Possible Casino Cap
The casino market in Atlantic City has finally reached a level of stability after a decade of struggling. Gaming revenues suffered for many years as the region tried to regain a foothold. In 2014, four casinos shut down and a fifth was inactive by 2016. However, the region is now doing well due to market stabilization. Online gambling has also contributed to overall growth.
Experts and officials now feel that the time has come to review gaming regulations to prevent another downturn for the industry. Jim Johnson, the special counsel reviewing the state’s involvement in Atlantic City, has co-authored a transition report recommending that policymakers consider regulatory reform.
The goal would be to determine whether changes are necessary to ensure the gaming market’s stability. Nine casinos are now operating in the city. The report suggests that the number of casinos for the region or the total capacity of the city’s gaming venues should be capped.
The transition report said: “Atlantic City’s fortunes remain closely tied to the health of the casino industry. The shuttered casinos now haunting the Boardwalk are powerful reminders that while there can be significant benefit from learning lessons from failure, there can also be devastating costs to forging ahead without heeding those lessons.”
The market had only seven gaming venues until June 2018, when the Ocean Casino Resort and the Hard Rock Atlantic City opened for business. The Ocean Casino Resort is located in the former Revel Casino building and the Hard Rock is in the former home of the Trump Taj Mahal. The Revel closed its doors in 2014 and the Taj was shut down in 2016.
With the opening of the two casinos last year and the continued growth of online gaming, experts were worried that saturation would soon occur. If the market were to become too crowded, issues could arise. Stability is a major concern and past issues are the reasons that the report suggests policymakers should review the market as it stands now.
Atlantic City Regulators
In Atlantic City, the gaming industry is regulated by the Casino Control Commission and the Division of Gaming Enforcement. Casino Control Commission Chairman James T. Plousis said in an email that the commission has reviewed the report’s recommendations. The group is committed to working with the relevant agencies to find the best path forward for Atlantic City.
New Jersey’s Casino Control Act can help with stability. The commission is required to consider if a new license issued or a property sale to an existing license holder would create undue economic concentration. So far, the commission has yet to deny such an application based on these terms.