local economy. Instead, they can compliment existing businesses and destinations.

“I think that was sort of the conventional wisdom when the whole process started was that Saratoga was a place that made sense and the reason being was because they have other attractions,” said Business Council President Heather Briccetti. “There’s a lot of studies out there that show these are complimentary things. They’re not competitive.

The Cuomo administration opposed a bill that would have required a local referendum before a casino could be built in a given community, pointing to enabling legislation that included language for local input.

Nevertheless, the state Gaming Commission adopted a rule that local support be a key factor in its casino placement.

“You want to make sure that this is development that’s supported by the community and the local issues are addressed — the roads, the bridges to get to this facility,” said Sen. Cecilia Tkacyzk, D-Duanesburg.

In the end, the placement of casinos is being decided by the state, but a well organized local opposition campaign could have a huge impact on powerful interests.

NY’s Big Bet Part One: Locating A Casino

Here is part one of our three-part series on casino development, New York’s Big Bet. Part two, which focuses on local control of casino siting, will air tonight on Capital Tonight.

You can watch web-exclusive extras here.

The promises from potential developers of resort-style casinos in upstate New York are huge. As the area gears up for the first round of casino bidding, a complicated and potentially fraught process is taking shape.

In April, 22 bids accompanied by a one million dollar filing fee were submitted to the state’s Gaming Commission. Of those, four projects will be selected to build in three regions of the state: The Capital Region, the Southern Tier and the Catskills and Hudson Valley. Selecting the projects are former New York City Comptroller Bill Thompson, Hofstra University President Stuart Rabinowitz, and gubernatorial adviser and businessman Paul Francis.

“There seems to be more interest than I think many people initially anticipated. We’ve seen 22 submissions so far, which is quite a few consider there are only four slots available,” said Heather Bricetti, Business Council President and CEO.

The developers pledge to transform a moribund economy in a region that has spent a generation struggling to retain jobs, businesses and people.

In a few cases, however, the developers are not being very forthcoming. In some instances, they have not revealed exactly where they would build a casino and others are yet to select an operator to manage the casino.

Nevertheless, some developers are more than happy to share their plans and how they’ll be linked with a local economy. In Seneca County, developer Thomas Wilmot says his resort would be linked with the Finger Lakes wine country.

“It will have a huge impact and then there’ll be many local companies which will be providing a wide variety of services to this facility,” said Wilmot.
We anticipate that many of those patrons will also use other services, whether they go on to visit wineries, do shopping at the outlet center in the immediate area, stay in local hotels.”

Other projects pledge to revive a local economy, such as Foxwoods developers, who believe the Catksills can see economic growth and increased tourism once again thanks to casino gambling.

“If you look at what led to the demise of the Catksills – basically affordable, convenient transportation, that’s no longer the case,” said Sal Semola, president of Foxwoods Catskills Resort.

For business leaders who support casino gambling, this can give developers a leg up in the selection process.

“That is what will set proposals apart – the concepts that integrate themselves into the regional economy so they can build off of what’s already there and make a more attractive picture for tourism,” Bricetti said.

Not everyone is convinced. Opponents of gambling note that casinos can actually make a local economy worse, with issues ranging from increased costs to law enforcement to the impact a gambling addiction has on families.

“Underneath what looks like money coming into the community, there’s also a tremendous loss,” said Stephen Shafer, Coalition Against Gambling in NYS.

A portion of the revenue generated by casino gaming is required by law to be directed to problem gambling, but Shafer believes both the state and casino companies have little interest in helping those with additions.

“About half the revenue from the average casino comes from the net losses of problem gamblers, so the better job the state or the casinos do at deterring and curing problem gamblers and treating and helping problem gamblers recover, the lower their revenues are going to be,” Shafer said.

Watch the Story Here >> (TWC ID required)

Cuomo Counsel: Avoid Casino Lobbyists

Gov. Andrew Cuomo’s top counsel is reminding administration staff to avoid contact with any representatives or supporters of a casino development project, according to a memo obtained by Capital Tonight.

In the memo dated March 31, counsel Mylan Denerstein says that any potential bidders, lobbyists, affiliated supporters, labor groups or even local governments in favor of the project should be avoided if they attempt to contact an executive chamber staffer to discuss the project.

The memo was released as the Gaming Facility Location Board issued requests for applications for up to four commercial casinos spread over three regions of the state.

Last week, the state Gaming Commission announced 22 different projects had submitted a $1 million filing fee to begin the casino review process.

The filing fee is expected to cover an extensive background check on the developers wishing to obtain a lucrative casino license from the state.

Denerstein instructs staffers that the process falls under the state’s procurement law, which she writes places “significant” restrictions on communications between a procuring agency and bidders.

Denerstein writes that communications from supporters or bidders for casino development that fall under questions regarding licensing, support or opposition to a particular casino proposal or questions and comments regarding the application review process should be avoided.

The exception to the rule is if a lawmaker contacts the governor’s office regarding a project.

“Since you may not know whether the person communicating with you is representing a bidder, you should assume that everyone contacting you about any of these issues is representing an interested party and decline to discuss the matter,” the memo says. “The only exception to this rule is that legislators and their staff acting in their official capacity are expressly exempted from the procurement lobbying law and may communicate with anyone regarding the Casino License RFA.”

The memo also outlines how to respond to casino lobbyists or developers by referring them to staff at the Gaming Commission.

Casino Memo by Nick Reisman

22 Entities Submit Casino Bids

Twenty-two entities submitted a $1 million filing fee by Wednesday’s midnight deadline to gain the rights to build a casino in one of three commercial exclusivity zones north of New York City.

The list range include politically connected firms like Caesars Entertainment as well as harness racing companies in Saratoga and Tioga Downs.

Only four proposals will be selected for the three regions: the Albany area, the Finger Lakes/Southern Tier and the Hudson Valley/Catskills region.

The news of the application filing fees signal that start of a new phase of the casino process, initiated first in 2012 when state lawmakers took the first step in approving a constitutional amendment for expanding casino gambling in New York to table-top games.

Voters in November approved the casino referendum.

The filing fee will be used to conduct what state officials say will be extensive background checks on the developers, the companies and the proposals.

Application Fees Received, April 23, 2014 by Nick Reisman

Poll By MGM, Caesar’s Finds Support For Online Poker

A poll conducted by Global Strategy Group and commissioned by casino developers Caesar’s and MGM shows most New Yorkers are open to a measure backed Sen. John Bonacic that would allow for some forms of Internet poker.

The poll found 75 percent of voters believe it should be left up to individual states as to whether they should allow online poker in their states.

Only 18 percent support a Congressional ban on online poker.

And as the state moves forward with the construction of four non-Indian commercial casinos north of New York City, 87 percent of those polled believe the introduction of online poker would no impact on their decision to visit a casino in person.

“New Yorkers are clear – if responsible adults want to play poker online, they should be allowed to,” Jan Jones Blackhurst, Executive Vice President, Communications & Government Relations for Caesars Entertainment Corporation. “They don’t want the Federal or state government telling consumers what to do. We are hopeful that the New York Legislature will pass a bill regulating online gaming, protecting consumers from illegal sites and bringing revenue back to New York from overseas.”

The bill, introduced by Bonacic late last week, would allow for Internet versions of Omaha Hold ’em and Texas Hold ’em.

The poll comes as casino magnate and prolific political donor Sheldon Adelson is undertaking a high-profile effort to ban online gambling, and has recruited former Gov. George Pataki to help lobby.

Online Poker Poll Release Memo by Nick Reisman

Senate Confirms Gaming Commission Chairman

The state Senate on Tuesday confirmed the nomination of Mark Gearan to be the new chairman of the state Gaming Commission — a regulatory body that will consider the licenses of casino developers in parts of the upstate region this year.

“I am pleased to welcome Mark Gearan, a proven leader with years of management experience in the public and private sectors, to serve as Chair of the Gaming Commission,” Cuomo said in a statement. “Casino gaming holds the potential to create thousands of new jobs in Upstate New York, while providing millions of dollars to schools and local governments statewide. Mark’s decades of public service and great work leading Hobart and William Smith Colleges will be of tremendous value in this new role , and I thank him for taking the time to serve on the Gaming Commission.”

Cuomo last month named former state operations director Paul Francis, Hofstra University President Stuart Rabinowitz and former city comptroller Bill Thompson to a panel that will consider casino placement.

Due to agreement with the state’s Indian nations, and enabling language approved by the Assembly and Senate last year, the casinos in the first phase of construction will be limited to areas north of the New York City area: The Capital Region, the Southern Tier and the Catskills.

Four casinos will be built in the first phase of construction.

The governor in January announced that request for proposals for casino construction will begin this month and the final approval is expected by the fall.

Three Named To Casino Siting Panel

The state Gaming Commission on Thursday made the first three appointments to its casino siting committee, who will be officially named to the panel at the commission’s next meeting.

The appointees are:

  • Paul Francis, a former business executive and adviser to the past three governors, Eliot Spitzer, David Paterson and Andrew Cuomo. He is currently a senior fellow at the Guarini Center on Environmental and Land Use Law at NYU Law School,
  • Stuart Rabinowitz, the president of Hofstra University on Long Island, and
  • Bill Thompson, the former New York City comptroller and two-time Democratic mayoral candidate.

All three appointees are from the downstate region.

Due to agreements struck by the Cuomo administration with the state’s American Indian tribes and the enabling legislation approved by lawmakers earlier this year, the casinos built in the first phase of construction will be limited to north of the New York City area: The Capital Region, the Southern Tier and the Catskills.

Cuomo announced last month that request for proposals for casino construction would be due in March, with final approval expected by the fall.

“These individuals have the expertise, objectivity and knowledge of New York State to evaluate the applications to operate destination resort casinos,” said Chairman-Designate Mark Gearan. “I thank them for their commitment to bringing much-needed economic development, revenue and jobs to Upstate New York.”

The legislation requires the siting panel to develop an application form, determine a casino license fee and analyze the application for casino construction and location.