Greater Atlantic City Chamber President, Joe Kelly, was in Trenton today to testify against gaming expansion beyond Atlantic City. He was joined by several local business members and neighboring Cape May County Chamber of Commerce.
As the leading business voice in the region, The Greater Atlantic City Chamber has a unique role to play in ensuring business retention/development, new employment opportunities are being cultivated and the business community and the public sector are working together to create long term economic stability/growth for Atlantic County.
That being said, there are a number of polices being advanced here in the state that concern our Chamber including increasing the minimum wage to $15, mandatory paid sick leave, and constitutionally dedicated pension payments for Public Employees.
But from our perspective, far worse is the proposal to add more gambling within the state, essentially decimating South Jersey to benefit a few in the northern part of the state. While it's true that Atlantic City has suffered significantly from the growth of gambling in the northeastern U.S., adding more casinos would make the impact on one part of the state disproportionately adverse.
AC has and does contribute to the entire state.
Since 1978, Atlantic City Casinos and Atlantic City have provided the State of New Jersey with significant revenue through taxes on Gross Gaming Revenues, Investment Alternative Taxes Paid to CRDA, as well as corporate income taxes, property taxes, payroll and luxury taxes, and sales and related taxes.
While the industry has contracted in recent years due to gaming competition in neighboring states, the industry still employs almost 25,000 people directly and several thousand more in its vendor businesses. Total salaries and wages amounted to $684 million in 2014. In addition the industry has invested significant capital dollars, employing thousands in the construction trades.
Beneficiaries of Atlantic City Casinos touch all corners of our state, from senior citizens and the disabled to those employed by the industry and their vendors to labor unions across the state's geography from Atlantic City across South Jersey to North Jersey and beyond.
However, with the oversupply of gambling throughout the northeast, Atlantic City has suffered tremendously. Since January 2014, four Atlantic City casinos have closed their doors. The impact of the closure of the Revel, Atlantic Club, Trump Plaza and Showboat facilities have resulted in the loss of 7,700 direct jobs, $240 million in lost wages and over $30 million in tax revenue.
And as you know, Atlantic County leads the nation in property foreclosures, and Atlantic City's ratable base has declined from $20 billion to just over $6 billion.
That brings us to today and ACR1, which is proposing to amend the state constitution to allow the legislature to pass laws to permit the establishment of two casinos in two separate counties in North Jersey. This action creates a sharp divide between the two areas of the state.
Recent studies indicate that the proposed gaming expansion will:
. cause the closing of several more casinos,
. increase the County unemployment rate significantly,
. exacerbate the property foreclosure rate beyond what is currently the highest in the nation and
. create severe economic hardship for our region.
The expansion of gaming beyond Atlantic City could cause the loss of up to 14,550 direct and indirect jobs from the potential closure of an additional two to four casino hotels. Lost direct wages from those closings would amount to $230.9 million, resulting in reduced revenues to the state for wage-related taxes, lost fee-related revenue, potential impairment of publicly traded municipal and state authority debt, and the near doubling of Atlantic County's unemployment rate, which is already twice the state average.
In addition, many national studies indicate that more casinos do not equal more gambling revenue. They pointed to data indicating that growth in gamblers has remained constant over the last 5 years, while growth in gambling facilities has increased 38%. More than half the population in the Northeast now lives within 25 miles of a casino featuring video lotteries, table games or slot machines, up from about 10 percent a decade ago. In 1978, only Las Vegas and Atlantic City had casino gaming. Today 24 states have such facilities, with several other states expected to follow. In fact of the nine eastern states with casino gambling, only New York and Maryland were able to show improvement in 2013 over 2012.
The key issues for the Chamber and the business community from this legislative proposal are substantially more lost jobs, sustaining an already uncertain local investment climate, and a real lack of reliable data and information on what actual benefits would be derived from expanding gaming in North Jersey.
Honest and realistic data (a study) on how much revenue will be generated from casinos in other parts of the state needs to be completed and shared. What resources will flow to Atlantic City, how will it be used, who will receive it; all questions that need to be answered before considering ACR1. What we do know is jobs will be lost and we believe that the revenue from two casinos in North Jersey to Atlantic City will not offset the losses.
The following information was extracted from a recent report titled South Jersey Economic Review by Stockton University William J. Hughes Center for Public Policy (Feb 2016):
Relating to JOBS, Stockton said "Reflecting the precarious state of the local economy, Atlantic City's labor force is in virtual free fall. Between November 2012 and November 2015, the metropolitan area's labor force plunged by 12,780-a startling 9% decline. Only Pine Bluff, AR, whose labor force contracted 12.3% over the same period, saw a greater percentage decline. Remarkably, the absolute decline in Atlantic City's labor force was the fifth largest among all metropolitan areas in the U.S. during this period. "
And on HOUSING, Stockton Hughes Center said "The dire state of the local economy and the apparent out-migration now occurring continue to be reflected in the local housing market. Foreclosure data from RealtyTrac indicate that 1 in every 261 residential properties in Atlantic County was in some stage (pre-foreclosure, auction or bank owned) of active foreclosure in December. This compares to 1 in every 553 properties statewide, and 1 in every 1,278 nationally."
In closing, the Chamber has long been opposed to the expansion of gaming outside Atlantic City as should be our members, all South Jersey residents and all businesses.
Responsible elected officials must oppose this legislation and protect the region's economic future. Policy makers need to make sound policy decisions.
Joe Kelly, President
Greater Atlantic City Chamber
12 South Virginia Avenue
Atlantic City, NJ