Niagara Gazette

Local News

January 13, 2013

Cuomo casino plan is quite a gamble

Niagara Gazette — ALBANY — The success of new upstate New York casinos proposed by Gov. Andrew Cuomo would depend heavily upon them drawing gamblers from other places in an already crowded Northeast market, analysts say.

Cuomo, in his State of the State address Wednesday, proposed that an expansion of gambling in New York begin with up to three casinos upstate, as opposed to the highly lucrative New York City market. Cuomo said there are 39 casinos in adjacent states and Canada, many that draw dollars from downstate gamblers.

"A major challenge for us — and a major opportunity for us — is to get that traffic from New York City to upstate New York," Cuomo said.

New York already has five Indian casinos and nine racinos, which offer video slots but no table games. The Legislature is expected to consider final passage this year of an amendment to the state constitution that would allow up to seven Las Vegas-style casinos beyond Indian land. If approved by lawmakers, voters could make a final decision in November.

Cuomo argues that upstate casinos could be a magnet to downstate gamblers who currently go to casinos in Atlantic City or to Foxwoods Resort Casino and Mohegan Sun casinos in Connecticut. The casinos would help revitalize the upstate economy, he said.

New York would be essentially be "keeping up with the Joneses" by following the lead of its neighbors in a largely saturated market, said Keith Foley, an analyst and senior vice president for Moody's Investors Service. He said the viability of a new casino depends on growing the market and capturing customers from elsewhere.

"You almost have no choice. It's almost foolish not to. But it's going to come at the expense of someone else at this point," Foley said.

While casinos in Pennsylvania and the Resorts World Casino New York City in Queens have done well recently, Foxwoods and Mohegan Sun have been slumping. Numbers out from New Jersey on Thursday show Atlantic City's casinos endured a sixth straight year of plunging revenues in 2012.

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