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Opinion: A plan for expanding gaming in N.J.

Senate President Steve Sweeney

By Senate President Steve Sweeney

SINCE 1978, casino gaming in Atlantic City has been an economic generator for all of New Jersey. At its peak, Atlantic City casinos employed more than 40,000 people. As part of the pact to allow gaming in New Jersey, the people made a commitment to assist senior citizens and individuals with disabilities with getting access to prescriptions and other desperate needs. Atlantic City has delivered on its promise; in 2006, gaming revenue reached a height of $5.2 billion.

Since its peak, the market for gaming has changed. Convenience gaming has proliferated throughout the United States with casinos in the backyards of one-time day trippers to Atlantic City. I have been and will remain committed to Atlantic City’s vitality, having worked to create a tourism district to attract non-gamers and to pass legislation to create Internet gaming. But we still see the city struggling to keep casinos open and maintain jobs.

The future of gaming in New Jersey is contingent on being able to adapt to a changing market. For decades, Atlantic City was a world-wide tourist destination based largely on the lure of casino gaming, mixed with beautiful beaches. Times have changed, however, and we can no longer close our eyes to the reality that other markets are luring away dollar after dollar that could be spent right here in New Jersey. Moreover, Superstorm Sandy and the failure of New Jersey to adequately climb out of a deep economic recession have created additional hurdles for Atlantic City. That is why it is time we consider whether to give voters the option of expanding gaming outside of Atlantic City in the near future.

The need to examine expanding gaming does not mean, however, that we are giving up on Atlantic City. In fact, the region has been an important part of our past, and the tens of thousands of people whose livelihoods depend on the gaming industry will not be forgotten.

But Atlantic City is going to have to expand beyond just gaming. For too long, the city relied almost solely on gambling revenues to keep the engine running. That format was bound to run into problems eventually; we have now seen three casinos and possibly a fourth close. We must totally reinvent how Atlantic City bills itself to the world.

To help achieve that change, I am calling for all stakeholders – representative of working people, business and community leaders, elected officials, the governor – to gather within the next 45 days to determine how Atlantic City can best reinvent itself. We have already seen vast improvements in the city: The boardwalk is cleaner and safer and entertainment opportunities are expanding. The new mayor, Don Guardian, is pragmatic and knows the future of Atlantic City will mean more than just gaming. But we have to be prepared for the future.

Key components

As we begin this dialogue, I believe there are several key components that must be discussed before we even bring the question of gaming expansion before the voters. They are:

First, the protection of Atlantic City as the premier gaming destination. Any gaming facility outside Atlantic City must be sited in such a way as to minimize “cannibalization” of Atlantic City and should be constructed as a “convenience gaming” establishment, not a destination resort.

Second, the state has invested a lot in Atlantic City, but Atlantic City has provided a significant return on that investment. That is why a tax rate for gaming outside Atlantic City should be what it is for neighboring states: approximately 50 percent. Of that revenue collected, 50 percent of it needs to go back to Atlantic City in perpetuity to assist in the rejuvenation and stabilization of Atlantic City. Those funds should be administered in an open and transparent way.

Third, jobless casino employees should have the right of first employment at any new gaming facility.

Fourth, current Atlantic City owners and operators who have invested in New Jersey should have the first opportunity to own and/or operate any new facility.

Finally, Atlantic City government, at all levels, must be transformed and restructured in view of its new mission and the changes Atlantic City is experiencing.

I made a commitment to allowing reforms to take shape in Atlantic City. I am standing by that commitment, and I am encouraged by the positive steps Mayor Guardian has taken. But failure to think and look forward will mean getting caught on our heels while jobs and dollars continue to leave the state.

Read the opinion-editorial on The Record’s website.