Author: Casino Connection Staff

On September 22, the Nevada Gaming Commission (NGC) gave final approval to Bally’s Corp. with respect to its acquisition of Tropicana Las Vegas—now, the company is looking to potentially overhaul the property as early as 2024.

Bally’s first announced it was acquiring the operations of the Tropicana from Gaming and Leisure Properties (GLPI) back in April, for a total of $308 million. The two sides then agreed to a 50-year lease, starting at $10.5 million per year and increasing periodically.

The deal also involved Bally’s selling the property rights of two other venues in Illinois and Colorado to GLPI and then leasing them back as well.

During regulatory proceedings, George Papanier, president of Bally’s, told state officials that the company will view the Strip property as its West Coast “flagship” location moving forward, over its existing Bally’s Lake Tahoe casino.

According to Papanier, the company will continue to operate the Tropicana as is for at least a year before announcing an official redevelopment plan. That plan could involve outside partners, which is a possibility the operator is currently exploring.

Bally’s Chairman Soo Kim, on the other hand, previously told reporters that the company may even explore options related to full or partial demolition and reconstruction. He was adamant, however, that the property will be rebranded at some point with the Bally’s name at the very least.

NGC members were also particularly curious about the operator’s finances moving forward, given the fact that the company recently won approval to build a massive $1.7 billion resort in Chicago, the city’s first and only casino.

Papanier was quick to downplay such concerns, telling commissioners that “we certainly have the bandwidth in our company to do that.”

Nebraska made history on Saturday, September 24 with the opening of the first state-licensed casino. It finally came after voters approved three initiatives in November 2020, one of which changed the state constitution to allow games of chance. 

The WarHorse Casino, located in Lincoln, saw hundreds of people arrive to the facility, eager to play one of the 433 slot machines at the temporary casino. The Nebraska Racing and Gaming Commission granted the license a day earlier. 

The casino was set to open at 10 a.m., but 30 minutes before, while a crowd of more than 100 people waited outside, Tribal Elder and member of the Winnebago Tribe of Nebraska’s Tribal Council Ken Mallory was among the first to play a slot machine. 

“What’s the difference between praying at church and praying at the casino?” Mallory joked to reporters and dignitaries as he pulled a slot machine. “At the casino you really mean it.” 

While there was general enthusiasm from the public about the casino’s opening, there is uncertainty when the other five will be available to the public. 

The initiative also called for casino-style gaming and sports betting at the race track casinos, often referred to as racinos. Since sports betting will only be allowed in casinos, the state will be losing millions in online wagering, usually the majority of a state’s handle. For example, neighboring Iowa, which permits online wagering, had 89.8% of its wagers placed online in August, accounting for $108 million of its $122.6 million in handles. 

Where Iowa will be affected is visitors from Nebraska who before the Lincoln casino opened, had to travel 64 miles up Interstate 80 to Council Bluffs, Iowa to visit the closest casino. 

Nebraska is taxing casinos 20 percent on its revenue. Of the taxes collected, 70 percent will go to the state’s Property Tax Credit Fund, while 25 percent goes to the city and county where the casino is located, split evenly, and 2.5 percent each to the state’s general fund and Compulsive Gamblers Assistance Fund.

When advocates were campaigning to get the initiatives passed, they claimed $45 million could be collected in taxes annually. That figure, however, was based on six fully operational casinos and sportsbooks, something that is at least a year away. 

How much revenue WarHorse Casino will provide to the state is unclear. By comparison, Harrah’s Council Bluffs Casino wagered $51.4 million on slots in August, with revenue of approximately $5.4 million. 

If the Lincoln casino can generate those types of figures, they could raise $1 million in taxes. 

Due to the influx of cyberattacks against both tribal and commercial casinos over the past decade, the Nevada Gaming Control Board (NGCB) has proposed new cybersecurity regulations to better protect both operators and their patrons.

The NGCB held a workshop on September 26 with a number of high-profile gaming companies around the state to discuss these proposed obligations. During the 75-minute meeting, the board made it clear that if the regulations go into effect, operators would then be obligated to notify state officials of any cybersecurity breach within 72 hours.

October is federally recognized as Cybersecurity Awareness Month, and the Nevada Gaming Commission (NGC) will meet October 20 to vote on whether or not to approve the new regulations, which would go into effect starting January 1 of next year.

Since the beginning of 2020, cyberattacks have affected casinos in five different states—Arizona, Wisconsin, New Mexico, California and Oklahoma—and in November of that year, the FBI’s Cyber Division issued a formal warning to casino operators, specifically tribal owners, to start ramping up security efforts.

Commercial operators haven’t escaped these issues either, as Las Vegas Sands, Hard Rock, Binion’s and Affinity Gaming have all reported data breaches since 2014.

During the recent workshop, NGCB Chair Brin Gibson said that the board wants and expects all operators to invest in cybersecurity in order to protect the gaming industry and its patrons, which he called a “critical piece of the state’s infrastructure.”

If approved, the new regulations would require all operators, including race/sportsbook and iGaming companies, to conduct multiple risk assessments and audits from third parties with cybersecurity expertise in order to form best practices.

Gibson maintained that there is no mandated schedule for these assessments. However, he also noted that that is not a “safe harbor for licensees to do nothing between now and December 2023,” and if unreported breaches are discovered, “we still reserve the right to take action under Regulation 5 (that governs the operations of gaming establishments).”

Iowa requires its operators to assess security systems every two years, and Louisiana enforces a three-year schedule. Some have predicted that Nevada may opt for an annual obligation, but representatives from the South Point in Las Vegas said that this is too much for single-property operators to take on.

In a statement, the company said, “Risk assessments aren’t inexpensive and for single-property licensees generally have to be performed by an outside consultant. We believe a risk assessment should only be required to be performed once every three years. … While we believe the requirement of a risk assessment every three years is adequate, that does not mean that a licensee will not continuously monitor the adequacy of its protection. We simply don’t believe an expensive procedure like a risk assessment should be mandated on an annual basis.”

South Point also requested that the regulations, if approved, should not go into effect until November 1, 2024 in order for operators to have enough time to get the proper resources in place.

Jim Barbee, head of the NGCB’s technology division, responded by saying that risk assessment should be a continuous process, and shouldn’t be tied to a time window, as that may make operators lazy.

“By setting a floor, it might imply the X number of years is an acceptable method of doing things, but if you waited three years for a risk assessment, you would be grossly out of date and at much more risk,” he said.

Boyd Gaming also requested that “the definition of cyberattack be revised to include the term ‘successful’ to clarify that minor, entirely unsuccessful attempts to gain unauthorized access do not rise to the level of concern intended to be covered by the regulation.” The board agreed.

A Louisiana resident has initiated a class-action lawsuit against MGM Resorts International over the operator’s policy of keeping the change portion of cash-out tickets.

Like many casino operators, MGM deploys ticket redemption kiosks that do not dispense change. When a slot player uses a kiosk to cash out a ticket for, say, $15.80, it dispenses $15 and a voucher for the remainder. If the player wants the 80 cents, a visit to the casino cage within 30 days is required. The operator uses the leftover change from thousands of tickets to fund promotional programs.

New Orleans resident Leane Scherer filed suit and invited others to join the class action, saying casino customers “have been deprived, little by little, of millions of dollars” by MGM’s no-change policy. The lawsuit notes that there are no signs or kiosk messages noting that the kiosks do not dispense change, and nothing on the loose-change ticket says it can only be redeemed by a cashier.

The lawsuit alleges breach of contract, conversion, unjust enrichment and quantum meruit, the doctrine requiring parties to be paid what they deserve or have earned.

The potential class consists of patrons who played at an MGM Resorts casino after September 19, 2012 and were deprived of leftover change.

MGM has declined to comment on the case.

For months now, speculation has swirled regarding Caesars Entertainment and its quest to sell one of its Las Vegas Strip holdings—many have posited, by process of elimination, that it is the Flamingo on the auction block, but progress appears to be stalling as the third quarter of 2022 comes to a close.

Caesars had entered into a previous agreement in 2019 with VICI Properties, a real estate investment trust (REIT), in which VICI acquired the land and assets to three Harrah’s casinos, as well as the rights of first refusal for Caesars’ Strip properties, those being the Flamingo, Paris Las Vegas, Bally’s Las Vegas and Planet Hollywood.

During an earnings call in August, Caesars CEO Tom Reeg told investors, “ we have an ongoing sales process for a Strip asset that’s governed by the VICI agreements and ends about another month to run.” Now that that timeline seems to have expired, some sort of extension is expected to be announced.

The company has never confirmed that it is actively shopping the Flamingo, but reports first surfaced around six months ago that the operator is seeking around $1 billion for the iconic Las Vegas destination. In addition, Caesars has continued to make investments in the other properties listed, whereas the Flamingo, despite its well-known deficiencies, has remained largely untouched.

One could argue that these inherent renovation expenses are the driving force behind the lack of action, but Reeg said on the August call that there are “plenty of interested parties.”

Ongoing economic uncertainties certainly aren’t helping prospects, as rising interest rates will likely limit the number of potential buyers to those who can afford to pay cash.

In that case, private equity firms and large tribal operators stand out as the most likely candidates.

Black-owned Maryland media company Urban One is out of the running, at least temporarily, for what was planned as the One Casino in South Richmond, Virginia, after a second referendum on the casino was pulled from this year’s November ballot.

Virginia’s casino law provides for five casinos, subject to voter approval. Urban One’s planned Richmond casino was narrowly defeated in a referendum vote in 2021. The contract signed by the company and the city states that the agreement “shall be void and of no force and/or effect if a majority of those voting do not approve” in the November 2022 referendum.

The cancellation also impacts Churchill Downs, which was going to operate the casino through a contract it acquired when it purchased Peninsula Pacific last year.

Richmond Circuit Court pulled a planned second referendum vote for November’s ballot after a request from the city saying it would be best to wait a year. Under the contract, no vote this year voids the contract.

The Richmond City Council could still select Urban One’s project a third time and send the matter to voters in November 2023. However, there is also a possibility that the Virginia General Assembly could select a competing city, Petersburg, to replace Richmond as the Central Virginia casino location.

Georgia-based Pace-O-Matic recently treated several Pennsylvania lawmakers to an all-expenses-paid trip to Wyoming for Cheyenne Frontier Days, that state’s ultimate summer rodeo festival. The company makes slot-like skill games which, in Pennsylvania, are not legalized or regulated, but hoped to show how Wyoming does both.

Pennsylvania approved slot machines in 2004 and has expanded legalized gambling ever since−except for skill games, which continue to proliferate throughout the state although they are not authorized under the state’s gambling law and are not regulated by the Pennsylvania Gaming Control Board. Officials estimate more than 50,000 skill-game machines currently operate across Pennsylvania; they do not pay the 54 percent tax on revenue like other gambling devices at the state’s 16 casinos.

Pace-O-Matic and other manufacturers claim the games are not illegal since they require skill and physical ability for a successful outcome. They also claim they want state law to formally legitimize, regulate and tax their industry, even though they benefit financially from the legislature’s lack of action. But casinos and other gambling companies argue the state is saturated with gambling and added competition will cannibalize revenue from the existing market.

Also, the Pennsylvania Lottery, which sold $5 billion in scratch-off tickets between October 2017 and March 2022, said it lost $650 million due to skill-game gambling machines at lobby retailers.

Both sides have hired lawyers and lobbyists to advance their positions and have donated hundreds of thousands of dollars to key lawmakers’ campaigns. Last summer, several top Republican state senators returned donations they had received from Pace-O-Matic and other skill game makers, noting the games are unregulated.

Since early 2019, legislators and other elected officials have received contributions totaling about $1.2 million from political action committees associated with the skill-games industry, according to campaign finance reports. The donations include $28,500 to House Majority Leader Kerry Benninghoff, $8,350 to state Rep. Sue Helm, chairwoman of the House Gaming Oversight Committee, and $47,500 to state Rep. Greg Rothman, who all participated in the Wyoming junket. Pace-O-Matic’s guests received airfare, tickets to two concerts and two rodeos, meals and hotel rooms.

Benninghoff and Rothman reimbursed Pace-O-Matic for their expenses, including their hotel stay, about $1,700 not including airfare. Benninghoff spokesman Jason Gottesman said, “Rep. Benninghoff went on this trip to inform himself of how another state has dealt with a complex issue in a growing industry. He has not, nor will he not, allow those who provide amenities or campaign support to get in the way of him standing up for the best interests of Pennsylvania.”

Helm has not reimbursed Pace-O-Matic for the expedition. She said it was “not a lavish trip. They weren’t paying for first-class airfare.” Besides, she added, “I went more for the learning experience.”

Mike Barley, another Pace-O-Matic spokesperson, explained, “We invited Pennsylvania lawmakers from the House and Senate gaming committees and leadership to the event for the opportunity to meet with Wyoming legislators to learn how they regulated the skill game industry and how the system now successfully works in the state.”

Currently Pennsylvania has no ban against or limits on gifts lawmakers may accept from lobbyists, although gifts worth more than $250 and travel and hospitality valued at more than $650 must be reported. Recently, House leaders again did not bring up a bill to ban gifts, lessening its chances for a floor vote before the 2-year legislative session ends in November.

Arlington Park celebrated the dubious anniversary of its last day of racing.

The course is being liquidated before the Chicago Bears continue their due diligence on a pending $197.2 million purchase of the track, according to the Daily Herald.

That leaves only Hawthorne Race Course in Cicero, which received its 2023 race dates. Thoroughbreds entered the starting gate for their 2022 fall meet at Hawthorne on September 23. It’s a study in contrasts between the racetracks in the Northwest and Southwest suburbs.

Churchill Downs Inc., Arlington’s owner, calls the real estate too valuable for horse races, while the fourth-generation family owners of Hawthorne await a casino license to convert into a racino.

“We can’t wait,” Tim Carey, Hawthorne’s president, told the racing board at the dates hearing. “We fought for 12 years down in Springfield to get this legislation. We’ve done everything possible. The minute it was signed, we ran hard.”

The gaming board must give final approval for the project. Hawthorne is gathering the financial disclosures to regulators.

Racing Board Chairman Dan Beiser asked Carey if he’s comfortable with the financing that would make the project a reality.

“Absolutely, yes,” Carey said.

The expansion and renovation call for slot machines and table games, dining areas, a multilevel parking garage and upgraded wagering facilities. A temporary sportsbook, operated in partnership with PointsBet, has already been installed.

The project would involve 1,200 construction jobs, Carey said.

Meantime, thoroughbred racing will run from March 4 through Labor Day.

“Right now, when you look over there every day, there’s not a lot of optimism,” said David McCaffrey, the Illinois Thoroughbred Horsemen’s Association executive director. “If that project is going and you see progress, I think that that’s going to mean a lot and it’s going to allow people to invest in their stables.”

Arlington’s closure meant that thoroughbreds shared time with harness owners and trainers.

Harness had the track in January, February and March; thoroughbreds started in April, May and June; trotters returned in July, August and early September; and thoroughbreds just resumed.

Next year harness racing will begin at the state fairgrounds in Springfield June 12 to August 31, then come to Hawthorne in September.

“We’re in difficult times. We all realize that and we’re trying to do the best we can,” said Chris Block, president of the thoroughbred horsemen’s group. “The schedule we came up with was what we thought was the best for our horsemen and for the industry.”

It should take 14 months to build the racino, with construction set to begin in December.

New York state’s newest casino, Resorts World Hudson Valley, will open in about three months in the Newburgh Mall, spreading over a couple of acres where a Bon Ton department store once operated. It will occupy about a quarter of the total mall space.

The $50 million project, which began nine months ago, will have 1,200 slots, including 82 that are unmanned imitations of craps, roulette and blackjack. It will include slots previously used at Monticello Raceway.

It will operate 20 hours a day. The property represents the third Resorts World casino in the state operated by Genting America.

The developer and mall owners hope the 90,000 square-foot casino will help revive the moribund, 40-year-old mall. It is a satellite of the $1 billion Resorts World Catskills casino. Owners hope it will improve revenue for that four-year-old property, whose profits have been disappointing so far. The project was sold as a way to revive the old Borscht Belt that was central to the Catskills for decades.

With a precise opening date not yet set, nearly all the machines are wired with dozens of miles of cable. However, construction is still lagging due to supply chain issues. Nevertheless, it is expected to open by the end of 2022.

A mobile sportsbook powered by Resorts WorldBet will be anchored by a large octagonal bar with eight overhead TVs carrying sports programming.

Meghan Taylor, vice president of government affairs and public relations for Genting Americas, told the Times News-Herald: “What we’re really trying to go for here is more of a locals hangout, almost like a Cheers vibe.” She added, “It’s a convenience play for those that are interested in gaming, but also a really cool and inviting environment for folks to just come and have a drink, relax, catch up with friends.”

The operator has held three job fairs so far and plans to hold others in October. Genting has agreed to pay the city $3 million to host the casino, including $500,000 to supplement the city’s first responders. The city plans to use some of those funds to hire two additional police officers.

The city’s government agencies, including its schools, could also realize a windfall in property taxes resulting from the increased value of the mall.

When it comes to casino competition, however, the Empire State is a target rich environment, with three gaming licenses pending in New York City and reported bids for Queens and Manhattan.

A former New Hampshire lawmaker and Concord businessman, Andy Sanborn, is proposing to build a new, 43,000 square-foot casino and entertainment center on Concord’s east side.

The facility would include 24,000 square feet of gaming with 634 seats, 8,500 square feet of dining and a brewpub with a 150-patron capacity. Sanborn, a former state senator, made a presentation September 22 to the city’s planning board. He promised the city 250 jobs and more charitable contributions, according to the Concord Monitor.

Eventually he wants to add a hotel and an entertainment center. Sanborn is the owner of the Draft Sports Bar & Grill and the Concord Casino. In the Granite State, 35 percent of gross revenue from casinos go back to charity.

Sanborn added, “The way that New Hampshire has established the ability to help us raise money for charitable causes is really, really cool and we are just getting great satisfaction out of doing it.” Sanborn said Thursday. “We are traditional New Hampshire Yankee people who love everything that makes New Hampshire, New Hampshire. We want to pay homage to who we are as a people, and this is a way to aesthetically celebrate that.”

The project designer estimates that the proposed casino “would become the largest fundraiser for local charitable organizations in the county.”

Sanborn said he would increase the number of charities receiving contributions from his properties from 36 to 72. They include such things as Little League, veteran services, domestic violence shelters, homelessness and addiction services.

He said the facility would attract tourists, adding, “People won’t have to go to their local government body for a handout as much because this will truly provide services.”

Sanborn will formally present the plans for phase one, the casino and restaurant in October. Phase two would be the event center, and hotel. He is still looking for a location on the east side of the city.

Board members had some suggestions for Sanborn. One suggested that he use an already developed space, like an existing vacant mall—rather than “virgin” land. In general, though, they liked the proposal.

Wynn Resorts Ltd. and its attorneys are grappling with a new lawsuit that was filed on September 1 in Clark County District Court by a female former Wynn employee who is alleging that the company has continued to foster a hostile work environment for several years after former CEO Steve Wynn reportedly forced her to act as a “sexual servant” for another VIP guest.

Brenna Schrader, a former massage therapist for Wynn Resorts, is represented by attorneys Tracy Eglet, Robert Eglet and Daniele Miller. Wynn has requested that District Court Judge Joanna Kishner dismiss the suit, arguing that Schrader’s claims were already dismissed by Nevada courts in a similar suit from 2019.

A hearing to consider the motion is scheduled for October 25.

The company’s 22-page motion to dismiss reads in part: “Plaintiff’s complaint reasserts a meritless Nevada (Racketeer Influenced and Corrupt Organizations) claim that was already rejected by the U.S. District for the District of Nevada. Rather than seek to amend her complaint or appeal that dismissal, plaintiff refiled … in this court and then apparently sought out the press to garner attention for her latest filing, as if it contained new claims or recent allegations. It does not.”

Schrader’s latest suit includes new allegations from her previous complaint in 2019—the masseuse claims that Steve Wynn “trafficked” her to a high-profile guest, who then sexually assaulted her on multiple occasions from 2016 to 2018. Additionally, Schrader also accused the company of covering up other sexual assault complaints from female employees for over 30 years.

Representatives from Wynn Resorts released the following statement on the new lawsuit: “Wynn Resorts was recently made aware of a lawsuit filed by Ms. Schrader against the company and several former employees. The lawsuit largely mirrors allegations and claims Ms. Schrader made in a prior lawsuit against the company and same former employees more than three years ago, which has been largely dismissed by a federal district court. Given the current status of that prior lawsuit, and the false and outdated allegations contained in the new lawsuit, the company elected to respond immediately by seeking dismissal. Wynn Resorts will defend itself in this and any action that attempts to cast the company today with a light of the past.”

The casino magnate has been embroiled in allegations of sexual misconduct for several years now, even after he resigned and relinquished his gaming licenses in 2018. Wynn has never been charged criminally, and has maintained his innocence from the outset.

Wynn Resorts, on the other hand, has had to face numerous consequences on the mogul’s behalf, including massive fines from regulators in both Nevada and Massachusetts. Since its founder’s departure, the company has “made tremendous strides in reforming the organization through a reconstituted board of directors, refreshed executive team, new human resources policies and training and a world-class corporate governance program.”

New policies for reporting internal incidents as well as increased sexual harassment training have also been implemented.

In Illinois, Hard Rock Casino Rockford officials will host a groundbreaking ceremony at their permanent casino resort located at 7801 E. State Street, near the Interstate 90 exit. An invitation-only event was held previously.

The temporary Rockford Casino, A Hard Rock Opening Act debuted 10 months earlier. Rick Nielsen, guitarist for the rock group Cheap Trick and a Rockford native, will attend the event.

Jon Lucas, chief operating officer at Hard Rock International, said, “Our opening act in Rockford has been fantastic, but I know the entire Rockford community is just as excited as we are for the main show. From the very start, Rockford’s energy has surpassed expectations and it’s no secret they are really ready to rock.”

The facility will include a 65,000-square-foot Hard Rock Casino, Hard Rock Café and 1,600-seat Hard Rock Live venue. A 250-room hotel is planned, but may be built in the second construction phase.

Meanwhile, Hard Rock Casino Rockford announced a partnership with the Coronado Performing Arts Center, including the $100,000 renovation of opera boxes in the balcony. President Geno Iafrate said, “The first time I walked into the Coronado, I was in awe. The rich history, beauty and quality of entertainment at the venue was an instant and natural connection for the Hard Rock.”

In exchange for its sponsorship, Iafrate said Hard Rock will receive a guaranteed block of seats that offer some of the best views of the stage. He said the seats will be used for business relationship purposes and also be given as prizes for members of Hard Rock’s Unity promotional program.

In addition, Hard Rock will receive exclusive use of the recently restored Club 27 hospitality suite, previously used as the owner’s apartment, and rebranded for the year 1927, the year Coronado opened. Hard Rock will use the suite to entertain guests before and after performances. The Rockford Symphony Orchestra and the Friends of the Coronado also will have access to Club 27 to entertain major donors, Iafrate said.