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Legislators consider mobile gambling devices at casinos, tax breaks for nongaming projects in Atlantic City
Feb 06, 2012 (The Press of Atlantic City - McClatchy-Tribune Information Services via COMTEX) --
Lawmakers are considering a pair of bills that could allow Atlantic City gamblers to play their favorite games from the comfort of their hotel rooms while offering hefty tax breaks to companies seeking to build nongaming attractions in the resort.
The two bills modify last year's historic casino deregulation and Tourism District legislation, expanding their scope while adding new elements and tweaking it to accommodate unforeseen consequences.
Sen. Jim Whelan, D-Atlantic, sponsors both bills and chairs the Senate State Government, Wagering, Tourism and Historic Preservation Committee, which will discuss the bills Monday afternoon.
One provision may let casino visitors take their poker hand back to their room -- or their poolside deckchair.
The proposal would allow casinos to let patrons gamble on mobile gaming devices. Whelan said this was an attempt to interest younger gamblers, many of whom live in a world of convenient handheld devices.
"They play computer games, and so on, and they text and they Facebook on their iPads and their smartphones, and so forth, and so I think it makes sense to recognize what was not even thought of 30 years ago and is now a reality," Whelan said.
Whelan said discussions with regulators made him confident the devices could be kept out of the hands of underage players.
While this would untether gamblers from the table, it is a far cry from Internet gaming, which remains illegal. Whelan said "You step off the premises and this thing goes kaput."
Instead, wireless play would be limited to patrons with established accounts, playing approved games inside the casino property on regulator-approved devices.
Wireless gaming has been a part of Las Vegas since 2005, when it became the first gaming jurisdiction in the country to offer that option. State officials previously considered this in 2006 but shelved the idea.
The Casino Association of New Jersey, the lobbying arm of the resort's casinos, supported it. In a statement, association President Bob Griffin said "this innovation would provide an additional amenity to help Atlantic City further distinguish itself as the East Coast's premier gaming destination."
The bills would also offer as much as $200 million in state tax credits to spur nongaming development in Atlantic City.
Whelan said this was a long-standing request from the Greater Atlantic City Regional Chamber.
Chamber President Joseph Kelly said the organization has sought the program because lawmakers specifically drafted other state tax credit schemes to not apply in Atlantic City.
The proposal would apply to either nongaming properties in the Tourism District, or properties the Casino Reinvestment Development Authority finances or controls in the resort, all of which the bill refers to as the Atlantic City Economic Zone.
To qualify, projects must require at least $20 million in capital, create 100 jobs and be considered by the state Economic Development Authority to "yield a net positive benefit to the state."
A business could apply to the EDA to deduct $2 million a year from its state corporate business taxes, insurance premiums taxes and gross income taxes over 10 years, or $20 million in all. Unused credits can carry up to 20 years.
Mixed-use projects can also qualify if at least $5 million in nongaming development is proposed in projects of at least $20 million.
The credit could be cut 20 percent if the firm reduces employment below the 100-job threshold, and revoked entirely if the company reduces employment across the state by 20 percent until the jobs are restored.
Businesses that participate in several other state grant and incentive programs are disqualified, and unless the EDA approves a separate tax credit certificate, credits are lost if a facility is sold.
Erin Gold, EDA spokeswoman, said the authority does not comment on pending legislation.
"We would not allow it for casino expansion itself," Whelan said. "But if someone is developing something else, like a commercial retail center or office space, this would be a tool that would be available."
Both Whelan and Kelly said the proposal was advanced without specific projects in mind. However, it would seem to include both the Steel Pier and The Walk shopping plaza. Both are within the Tourism District and plan substantial nongaming expansion.
Anthony T. Catanoso, Steel Pier president, said he was unaware of the proposal. The pier plans $100 million in upgrades over the next three years and he said other tax incentives "will be a critical component to our program over the next several years."
Baltimore's Cordish Companies sold a controlling interest in The Walk last spring, but retain the rights to develop Phase IV, a mixture of restaurants, bars and live entertainment called Atlantic City Live!. Cordish spokeswoman Arlene Friedman wrote in an email "No one at our company knows anything about the bill."
Another provision would allow casinos to rent slot machines in exchange for a percentage of income, rather than own them outright.
Whelan said this may change, as most casinos opposed the move out of fear they would eventually be forced to lease the machines and not own them outright.
This could cut into revenue, if casinos are forced to share revenue from the lucrative devices or be locked out of the newer machines by slot companies.
The Casino Association of New Jersey did not address this issue in its statement, and Griffin did not respond to a follow-up question.
"I'm getting input from this issue from all the casinos and slot machine companies and trying to come up with something that safeguards everyone's interest," Whelan said.
Other provisions clarify and expand on the original legislation:
Membership in the Atlantic City Alliance resort marketing group would be expanded from firms that have invested at least $1 billion to all casinos. The annual $30 million assessment that funds the organization would now be based on gross revenues and assessed quarterly;
Employees with key licenses could gamble outside of New Jersey, but be banned from in-state wagers;
Casinos could pay a casino junket company based on the patrons' actual gambling activities, provided the contract is approved in advance;
Employees transferred as a result of the Tourism District consolidations retain their seniority.
Contact Derek Harper:
609-272-7046
DHarper@pressofac.com
___ (c)2012 The Press of Atlantic City (Pleasantville, N.J.) Visit The Press of
Atlantic City (Pleasantville, N.J.) at www.pressofatlanticcity.com Distributed
by MCT Information Services
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