Nevada Gov. Brian Sandoval’s Gambling Agenda In Australia

By Chris Sieroty

Gambling remains one of the top issues for Nevada Governor Brian Sandoval as he prepares to enter his second week of a trade mission to Australia.

Sandoval’s trade mission also includes talks on mining and water technology, but gambling, and especially an online poker agreement, is being discussed among the trade delegation and government officials.

Bo Bernhard, executive director of UNLV’s International Gaming Institute, is along for the two-week trip with stops in Melbourne, Sydney and Brisbane.

Other members of the Nevada delegation with ties to gaming and tourism include, Claudia Vecchio, director of the state department of Tourism and Cultural Affairs; Alma Derricks, vice president of sales and marketing with Cirque du Soleil; Adrian Matanza, LVCVA’s senior director of community relations and public affairs; and Jack McNeill, senior vice president global government affairs with Scientific Games.

Last year, Australia was Nevada’s 10th largest trading partner with exports totaling $149m.  Gaming equipment accounted for $33m of the state’s export total to Australia.

“Australia’s economic bedrock rests on mining, much like Nevada’s, and tourism and gaming drive economic growth, just as they do in our state,” Sandoval said before arriving on Monday in  Australia.

Additionally, Sandoval said, both Nevada and Australia are looking to lead in water technologies and unmanned systems.

Away from the trade talks, there are already gaming strong business ties between Nevada and Australia.

In 2012, Bally Technologies formed a partnership with Australian gaming company Aristocrat Technologies over online gambling services in the U.S.

Aristocrat expanded further in the U.S. gaming market in 2014 with its $1.3bn purchase of Video Gaming Technologies (VGT). VGT is one of the largest developers and distributors of gaming machines, especially Class II machines for tribal bingo-based gaming.

Sandoval has explored opportunities to expand Nevada’s reach in terms of online poker, signing a modest multistate agreement with Delaware in February 2014.

The governor has said he would consider a multistate agreement with New Jersey and California, should the Golden State legalize online poker. New Jersey offers legal online casino games other than poker.

Chris Sieroty is U.S. Editor with GamblingCompliance in Washington, D.C.


GAMBLINGCOMPLIANCE: Atlantic City Considers Room Tax; Trump Taj Mahal Issues Ultimatum


Atlantic City wants state lawmakers to allow it to charge visitors a $10 fee on hotel rooms to generate some extra money for the cash strapped city, this is as casino workers at Trump Taj Mahal face a Monday deadline to accept a contract offer.

City Council president Marty Small is proposing money generated from the room fee go toward reducing the city’s debt. Small also introduced an ordinance asking the state to allow Atlantic City to charge a wage tax on non-residents working in the city.

Atlantic City has until November 3 to come up with a plan to avoid a full state takeover. Visitors to the struggling community already pay a 9 percent luxury tax on hotel rooms, which generates about $30m annually for state coffers.

“We are just trying to raise as much money for the city’s coffers as we can instead of asking the taxpayers,” Small told GamblingCompliance Thursday. “There’s no question we need the revenue.”

Small said he has not had any discussions with the gaming industry about his resolution. He added that the next step is to send “it to the legislature and see what they do with it.”

As the cash-strapped city looks for ways to balance its budget to prevent a takeover by the state, almost 1,000 unionized casino workers continued their strike Thursday against the Trump Taj Mahal and its owner, billionaire investor Carl Icahn.

Trump Taj Mahal issued a strongly-worded ultimatum to Unite Here Local 54, reminding the union and its members they have until Monday at 5pm (EST) to accept a current contract offer or it will be off the table.

“We want to be very clear — once this offer expires, it is gone,” Tony Rodio, Tropicana’s president and CEO and manager at the Taj Mahal, wrote in a two-page letter to the union.

Rodio said the contract offers Taj Mahal workers restoration of contributions toward an employee health insurance plan.

Restoring health benefits at the Taj Mahal has been a point of frustration for the union for almost two years, after a federal judge allowed the casino to end health and pension payments after filing for bankruptcy in September 2014.

“As the Taj continues to lose millions, a situation obviously made worse by the strike, the company cannot allow its offer to remain outstanding indefinitely,” Rodio wrote.

He also reminded the union and casino workers that “our ownership has invested over $86m in keeping this property alive.”

“This money has kept the doors open, kept the lights on and allowed almost 3,000 union and non-union people to come to work every day,” Rodio wrote.

“The property has burned through all this cash, continues to lose money and continues to need Icahn Enterprises to pump more and more money into this money pit just to keep it going,” Rodio wrote.

Icahn Enterprises also owns Tropicana Atlantic City, one of four Atlantic City properties that reached tentative contracts with the union before July 1.

Local 54 of the Unite Here union said workers from three Caesars Entertainment-owned properties have ratified their new contract. Workers at Harrah’s, Bally’s and Caesars reached a deal before the July 1 deadline.

The union announced late Thursday that 99 percent of unionized Tropicana workers voted to approve the contract.

Bob McDevitt, president of Unite Here Local 54 in Atlantic City, said workers at Taj Mahal want to know why it is alright for Tropicana workers to have health care and not them.

“The company continually holds up the Trop as an example of a property that was doing poorly and is now doing well. At no point did the Tropicana propose eliminating health benefits for its workers,” McDevitt said in a statement.

McDevitt reminded Icahn Enterprises that the Taj Mahal will never be profitable unless it partners with the union.

“Part of the reason that the property continues to do poorly is because of how it has treated its workforce,” McDevitt said.

An argument that was dismissed by Rodio, who blamed union leadership for their handling of the contract negotiations.

“You are striking because your leadership is intent on squeezing blood from a stone,” Rodio wrote. “Although the Taj loses million and millions of dollars, your leadership expects it to provide the same type of benefits provided at profitable properties such as the Borgata. It makes no sense.”

Rodio did not say if the Taj Mahal would close Monday if no deal is reached. In 2014, Atlantic City lost four casinos and 8,000 jobs when The Atlantic Club, Showboat, Revel and Trump Plaza closed their doors leaving eight surviving casinos.

The Taj Mahal has lost money each year since it posted a $20m operating profit in 2013.

Meanwhile, Atlantic City on Wednesday posted lower gaming revenues at the city’s eight brick-and-mortar casino for the second month in a row.

In June, revenues totalled $197.5m, a decline of 3.6 percent from a year ago, according to the New Jersey Department of Gaming Enforcement (DGE). If you include online gambling, June revenues were $213.9m, down 1 percent from a year ago.

Despite the back-to-back monthly declines, casino gaming revenue in Atlantic City is up almost 1 percent for the year-to -date. Through June, casinos have generated more than $1.15bn in gaming revenue, compared with $1.14bn through June 2015.

Internet gaming revenue, meanwhile, is up almost 32 percent for the half-year period to $94.8m.

Rummy Pandit, executive director of the Lloyd Levenson Institute of Gaming, Hospitality and Tourism at Stockton University in Atlantic City, said the year-over-year revenue increase was “a positive.”

Pandit attributed the revenue increase partially to gaming companies investing in non-gaming amenities, including clubs, restaurants and meeting and conference facilities. He said non-gaming revenues have increased in recent years from 20 percent of total revenue to 30 to 35 percent.

“It’s not too late for Atlantic City,” Pandit told GamblingCompliance. “Everything evolves and Atlantic City is evolving.”

GAMBLINGCOMPLIANCE: U.S. Mayors Join AGA Campaign For Legalized Sports Betting


The United States Conference of Mayors (USCM) has voted to join the American Gaming Association’s (AGA) lobbying campaign to legalize and regulate sports betting in the United States, a decision the gaming industry’s largest trade association welcomed enthusiastically.

“We’re pleased that mayors across the country have become the latest stakeholders to support a new approach to sports betting in the United States,” said Sara Rayme, senior vice president of public affairs at the AGA.

“Momentum continues to build for addressing the nearly $150bn illegal sports-betting market that fails to protect the integrity of sports we all love,” Rayme said in an email to GamblingCompliance. “We look forward to working closely with them.”

The USCM held its 84th annual meeting in Indianapolis, Indiana, where the non-partisan organization adopted the resolution titled “Addressing Illegal Sports Betting Through Regulation.”

The resolution says the USCM and the nation’s mayors “believe it’s time for a new approach to sports betting in the United States that could include strict regulation, rigorous consumer protections, taxation of revenues to benefit local communities, and robust tools and resources for law enforcement to root out illegal sports betting and uphold the integrity of the games.”

The USCM, which held its annual meeting June 24-27, also said it will work with the AGA to study the potential benefits of a regulated market. The resolution is not legally binding in any jurisdiction.

Tom Cochran, CEO and executive director of USCM, told GamblingCompliance Wednesday the organization approved the resolution simply because “mayors believe it’s time for a new approach to sports betting.”

Cochran said that new approach includes “strict regulation, rigorous consumer protection, taxation of revenues to benefit cities, and robust tools and resources for law enforcement to root out illegal betting activities.”

In return, the AGA will add the mayors to its stakeholder advisory committee that includes law enforcement agencies, consumers and sports leagues.

“Mayors want to be at the table as any future regulations are being developed; and look forward to working with representatives from the gaming, law enforcement and sports leagues to look at this issue,” Cochran said.

The AGA estimates $149bn was bet on sports illegally in the U.S. last year. In comparison, Nevada reported its legal sports-betting industry posted $4.2bn in handle for 2015.

Sports-betting handle in Nevada declined year-over-year in May. The Nevada Gaming Control Boardreported sportsbooks took in $312.5m in May, compared with $315.8m last year.

Sportsbooks won $5.9m in May, down from almost $20m in May 2015. Analysts attributed the decline to the absence of a marquee boxing match like last year’s championship fight between Floyd Mayweather Jr. and Manny Pacquiao.

Rayme said the AGA has been building a coalition of supporters from the gaming industry, law enforcement, politics, and professional sports leagues to begin lobbying next year for the expansion of legalized sports wagering.

At a day-long Gaming Experts Forum last week in Washington , D.C. attended by reporters, gaming analysts, congressional staff and industry executives, Rayme outlined the AGA’s three-pronged strategy to overturn the federal ban on sports betting — the Professional and Amateur Sports Protection Act of 1992 (PASPA).

She said the AGA’s strategy will define the problem PASPA has created, look for opportunities to overturn PASPA, and build a broad coalition to move any measure through Congress to “get it on the next President’s desk.”

Rayme expected legalized sports betting in the U.S. within the next three to five years.

According to the AGA, any effective approach to legalized sports betting should include strict regulation, rigorous consumer protections, taxes on revenues to benefit local communities, and robust tools for law enforcement.

PASPA prohibits state-sponsored sports betting in all but four states.

Nevada is the only state permitted to offer single-game wagering. The sports lotteries conducted in Delaware, Oregon and Montana are exempt. Also excluded from PASPA are jai alai, and pari-mutuel horse and dog racing.

Congress provided a one-year window of opportunity from the effective date of PASPA on January 1, 1993 for states with licensed casino gaming for the previous ten years to pass law permitting sports wagering.

However, New Jersey failed to pass laws allowing sportsbooks in Atlantic City casinos.

New Jersey has spent nearly four years in court fighting with the NCAA, NFL, NBA, NHL and Major League Baseball to bring legal sports betting to its ailing casinos and racetracks. A decision from theThird Circuit Court of Appeals is expected this summer.

Dan Wallach, a gaming attorney with Becker & Poliakoff in Ft. Lauderdale, Florida, said the country will get to legalized sports betting in a number of ways.

“The American Gaming Association’s campaign is a start,” Wallach said. “The NBA or NFL will lead the charge. But legal challenges will be the one that changes the scene. New Jersey has led the way all on their own.”