bum’s Rush needed

. . “get dose bums outta here!” . . 

 And, so it begins: “Rivers, Del Lago casinos ask state for better terms: All four non-Indian casinos in state are missing their financial targets” (Schenectady Daily Gazette, by John CropleyMarch 28, 2018):

 Little more than a year since their grand openings, two of New York’s four non-Indian casinos are asking the state for financial help.

Rivers Casino & Resort in Schenectady and Del Lago Resort and Casino in Seneca County are both making their cases with state lawmakers as the negotiations for the 2018-2019 state budget wind down to the final hours in Albany.

Details on their requests are elusive and, given the secretive nature of deal-making in the Capitol, quite possibly subject to change or outright rejection.

. . . Details were likewise hazy on the request by Rivers.

 A New Jersey public relations agency working for Rivers said there would be no comment on the matter.

A lobbyist reportedly working for the casinos did not return a call seeking comment.

. . . However, Assemblyman Phil Steck, D-Colonie, whose district contains Rivers Casino & Resort, said he has been given a rough idea of what Rivers is requesting, and said he endorses it.

Trying to save Schenectady’s Lady Liberty from pols and pirates is monopolizing my time again today, so I can’t go into detail about taxpayers getting the Bum’s Rush from Rush Street, but it probably makes more sense to see what, if anything, is done with their request. [see update below: Cuomo won’t play]

Here is what I said in a comment at the Gazette article:

 On July 14, 2014, we asked at the “Stop the Schenectady Casino” weblog: “How big of a gamble are the casino cheerleaders willing to take?. . . Does the shiny future they predict for Schenectady include the sight of a failing casino project along Schenectady’s riverfront and the inevitable request for tax breaks and financial assistance that we can expect once gaming revenues shrink along the Mohawk? [see https://tinyurl.com/unpromisingCasino ]

When Rivers hired Rob Long as its new General Manager last December, we also noted that Long had guided the development and opening of Rush Street’s very first casino, Riverwalk in Vicksburg, Mississippi. Rush Street sold that Casino in 2012, just four years after it opened, and after failing in their request for a 60% reduction in their property tax assessment. Have Rush Street and Galesi Group drawn up their tax assessment challenges yet? Are they looking for a buyer? What will Mr. Steck do for them next?

In addition to checking out https://tinyurl.com/unpromisingCasino, see “casino projections vs. casino reality” and links therein. Stay tuned, and watch out for those pick-pockets and Rushing Bums.

red check update (4 PM, March 28, 2018):  See “Cuomo says he is not interested in bailing out casinos” (State Of Politics. March 28, 2918). Article also has letter from State Senator Micheal Ranzenhofer, wanting help for existing casinos hurt by creating del Lago Casino, not for del Lago.

[8PM update] See “Cuomo: No bailout for Rivers, del Lago casinos” (Gazette, John Cropley, March 28, 2018).

There are many others in this state that aren’t getting what they need and that deserve more money from the state — many others in severe need through no fault of their own.

The casinos don’t fall into that category, and state lawmakers shouldn’t cave in to their appeals.

  • TUJBoyerTaxGamble update (March 30, 2018): The Times Union editorial board weighed in this morning with “Editorial: Say no to casino subsidies“, including a nifty illustration by Jeff Boyer [click on the thumbnail to the left]. It notes which of our representatives are for and against such handouts, and concludes:

All the signs were there years ago that the casino expectations and promises, especially upstate, were overblown. Now that those warnings are proving true, these enterprises seem to hope New York will behave like a classic loser who digs deeper into his pockets in the hope of a winning hand. There’s a gambling term state leaders would do well to learn: Pass.

Rivers anniversary hoopla yields so-so results

front page Gazette ad

 You have probably seen or heard the newspaper and digital advertising blitz and all the media coverage the past couple of weeks for the 1st Anniversary of Rivers Casino at Mohawk Harbor in Schenectady. [click on image to the right for a sample] The Anniversary occurred on February 8, and is being celebrated at the Casino throughout February, with drawings for free cars, special entertainment, and more. Yesterday afternoon (Friday, Feb. 16), I checked the NYS Gaming Commission website to see if promotions for last week’s big Anniversary-cum-weekend have meant better gaming revenues for Rivers for the week ending February 11. After its disappointing shortfall from projected GRR in its first full year, the ability to create some Anniversary excitement might suggest whether our municipal leaders are correct about the coming of a better year.

 The total Gross Gaming Revenue for the week ending last Sunday was $3,232,728. That makes Anniversary Week the 5th best week since the opening of Rivers Casino. Naturally, its owner-management, Rush Street Gaming, will say they are delighted with that figure, even after considering all the promotional and entertainment expenses. To me, the results seem rather “so-so” [“mezza mezza”] as Celebrations of a treasured community asset go. Underwhelming. [update (Feb. 23, 2018): GGR for the next Anniversary week, ending 02/18/2018, went down slightly, amounting to $3,221,484, making it Rivers’ 6th best week in Schenectady.]

To put a $3.2 million Anniversary Week into perspective:

  • Averaging $3.2 million over all 52 weeks would yield $168 million total GGR for the year.
  • $168 million is only 83% of the $201.9 million Rivers Casino projected as its base first-year estimate for GGR. (see “Casino bets are off the mark”, Albany Times Union, by Lauren Stanforth).
  • $3.2 million is $600,000 less that the Casino’s best week ($3,882,454) which ended on July 16, 2017. [It would take 52 $3.88 million weeks to achieve the base year projection of approximately $202 million.]

 Was It the Weather? Rush Street Gaming can’t blame weather for its Anniversary Week results. It was a normal-moderate Schenectady early February week, with one snowfall of 7 inches starting on February 7, but streets cleared by early on the 8th, and moderate weather through the weekend.

 Meanwhile, how did the new competition in the Catskills — Resorts World Catskill in Monticello,  NY — do in its “soft” opening week? RWCatskills had an early, soft opening on February 8, to prepare for this weekend’s celebration of Chinese New Year, with its hopeful influx of high-rollers from the other Far East. According it its NYS Gaming Commission Financial Report: the total for its 4-day first week was $3,403,955. Over its first 53 weeks, Rivers Casino in Schenectady has had only 4 weeks better than RWCatskills’ first, four-day week.

  • We will report back at the end of next week on RWCatskills’ second week, which will include three days of the Chinese New Year celebration. [see next bullet note]
  • RWCatskillsChineseNY update re Chinese New Year (Feb. 23, 2018): Resorts World Catskills has announced that it will hold its Chinese New Year Celebration on September 25, 2018.  Its press release describes aspects of the Celebration, and also its attempts to serve the Asian gaming market, as well as the multi-cultural communities in New York City (with many bus lines offering service to the Catskills Casino from NYC locations).  More information is available on the RWCatskills Facebook Page.

.  If you’d like to see why many observers say that the new Catskills Casino has a “wow factor”, including a 19-story hotel that serves as a palette that reflects its changing surroundings, that sets it apart from Schenectady’s casino, check out RecordOnline.com’s “Exclusive behind the scenes video tour of Resorts World Catskills” (Feb. 6, 2018, 8 min.).

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Rivers Casino Visitation is another shortfall on the Mohawk

67%red update (Feb. 5, 2018): The Schenectady Gazette reports this evening that Rivers Casino has released a set of statistics for its operations in 2017 at Mohawk Harbor. Included was the statement that “More than 1.5 million patrons entered the casino” in 2017. See “Rivers Casino counted more than 1.5 million guests in year one” (by John Cropley, online, Feb. 5, 2018). The article notes that:

“A 2014 consultant’s report prepared in support of the casino’s license application projected 2.5 million to 3 million patron visits per year. That would come once the casino achieved “stabilized operations,” the report stipulated, presumably not in its first year.”

RiversProjections Since the Gazette did not put the 1st vs. Stabilized Year projection into context, and by implication downplayed the shortfall, we will add context.  The projection of 2.5 million to 3.0 million visits in its first “stabilized” year was for 2019.  Rush Street consistently projected its first-stabilized-year numbers in its Application by adding 10% to its projections for 2017 (or vis versa) [For example, click on the image to the right, showing Rivers projections for gross gaming revenues, food and beverage sales, and hotel revenues. That 2014 submission to the Location Board can be found in full here.]

The Casino’s middle or base case projection for 2019 was 2.75 million patron visits.  Therefore, if 2017 had been a full year, the projection would be 2.5 million visits in 2017. Because 2017 ended up being only 47 weeks of operation (90% of 52 weeks), we should subtract another ten percent for a fair comparison to actual 2017 operations: That makes a 2017 base case (middle) projection of 2.25 million visits.

67%purple One and a half million patron visits to the Rivers Casino is therefore, only 67% of the number projected by Rush Street Gaming. It is easy to understand why a Casino Applicant wants to project as large a number of gaming and tourist visits as possible. As explained, below, the number of visitors attracted to Rivers Casino has important implications for gambling revenues generated, and also for the sales, food and beverage taxes, and hotel occupancy fees, paid at the Casino compound. But, also greatly impacts the promised “ripple” effect, if any, on the rest of the City and County’s businesses and attractions, as well as the feared “substitution/cannibalization effect”, whereby local leisure spending goes to Mohawk Harbor and the Casino, and not to other businesses.

BTW: Rivers Casino operated about 330 days in 2017. The 1.5 million patrons figures means that the average daily patron visitation at River Casino was about 4600. Of course, not all came to gamble, and some entered more than once a day, increasing the total.

treasurehunter Naturally, there are many questions about the 1.5 million number (beyond  how it was compiled), including how many were day-trippers, who are more likely to spend their entire Schenectady visit within the Casino or perhaps Mohawk Harbor, rather than spending time and money elsewhere. The Gazette notes that neither the state nor county will quantify sales tax and hotel occupancy tax revenue generated by the Casino, “out of consideration for the business strategies of those collecting.” That suggests that the  media needs to do some digging — beyond the self-congratulatory fog to be expected from the Chamber and Metroplex — to see how businesses outside of Mohawk Harbor are faring.

original posting

“Rivers Casino is estimated to attract more than 2.5 million visits to Schenectady and the downtown area, as discussed in the Gaming Market Assessment (Exhibit VIII.A.3.). This substantial visitor volume is expected to benefit local businesses, as has been experienced in numerous gaming jurisdictions across the country.” [at 29]

“As discussed in the Gaming Market Assessment (Exhibit VIII.A.3.), gaming visitation at the Rivers Casino is estimated to range from 2.5 million (Low Case) to 3.0 million (High Case).” [at 36]

. . . Rush Street Gaming, Economic Impact Analysis, June 2014

 When it applied to the NYS Gaming Commission Location Board in 2014, hoping to eventually operate Rives Casino in Schenectady, Rush Street Gaming estimated that the Casino would attract about 2.8 million “gaming visitations” in 2019, its first stabilized year of operation.  See Economic and Community Impact Analysis, Rivers Casino and Resort at Mohawk Harbor: Schenectady, New York (prepared for Rush Street Gaming, LLC, by The Innovation Group (June 12, 2014), at 7; see quotations above. [Note: the figures given by Rush Street for its 1st stabilized year were only 10% higher than it used for its first year of operations projections, not the amazing increases wistfully suggested by City Hall when asked about the disappointing 2017 numbers.]

As Rush Street’s Impact Analysis suggests, the number of visitors attracted has important implications for much more than gambling revenues generated. Of course, the sales, food and beverage taxes, and hotel occupancy fees, paid at the Casino compound, are directly connected to the number of day-trip and overnight visitors. But, so is the “ripple” effect, if any, on the rest of the City and County’s businesses, and the feared “substitution effect”, if local leisure spending goes to Mohawk Harbor and the Casino, and not to other businesses.  This website and its proprietor have been asking local media outlets to look into the Casino and Tourist Visits Issue for several months. To date, we have seen no media analysis of the issue. And, we have had no response from the Racing Commission to our request for gaming visitation statistics.

Today, Sunday Gazette reporter John Cropley has two articles looking at the first year of operation of Rivers Casino. “Rivers Casino raking in cash, but where’s tax cut?” and “Casinos’ impact on state still up for debate” (Schenectady Daily Gazette, February 4, 2018). The “Casinos’ Impact” article has only a momentary, and somewhat misleading, mention of tourist projections by Rivers Casino. In a list of projections given by Rush Street in its 2014 application, the article includes:

  • Projected 80,000 tourist visitors per year.

Rivers Casino did not bother to respond to the Gazette as to its various projections, so we do not know whether it believes it hit that 80K figure. In 2014, the 80,000 tourist visitors projection was, it appears, used in explaining the viability of a casino hotel. The 2.5 to 3.0 million “casino visitation” figure is the far more significant number when attempting to gauge the overall direct and indirect effects of the casino on the community.

  • A Casino Visitation is a trip to the casino by an individual, whether or not for gambling. As you can see in the two quotes at the top of this posting, Rush Street blurred the notion of casino visits and visits to Schenectady and its downtown. Overnight visitors/tourists to Mohawk Harbor seem more likely than day-trippers to make it out of the compound and head downtown, but even that is not a certainty. Eighty thousand is only about 3% of 2.5 million.
    • SpendLess To understand factors influencing Casino Visitation, see “Consumer Behavior in the Gaming Industry” (Dec. 2014), by The Innovation Group, which had produced Rush Street’s Economic Impact Analysis for its a Schenectady Casino application 6 months earlier, projecting the 2.8 million range. In this study, the generations were broken down into four groups: Millennials, GenX, Baby Boomers, and Matures. Among the findings:
    • “Ultimately, the trends we are seeing show a waning visitation and spend for older generations, which currently generate the majority of gaming revenue. Younger generations tend to be increasing casino visitation, but are not necessarily attending for gaming purposes.” [at 11]

    • “Proportionately, Millennials and GenX spent less than 60% of their day trip budget on gambling, while older generations spent over 75% of their day trip budget on gaming. Throughout the survey it was abundantly clear that the younger generations not only spend far more on non-gaming amenities than the older generations, but it was the non-gaming amenities that attracted them most to the casino.” [at 6] Thus, “More than half of Millennials mentioned they had visited the casino and did not gamble, comparing to only 15% of Matures who made that same indication.” [at 7] And, “the amenities that motivated the younger generations were much different and focused more on the following: • Nightlife; • Live entertainment; • Variety of table games; • Spa facilities; • Shopping; • Family attractions; • Number of bars & lounges; and • Free or comped alcohol.”

Don’t these findings suggest that actions a casino makes to attract younger consumers may help its bottom-line without a proportionate increase in the gambling revenue taxes communities were counting on?

The Gazette article does not speak of the “SubstitutionEffect” directly, but the notion was implicit in a statement that State Comptroller Thomas DiNapoli emailed to The Daily Gazette on Friday:

 “The new casinos may have some near-term positive impacts, including creating some new jobs. However, those gains can be expected to be offset by losses elsewhere, as people spend money in new casinos rather than in existing gambling venues or on other consumer purchases. The impact of the new casinos on New York’s economy remains to be determined.”

With the Schenectady County Tourism Bureau, the regional Chamber of Commerce,  and our Metroplex leadership focusing so much on helping Mohawk Harbor and the Casino, we need the press and broadcast media to ask just how the rest of our businesses are doing. City Hall did not do its Homework on the Substitution Effect Issue. The “Downtown leaders” most vocally in support of the Casino Application ended up being partnered up with Galesi and Rush Street, and surely can count on financial benefits from the operation of Rivers Casino. What about the rest of our businesses and business centers? For example, we need to see how sales taxes, food and beverage, and room occupancy receipts, did net of activity at he casino compound. And, ask what sales taxes would have looked like without the spike in one-time construction materials for Mohawk Harbor. As the Times Union has consistently done, the new leadership at the Schenectady Daily Gazette must do some digging and true investigative reporting, if our community is ever to know the true costs and benefits of the Rivers Casino. The Gazette needs to be focused on the Community’s needs, not the Casino’s needs.

  • This posting will be augmented as we learn more about the actual size of “gaming visitation” in 2017 at Rivers Casino at Mohawk Harbor in Schenectady, and the number of “tourist visits” the Casino has attracted. Rivers Casino touted its vistor numbers its first day or two in operation, but has not mentioned gaming visitation or tourist visit numbers since then.

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p.s.

The people of Hamilton Ontario [CA] successfully fought a downtown casino. Here are two samples of their graphics and posters: relating to the Cannibalization or Substitution Effects:

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the graph is prettier than the casino revenue numbers

A helpful friend used the weekly Rivers Casino at Mohawk Harbor gambling revenue figures from the NYS Gaming Commission, plus Exel software, to create the above graph. The only patterns I can see are long periods of mediocre revenues. There certainly was no noticeable improvement when The Landing Hotel opened on July 23, 2017.

Casino Projections vs. Casino Reality

 

RiversProjectionGame2

 Year-end numbers are in for 2017, and the City of Schenectady has received approximately $2.1 million in gaming tax revenue as the Host City of Rivers Casino at Mohawk Harbor, based on the Casino’s Gross Gaming Revenue total of $129.2 million for the year. The County received the same amount. In its budget, the City had projected it would receive $2.75 million from distribution of gaming taxes in 2017, leaving a shortfall over $600,000. See “Schenectady loses bet on casino revenue” (Times Union, by Paul Nelson, Jan. 4, 2018). As the Gazette pointed out last November, “Rivers reportedly projected its first-year [Gross Gaming] revenue to be in the $181 million to $222 million range.” If we take the middle of that range, $201 million in GGR in its first year, Rivers Casino only achieved 64% of its first year projection.

  • Click here to see Rush Street’s 5-year tax revenue estimates, submitted in its Application to the Gaming Commission Location Board as Ex. VIII.B.4. It shows a base GGR for 2017 of $201.8 million. Its high and low figures were obtained by respectively adding and subtracting 10% to that figure, yielding the range given in the Gazette of $181-222 million. Because Rush Street anticipated opening on Jan. 1, 2017 when making this estimate, it used a 52-week period rather than the actual 47 weeks, which meant 10% fewer operating weeks/days.
  •  Note: In Ex. VIII.B., filed at the end of July 2014, Rush Street Gaming estimated that the County and City would together receive a total of $3.2 million in gaming tax revenues in Year One, increasing to only $3.6 million collectively in Year Five, and would share those amounts.  Those numbers are very different from the $5.7 million in annual tax receipts City Council said it expected in its resolution the month before.  I would have thought the communication between City Hall and the Casino Gang was better than that.

 In what is surely a causally related effect, Mayor Gary McCarthy stated for the first time, in his New Year address before City Council last week, that he expected the City would have a “small deficit” when all 2017 numbers were tallied for the City, giving no further details of the cause or the likely amount. Asked afterwards, new City Council President Ed Kosiur said the Mayor’s remarks were the first he heard of a deficit. See “Schenectady Casino Revenue Coming Up Short of Expectations” (Samantha Beckett, Casino.org, Jan. 5, 2018). Regarding the Upstate casino shortfall in general, see “He nailed it: An analyst’s 2014 report predicted Upstate New York casino woes” NYUp.com, by Don Cazentre, Jan. 18, 2018).

 Click on the image to the left to see a week-by-week display of Gaming Revenues generated at Rivers Casino in 2017, plus totals.

The Stabilization Hope. Our City and County leaders keeping saying we can expect much better results once the casino’s operations and revenues have stabilized — as if Rush Street and its expert analysts are not competent to make first-year projections. But, in its Application to the Location Board, Rush Street Gaming estimated stabilized revenues in Year 5 to be only 10% more than its Year 1 figures. For more information on Rush Street’s revenue and tax projections, see the Applicants’ Economic Impact Analysis.

 Remembering the 18% property tax reduction City Council claimed it expected in a Resolution passed just before its vote to approve the Casino Application in July 2014, many residents are unhappy with the 1% reduction in the current City budget, and many are “roiled” over the water and sewer fee increases announced this week, which will offset the 1% reduction. See “State, local promises before casino vote a bust” (Times Union, by Lauren Stanforth, December 17, 2017); “Water, sewer rate increases roil some Schenectady residents” (Times Union, by Paul Nelson, Jan. 5, 2018).

 Are things likely to get better? Despite their Happy Faces, the City Council budgeted only $2.3 million in casino tax payments in 2018. Furthermore, Rush Street, City Hall and Metroplex have all pointed out for months that revenues are likely to rise due to the opening of Rivers Casino’s Landing Hotel, which had its first guests on July 19, 2017. (e.g., Times Union coverage; Gazette coverage) The week ending July 30 was the first full week with the Landing open. Despite the predictions of our Casino Cheerleaders, my calculations show that:

  • $2.7 million/wk. average for the 24 full weeks before before July 23
  • $2.6 million/wk. average for the 23 full weeks since the Landing opened

And, did you say “Resorts World Catskills Casino”?

Continue reading

TU compares revenue reality to casino projections

Lauren Stanforth has written a piece of investigatory journalism for the Albany Times Union, published yesterday at the top of the Sunday front page, on the dramatic shortfall of casino revenues from projections. See “State, local promises before casino vote a bust” (December 17, 2017). It points out that only the Schenectady City Council put actual projection numbers in a resolution, with a stated expectation of $5.7 million in annual tax gaming tax revenues for the City, and an 18% property tax reduction.
 .
 The City Council used NYS Dept. of Budget numbers for Regions, Counties, and Host Communities that were produced in 2013, announced in a press release (Oct. 2, 2013), to garner support for the Governor’s Constitutional Amendment Proposition, to permit non-Indian casinos. The numbers were, therefore, ginned up when the State did not know how many casinos there might actually be, nor where they would be located.
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The Resolution stated, in part [emphases added]:
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WHEREAS, as Host Municipality, the City of Schenectady is entitled to receive 5% of the gaming taxes paid by the Gaming Facility which is projected by the NYS Division of the Budget to be $5.7 million dollars annually; and
 .
WHEREAS, a $5.7 million Host Municipality payment to the City of Schenectady would result in a reduction in real estate taxes of approximately 18%; . . . 
 .
NOW, THEREFORE, BE IT
RESOLVED, that the Host Municipality payment received by the City of Schenectady will be used exclusively for the reduction of real property taxes in the City of Schenectady.
 .
  • At the time, we said at this website [in “Council ploy: all casino revenues will be used to reduce property taxes“, June 9, 2014] that “Th[e] Resolution is clearly meant to back the possible No Votes [on support for the Schenectady casino application] into a corner, by daring them to vote ‘no’ on a ‘tax reduction’.” In that context, using specific and huge numbers that appeared to come with the imprimatur of the State Budget office clearly strengthened the Mayor’s demand for Yes votes and the support in the very tax-conscious community for the casino. The Mayor was not able to convince Marion Porterfield and Vince Riggi to vote for the Casino application, but they did agree that any tax revenues from the casino should be used to bring down real property taxes in Schenectady.
  •  At no time did City Council or the Mayor explain the tenuous connection between the DOB projections and an actual casino located in Schenectady, as opposed to a municipality with a greater potential to attract the public.
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The TU article notes that the State’s 2013 projections estimated that the Host County in the Capital Region would receive about $11.4 million dollars annually (with the Host City getting half of that amount), but that the actual numbers for this year appear to be about $3.7 million, a shortfall of $7.6 million. It also stresses, regarding the Schenectady Casino situation:
 .
“A casino was expected to bring in so much revenue — and the local government share to go along with it — that Schenectady would reduce property taxes 18 percent in the first year. Now, 10 months after the opening of Rivers Casino and Resort, the city is reducing taxes 1 percent.
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“Schenectady County predicted a similar scenario, its legislature passing a resolution three years ago saying county taxes might be reduced 8 percent if a casino opened. County officials are now reducing taxes 1 percent.”
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Reporter Stanforth interviewed local politicians, and informed us:
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Schenectady officials say their tax reduction promises were not disingenuous because they based their statements on the Budget Division’s numbers — and that property taxes are still being reduced.
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 But those who argued against a casino say the disparity between what was promised and the current reality reinforces their concerns that local officials had no intention of looking critically at information provided by the state or casino operators themselves.
 .
“They did it in bad faith,” said Schenectady resident David Giacalone, who lives in the city’s historic Stockade neighborhood and was one of the most vocal critics opposing a casino. “They knew these numbers meant nothing.”
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Catskills casino coming in 2018

County Legislature Chair Gary Hughes pointed out that the NYS Gaming Commission believes casino revenues will grow in coming years, but he added, “Is it someday going to be $5.7 million? I have my doubts.” I wonder if Mr. Hughes has considered, as the TU stated, that “revenue from the Resorts World Catskills [casino in Monticello] will likely top Rivers, as it will have almost twice as many slot machines and an 18-story hotel when it opens in March, as well as a golf course opening in 2019″. Indeed, about a billion dollars will be invested in the Catskills casino project, yielding a location that will actually look like a tourist destination. 

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Perhaps City Council President Leeza Perazzo is giving up her hopes of being Mayor. She was remarkably frank with the reporter:
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Schenectady City Council President Democrat Leesa Perazzo, who voted to support a casino, said the city included the revenue number in its June 2014 vote because the state provided it.
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The resolution also said that the host municipality payment, “will be used exclusively for the reduction of real property taxes.” However, city officials have already used casino revenue in settling fire and police contracts.
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Perazzo said a resolution is not a law, so city officials are not bound by the tax reduction promises made in it.
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Sadly, our City Hall has given us a Social Studies and Political Science lesson for the ages here in Schenectady. I wonder if this TU article has given the Gazette any ideas about doing a little casino-related investigation of its own. Perhaps a spotlight on the Applicants’ projection of 2.8 million visitors coming annually to Schenectady because of Rivers Casino needs a bit of investigation. More significantly, perhaps looking into the ways the Planning Commission and Board of Zoning Appeals have twisted (diminished? castrated?) our Zoning Code to please the Galesi Group and Rush Street Gaming might be more important in the long run.
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Luck Ain’t No Lady: 38th week the worst yet at Rivers Casino

LUCKNOLADYhonest  According to the NYS Racing Commission revenues page for Rivers Casino, its 38th week (ending October 29, 2017), was the WORST week yet for the Schenectady Mohawk Harbor Casino. That’s despite having the Ellis Foundation’s big Women’s Night Out “Luck Be a Lady” event there on October 26, preceded by a prep-day of Table Game education in September. Of course, we can only guess the effect of several weeks of Mayor Gary McCarthy appearing in ubiquitous (and, for many of us, tacky and dispiriting) Fuccillo Auto ads shot at the Casino. Nonetheless, last week’s, take, $2,039,456, was perilously close to dipping below the $2-million mark. 

plungegraphsmY DOLLARS. This comes after Gazette columnist Sara Foss called this week for a review of the inflated revenue projections we got from the three new casinos in New York State. While this site was temporarily called “Stop the Schenectady Casino”, we pointed out the practice of over-promising revenues. That included, as even the Gazette reported prior to endorsing the Casino, that “In Philadelphia, for example, SugarHouse was projected to generate $320 million in gross revenue its first year but only generated $212 million.” 

casinowalkers BODIES. We hope that Foss or another journalist will look into the promises Rush Street made about how many people the Casino would bring to Schenectady. It projected 2.8 million a year. The fact that we have never been given any attendance numbers past the first couple of days suggests that the projected body-count was another cynical exaggeration. 

 

red check For those readers who are wondering how, after the Gazette endorsement of Porterfield, Farley and Mootooveren for City Council, to choose between John Mootooveren and Mohamed Hafez when using their third vote, I’d like to point out the following, regarding each man and the Casino:

Incumbent Councilman John Mootooveren:

  • JMootooverenHas acted as if Schenectady were a Supplicant, and a Second-Rate City, during the casino license application process, and thereafter, rubber-stamping the Mayor’s Supine Schenectady position, giving the Casino applicants their every wish, while making no demands. In contrast, all other potential casino locations use their leverage, to assure additional income from the casino, including mitigating its added expenses for infrastructure, public safety, and social problems; seeking guarantees of minimum revenue payments; and demanding local preference for jobs, and a buffer period in which property assessments would not be challenged by the developer.
  • Never questioned any claim made by the Casino applicants prior to voting to approve their Application for a Casino License in Schenectady as to projected revenue and the absence of likely negative effects.
  • Never sought an independent study of potential negative effects and realistic benefits, despite his claims of financial expertise.
  • And, never questioned or challenged any of the drastic changes in our zoning ordinance, demanded by Rush Street Gaming and the Galesi Group. As a result, the Council and the Mayor took away the guarantee of public access in perpetuity to enjoyment of the riverbank when the harbor was developed, and the requirement that 10% of residential boat dock space be reserved during the day for the public.

In contrast, Candidate Mohamed Hafez:

  • MHafez Was a leader in the Stop the Schenectady Casino campaign, pointing out the many problems raised by locating a casino in an urban area and the need to fully consider likely problems and realistic benefits.
  • Demanded over and over, at City Council meetings, and in writing to the press, that the City use its leverage to demand/negotiate the best possible agreement with the Casino to maximize revenues and local employment, and minimize and offset added financial and social costs.
  • Wrote a letter to the editor we reprised here: “wise words from Mr. Hafez“; and
  • Asked the Mayor directly about host community agreements at a City Council meeting on May 11th, and at subsequent meetings, leading to the Mayor writing a guest column in the Gazette debunking the notion of having an HCA or needing to ask for any moneys in addition to required taxes, and our responding at length at this website. E.g., “the Lago Casino HCA and the Mayor.”

Empty Chair. One final note about the two candidates: Mohamed Hafez, a registered Democrat running on the Republican and IndependenceParty lines, attended every candidate forum during the current City Council election campaign. John Mootooveren, the incumbent Democrat who is 1/4th of the Mayor’s 4-person rubberstamp majority on the Council, failed to appear at the League of Women Voters forum, the Gazette Candidate forum at Proctors, the Woodlawn neighborhood association forum, and the Goose Hill Neighborhood Association meet the candidates event.

despite Billy Fuccillo, no HUGE casino revenues yet

 

 

. . above: Billy Fuccillo & Schenectady Mayor Gary McCarthy in a Fuccillo Automotive Group tv ad from the Rivers Casino, and Gary and Billy saying “H-u-u-ge!” . . 

September should have been a huge month for revenues at the Schenectady Rivers Casino, due to all the developments, hoopla and free press all summer, and a big push from extra-huge car salesman Billy Fuccillo since late August. The revenue stream should have been surging all September, given:

  • the mid-July opening of the Casino’s Landing Hotel (first guests arrived July 19), with lots of publicity for the Grand Opening, including the Vegas-style magical illusions of Steve Wyrick
  • arrival of the first “live-and-play here” tenants at River House
  • Billy Fuccillo getting the Keys to the City on July 20, and about a month later starting a series of ubiquitous tv ads, and related promotions, located at Rivers Casino and its The Landing hotel
  • the end of the Saratoga Racing season and any resultant loss of casino gambling in Schenectady
  • a sold-out first boxing event on September 23rd
  • the insistence of Rush Street officials and local political leaders that all of the above would result in greater revenues after the summer doldrums. See, e.g. the Times Union article “Schenectady still hopeful casino will pay off” (by Paul Nelson, Sept. 24, 2017)

 Nonetheless, despite that confluence of reasons to expect a great September, revenues declined all month — four weeks in a row, according to the Gross Gaming Revenues statement submitted yesterday (Oct. 7) to the NYS Racing Commission by Rivers Casino. [click on image to the right]

The actual revenue numbers did not prevent (or maybe they inspired) most candidates for the three contested seats on the Schenectady City Council to remind Gazette Forum audience that it takes three years for a casino’s revenues to stabilize and to make projections more accurate. [They do not say whether industry experience suggests the trend is for a higher or lower level of revenue stabilization after three years.]

 If you haven’t done so already, please see the two Times Union Sunday articles on disappointing casino revenues, published on September 24, 2017: Lauren Stanforth’s “Some bets are off at New York casinos: State’s three new gaming centers millions of dollars behind their first-year revenue projections”; and Paul Nelson’s local focus article (referred to above).

 Of course, David Giacalone, his friends and like-minded folk are not the likely targets of Rivers Casino promotions and ads. Nonetheless, I have to wonder how the Rush Street folks could think that opening their tv onslaught early this year with a Russian-mob impersonator, and now counting on Billy Fuccillo (who I have grown to value over the decades for his auto ads, but not for lifestyle advice) to broaden their appeal. Adding the un-telegenic presence of Hizzonner Gary McCarthy also seems unlikely to help turn Rivers Casino at Mohawk Harbor into a regional (much less national) tourist destination.

. . share with this tiny url: http://tinyurl.com/NoHugeRevenues

  •  Food For Thought (Regrets Category):  Have you noticed how much money nearby counties are getting without having to deal with the problems of having an urban casino in their midst? Or having the fear of their casino failing, or the embarrassment of their politicians bending over backwards to please the Casino or find misleading reasons for optimism? Those of us who thought the risks of an urban casino were too great to warrant gambling that a Schenectady casino would yield the promised revenues would be pleased to merely take the trickle-down payments given to nearby counties.

     Thus, even with the disappointing revenues to date, Rensselaer County had already received $403,750 by the end of July — approximately what Schenectady County would have received already, since it has a very similar population. And, if the Casino had gone to the much more deserving Howe’s Caverns applicant in Schoharie County, Schenectady would have been the closest significant source of employees, and the State would have a commercial casino sans the extra risks that urban casinos bring.  Here’s a look (from the August 21, 2017 Gazette) at how much Rivers Casino has meant to local municipalities from its state gaming tax dollars through July, according to state Gaming Commission numbers:

    • Education: $17.9 million
    • City of Schenectady: $1.1 million
    • Schenectady County: $1.1 million
    • Albany County: $770,388
    • Fulton County: $140,630
    • Montgomery County: $127,178
    • Rensselaer County: $403,750
    • Saratoga County: $556,148
    • Schoharie County: $82,936
    • Washington County: $160,092

Gazette covers half-year Casino revenues

Today’s Schenectady Daily Gazette has an informative article headlined “A look at Rivers Casino’s gaming numbers 6 months after opening” (by Brett Samuels, August 21, 2017). It includes a “look at how much Rivers Casino has paid out to local municipalities in state gaming tax through July.” For Casino Realists like myself, here’s the core of the article:

 If business continues at its current pace, the city and county would each get a little more than $2 million in gaming money at year’s end. As has been the case from the start, the casino appears poised to fall well short of what was expected by each government entity.

In budgeting for 2017, the city and county both used the low-end projection from the casino’s application and pro-rated it to a March opening. That leaves each government expecting about $2.75 million in gaming revenue for 2017. Gaming revenue is expected to stabilize by 2019.

 Of course, we need to ask: “Stabilize” at what level? And, we might also ask what Schenectady County spokesman Joe McQueen means when he says that “thanks to the infusion of casino money, . .the county is now expecting to see about $855,000 in annual savings.” Is this figure based on some sort of “netting out” of revenues received due to added expenses and reduced receipts from other sources, such as sales or property taxes because of the Casino’s Substitution Effect?

  • As we wrote here more than three years ago, research by the successful citizens’ group “No Downtown Casino” in Hamilton, Ontario, Canada, led them to conclude in their Position Statement

    Greater negative financial impact on nearby businesses – the good numbers go down.

    Studies show that property values near a casino decrease by 10% or more once the casino opens. Part of the reason for that is because the casino never closes. It operates 24/7. Commercial buildings, apartment buildings, condominiums, etc. decrease in value which means over time they pay lower property taxes. Research also shows that 60% of businesses that existed before the casino opens, go out of business within 2 years of the casino opening. Lost jobs. Lost taxes. Failed entrepreneurs. Empty storefronts.

It may be too early for such effects to be apparent in Schenectady, but we need to be vigilant when speaking about how much the Casino has enhanced our tax coffers.

first lap of the Casino Horse Race

Rivers Casino in Schenectady is doing a lot of advertising in Saratoga to try to capture prospective gamblers arriving in the area for the Saratoga racing season. Nonetheless, its take for the first week of the Saratoga meet is one of its worst yet, adding up to only $2,563,000, down 7% from the mediocre prior week. (Saratoga Racing and Hotel had a modest increase for the first week of racing season.) With its relative paucity of charm, and cultural and retail offerings (and virtually no clothing stores, art galleries, or museums of note), and even with the opening of casino’s The Landing hotel, it is difficult to see how Schenectady can compete for business from outsiders attracted to Saratoga Springs and its ambiance, especially after they see actually experience the Schenectady that Dave Buicko calls a “Destination”.

casinodesignactual As I have asked before, with an unattractive casino exterior, and more attractive casino/racino competitors, who will choose Schenectady (more than once)? This is perhaps more of the Snowman Effect that we at this weblog have feared. Having failed to demand a quality product from Rush Street Gaming worth the designation as a tourist destination, and failed to make Erie Boulevard the least bit appealing as an introductory entryway to Schenectady, newcomers used to real cities with real Renaissance downtowns, can only be let down by what they find in Schenectady.

  • crimescene-casinoWe are, of course, wondering when the Gazette will cover a story posted at the Times Union website on Friday, August 4, 2017: “Schenectady County had N.Y.’s highest crime rate in 2016” (by Emily Masters).” Schenectady County Sheriff Dom Dagostino told the TU, “We are a stopping point for the drug trade (from) downstate,”  and the Sheriff added “that Schenectady, Albany and Rensselaer counties serve as a distribution hub for the rest of upstate New York. The other two counties’ crime rates came in as No. 5 and 12, respectively, out of 62 counties statewide.”
    • Meanwhile, Schenectady Police Chief Eric Clifford “wondered if Schenectady’s geography tipped the scales.” Sorry, Chief, I do not think the Governor’s plans to move some Stockade properties out of the Mohawk floodplain can expand to move the whole City off of upstate New York’s Drug Trade Highway.
  • Speaking of a comparison with Saratoga, “Saratoga County, which also borders Schenectady, ranked No. 50. Compared to its northern neighbor, Schenectady County is more diverse, less affluent and [more] densely populated.”
  • update (August 8, 2017): This afternoon, the Gazette posted online the article “Schenectady County had the highest crime rate in the State in ’16,” by Steven Cook. The article looks at various ways to look at the numbers.

 

new high (big rush) at Rivers Casino

 Lucky Coincidence? Just as the Schenectady Gazette ran an editorial urging that we “Give it more time for revenue from Rivers Casino” (July 17, 2017), Schenectady’s Casino was ending its best week ever for Gross Gambling Revenue. The week ending July 16, 2017, its 23rd week in business at Mohawk Harbor, saw GGR of $3,882,454. That is the best week since its first full week in business back in February.

  • Oddly, although the take last week was up 36.8% from a relatively good prior week, both Slots GGR and Poker Table GGR were down. All of the impressive increase came from Table Games, which had a GGR of $2,039,456. It was the first time Table Game gross gambling revenue was over two million dollars. Did a party of high-rollers (maybe the Bluhm Clan in town for the Casino’s Hotel opening) show up last week to let the good times roll?
  • Or, did Billy Fuccillo show up to throw a huuuge party at the craps tables?

Whatever the reason, after giving space to the many poor GGR weeks at Rivers Casino at Mohawk Harbor, I thought we should spotlight today it oddly good news. I’m not sure, however, if even six more months of weeks like Week 23 would meet Rush Street’s happy projections or even the County’s sober first-year hopes.

 follow-up (Aug. 6, 2017): See “first lap of the Casino Horse Race.”

 

good at gaming the system: from cash cow to cow chips

When it comes to gaming the political system for tax breaks and special perks, it’s hard to beat the gaming industry. In New York State, there are different rules and tax rates for its full-blown casinos, video-gaming racinos, and Indian casinos. Such factors help complicate the casino industry’s tax-gaming game, making for increased melodrama, campaign contributions, and lobbyist income.

. . share this post with a shorter URL: http://tinyurl.com/CashCowChips

Last week, the Times Union reported, in Harness tracks, racinos, feel the heat from casinos” (by Rick Karlin, June 18, 2017), that:

 Jeff Gural, majority owner of the troubled Vernon Downs harness track and video lottery game “racino” in Vernon, Oneida County, said he would have to close his doors this fall if he didn’t get a tax break. [note: Mr. Gural is a major contributor to Gov. Cuomo.]

And, today, the Schenectady Gazette published “2 harness track racinos look to state for relief“ (by John Cropley, June 19, 2017), and noted:

Two harness racing tracks that host electronic casino operations are looking to the state for help amid increased competition from the proliferation of casinos across upstate New York.

One piece of legislation would allow Saratoga Casino Hotel in Saratoga Springs to use 4 percent of its net win for capital improvements.

Another would increase the percentage of the net win retained by Vernon Downs Casino Hotel in Vernon, near Utica.. . .

Both bills have been approved by the state Senate but have been sitting in committee in the state Assembly. The 2017 legislative session is scheduled to end Wenesday.

In response to this year’s crop of Gaming Groveling and Gambits, the Times Union published a Sunday editorial, “No subsidies for the casinos” (premium online content).

The Issue:

Citing financial problems, an upstate gaming venue seeks a tax break.

The Stakes:

Taxpayers should not have to support cash cows that morph into albatrosses.

“Lets be clear what a tax cut means: A loss of revenue that other taxpayers have to make up. It will be what casino proponents insisted would never happen: state taxpayers subsidizing gaming halls that were supposed to be cash cows.”

The TU editorial concludes: “Certainly it’s fair to find equitable ways to spread the benefits so that hard-pressed local economies like Oneida County’s don’t suffer. What’s unfair is to ask taxpayers to continually cover venues for the bad bets they’re proving to be.”

No matter what happens in this Legislative session, I’m betting that billionaire Neil Bluhm’s Rush Street Gaming minions here at Schenectady’s Rivers Casino at Mohawk Harbor are already looking into ways to reduce their gaming and property taxes and gain advantages over their casino and racino competition. That is what they have always done at other casino venues, in good times and bad.  Best bets for Boo-Hooing from Rush Street:

  • using the failure to meet their revenue projections as the justification for seeking a reduction in the gaming tax revenue rate
  • pointing to lower gaming tax revenue rates at racinos and at other casinos (under Legislative compromises meant to aid locations in less populated or poorer areas) as “unfair” competitive advantages for their competitors
  • challenging property tax assessments whether or not they are having financial success

Unlike casino owners elsewhere, Rush Street has made no promise in Schenectady about putting off challenging property assessments. Here’s what the Worster Massachusetts VoteNoSlots group said a couple years ago about Rush Street and taxes:

At each of their four casinos, Rush Street Gaming has either fought to have its property assessment reduced, or threatened to reduce it:

  • As soon as Rush Street opened Riverwalk Casino in Vicksburg, Mississippi, it fought to have its property assessment reduced from $78 million to $30 million.
  • Almost as soon as they opened Rivers Casino in Pittsburgh, they began lobbying to have their property assessment HALVED, and have continued to do it every single year.
  • The city of Philadelphia also was involved in a legal dispute with Sugarhouse Casino over property tax.
  • If the state (of Illinois) approves a Chicago casino or slots at horse tracks, then Bluhm wants to be able to add more slot machines and pay lower tax rates in Des Plaines. “We absolutely need both,” Bluhm said when asked whether he would accept one without the other. “We couldn’t possibly survive. The numbers won’t work. If we just lower tax rates and couldn’t expand, we would be crushed.”

As we reported here when arguing against naming the primary road into Mohawk Harbor “Rush Street,” after failing in their campaign to achieve the 60% reduction in their property tax assessment they had sought in Vicksburg, Mississippi, Rush Street sold their Riverwalk Casino, in 2012, just four years after it opened.

But, Rush Street Gaming doesn’t have to be doing poorly to try to avoid taxes. As reported in some detail just last year at BetterGov.org, in “Rivers Casino’s Jackpot: $1 Million Property Tax Break” (by Chuck Newbauer & Sandy Bergo):

RiversDPCasinoWindfall

Rivers Des Plaines

The owners of the wildly successful Rivers Casino in Des Plaines have received more than $4 million in property tax cuts since opening nearly five years ago, by aggressively arguing that the property was worth tens of millions of dollars less than it cost to buy and build on.

Since 2012, Rivers has reported annual revenues of more than $400 million, after winnings, state records show. Its revenues are twice as large as any of the other nine Illinois casinos.

Despite their success, the Rivers owners claim the value of the casino and parking garage has declined, justifying tax relief. . . .

Tellingly, several successive reductions by the elected Cook County Review Board (from $104 M to $88 M each year) “is not enough” for Rivers Casino in Des Plaines: “The owners have gone to court seeking refunds of taxes paid in three previous years, arguing the assessments are still too high.” Rush Street’s primary owner Neil Bluhm is a well-known contributor and “bundler” in the Democratic Party. Although he did not donate to the Cook County’s elected Board members, his tax attorneys and appraisal firms have given substantial amounts.

The BetterGov.org article also makes a point similar to the Times Union Editors:

Whatever the case, the casino’s gain is their neighbors’ loss. Home owners and other property owners in Des Plaines and some surrounding communities have to pick up the slack to fund budgets for local schools, parks and other local government expenses to make up for the Rivers tax cuts.

Beyond property assessments, Rush Street Gaming is definitely not shy about efforts to change the rules in place when it received its casino license. For example, it has tried strenuously to fend off competition to its successful SugarHouse Casino from a second Philadelphia casino, although the State Legislature had for many years envisioned the second casino. First, it said the State Racing Commission could not re-issue the license after the first licensee failed to get necessary funding. That stalled the competition for years, before the argument was rejected by the State Supreme Court. “Pa. High Court Affirms Propriety of 2nd Philly Casino License” (Law360.ocm, by Alex Wolf). Nonetheless, SugarHouse’s lawyers have raised other issues in court, which have stalled the large South Philadelphia casino project even further. See  “Whatever happened with that South Philly casino?” (Billpenn.com, by Anna Orso, Jan. 6, 2017). Expectations are that SugarHouse and the other plaintiffs will lose again, but its Rush Street owners have “won” several years of added profits by operating as the only casino in that big town.

  . . click for cash cow cartoons & cow chips cartoons 
From Cash Cow to Cow Chips, Are they Too Important to Let Fail in Schenectady? Should Rivers Casino Schenectady start to seem more like a Cow Chip Factory than a Cash Cow, you can count on the local leaders who bet their reputations on the Mohawk Harbor casino to help in efforts at the State and local level to seek subsidies of various kinds to alleviate Mr. Bluhm’s suffering. It would be an amusing drama to watch, if it weren’t so important (and predictable). Stay tuned.

Rivers Casino hits a new low for revenues

 Schenectady’s Rivers Casino’s 12th week in operation generated its worst revenues figures so far: GRR $2,237,542. That was 11.6% lower than its prior worst week, which ended April 16. Slots dollars were the lowest yet. And, last week’s poker dollars were down from the prior week:

 

Despite revenues going down for the 8th time in 10 weeks, Rivers Casino’s Schenectady General Manager, Mary Cheeks, had this conversation with TU food columnist Steve Barnes:

 Q: How has Rivers performed in its first three months, and how does that compare to company projections?

A: I have no complaints. We’re still in ramp-up mode, so I’m fine with what we’re achieving so far, and we’re making changes as warranted.

Also:

Q: What do your demographics show about where Rivers patrons are coming from?

A: Primarily from the Capital Region, but surprisingly enough to me, as someone who’s been in this business for 27-plus years, is the large amount we have coming from beyond 120 miles. Since the casino’s hotel isn’t open yet, we’re assuming most of them are day-trippers, not lodgers.

Q: The casino operates 24 hours a day. Is there really enough business to warrant that?

A: Yes.

Q: For example, on average, how many patrons are on the gambling floor at 3 a.m. on a Monday or Tuesday?

A: I’d have to guess at least 300, but it’s not just for gambling. [restaurants and lounge also open]

  • Personal Note: Why am I not a journalist? I do not have the poker face to deal with statistics-free generalities or half-answers, much less the unanswered questions.

Also, have you wondered about the size of payouts at Rivers Casino Mohawk Harbor:

Q: What is the biggest largest payout at Rivers so far?

A.  It was $47,000 on a slot machine.

Q: What was the biggest at the Philadelphia and Pittsburgh casinos in the 5 years that you handled both of them?

A. In Pittsburgh, $150,000, ad $100,000 in Philadelphia.

Poker strategy stumbles along the Mohawk (with updates)

 . . Rivers Casino Poker Room

 Despite good media coverage and optimism for River Casino’s roll-out of daily Poker Tournaments last week (see Times Union & Gazette), Schenectady’s Mohawk Harbor Casino posted record-low weekly revenue numbers for the second week in a row, with generated dollars down for the 7th time in 8 weeks. Total GGR for the week ending April 16, 2017 was merely $2,532,004, down  5.2% from the prior week’s nadir. Indeed, its Poker Table GRR during its first week of daily tournaments went down 12.9% from the prior week. And, slots GRR tumbled another 9.7%. Meanwhile, Capital Region competitor, Saratoga Casino and Hotel saw a 6.0% drop from its prior week’s Net Win numbers.

  •  For more information and discussion about revenues at the Mohawk Harbor Casino, see our posting on April 7, 2017, which has relevant charts and links; short URL: http://tinyurl.com/RiversDown . (Image at head of this blurb is  detail from C. M. Coolidge’s “A Friend in Need”.)

update (April 22, 2017, 12 AM): See “Income falls at Rivers, Saratoga: Gross revenues from gaming off more than 5% in week’s stretch” (Times Union, by Eric Anderson, April 22, 2017), which noted:

For Rivers, it’s the lowest weekly revenue figure since its opening in early February, and it came despite a series of poker tournaments during the week.

The poker room has been popular among casino customers, officials have said.

Observers have suggested that extensive roadwork on Erie Boulevard outside the casino may have played a part in the decline. . . .

The casinos haven’t released attendance figures, so it’s not clear how the restaurant and other food outlets have performed.

follow-up (April 28, 2017): Finally some good news for Rivers Casino Schenectady and those counting on its revenue stream. For the week ending April 23, 2017, GGR were $2,866,673, up 11.6% from last week’s lowest-ever figures. See the Official Weekly Report. A screen shot of the April numbers is immediately below this blurb. The Net Win figures up the road at Saratoga Casino were up 3.9%.

RiversRevs28Apr2017

revenues last week worst yet at Rivers Casino in Schenectady

 Rivers Casino’s 9th week of operation generated its worst week of revenues yet at Mohawk Harbor in Schenectady.  Revenues were down for the 6th time in 7 weeks, registering at $2,669,892, a reduction of 7.86% from the prior week’s dismal numbers. Its closest geographic competitor, Saratoga Casino & Hotel, saw a much smaller reduction last week of 1.5%. Here is a composite of the reported numbers on the Racing Commission site:

RiversRevsTo09Apr2017

For more information and discussion about revenues at the Mohawk Harbor Casino, see our posting on April 7, 2017, which has relevant charts and links; short URL: http://tinyurl.com/RiversDown .

print “His Station” by Coolidge

 The Schenectady Casino started daily poker tournaments last Monday, April 10, 2017, in the hope of increasing revenues. [see Gazette coverage, and Times Union coverage of the poker strategy] Those results will not be public until next Friday, April 21, 2017.

A shorter URL to use to share this posting is http://tinyurl.com/RiversRevsDown .

. . for discussion of projected revenues, check out what do those Casino revenue figures mean? (

record decline at Rivers Casino Schenectady

 

For the fifth time in six weeks, week-to-week net revenues at Rivers Casino in Schenectady declined last week. [see the composite Report to the right; and the Official Weekly Report.] The 19.8% fall in revenues, down to $2,897,721, was the largest to date at the Casino, which opened February 8. While Rivers Schenectady saw a significant decline, revenues at nearby Saratoga Casino edged up 1.8% to a Net Win of $2,858,905. (Compare the figures reported March 31, 2017 by the Times Union’s Eric Anderson, here; and click here for our prior revenue coverage)

  •  Rivers also reported its Revenue Tax distributions for February 2017, showing that Schenectady County and the City of Schenectady each received $191,991 as their home community share of revenues paid to the State. The average daily GRR for the opening weeks in February were, however, significantly higher than the daily average since then. Nonetheless, the payment of $191,991 for the 22-day partial month of February would result in an annualized total of $3,185,305. When selling the Schenectady Casino to the Racing Commission and the public, Rush Street (and Mayor Gary McCarthy) projected payment of $4.1 million each (22% more) to the City and the County once revenues stabilized.

. . share this post with this short URLhttp://tinyurl.com/RiversDown

update (Saturday, April 8, 2017): The Schenectady Gazette covered revenue and tax distribution for February and march in an article in today’s paper, “Rivers Casino revenues up in March, still behind projectionsFigures from first full month of operation reported” (Brett Samuels, April 8, 2017). As I wrote in a Comment left at the online webpage for the story (which also suggests other issues needing coverage):

deskdudeThe real news is not that — OMG!! — revenues for a 31-day month were higher than for a 20-day month, but that revenues have been down five of the past six weeks. In fact, the decline last week was 19.8%, while Saratoga Casino had about a 2% increase.

The Gazette article does give a nice summary of the projection shortfall issue (while also suggesting reasons revenues might rise as the year progresses):

If the current pace of just over $200,000 per month continues, the city and county would take in about $2.3 million for 2017, falling well short of Rush Street Gaming’s projections submitted in its 2014 application with the Gaming Commission. . .

That economic impact analysis, which included five-year projections for gaming revenues, estimated the low-end gaming revenue for the city and county would be about $3.3 million each for the city and county.

In preparing its 2017 budget, Schenectady County used the low-end revenue estimate, $3.3 million, and pro-rated it to a March opening. That would leave the county expecting about $2.75 million in casino revenue this year.

Rivers revenues down 4th straight week (with updates)

 Schenectady’s Rivers Casino at Mohawk Harbor faced its first major snow storm last week. The storm virtually closed the City down on Tuesday, March 14, but roads were serviceable the next day, with the nearby Stockade neighborhood (especially Front Street, which borders the casino complex) enjoying its quickest snow removal experience in memory. It is no surprise that Gross Gaming Revenues at Rivers Schenectady declined from the prior week’s record low figures, making it four straight weeks of falling GGR. In fact, the 1% reduction was less severe than I had expected, with $2,757,738 generated. The image at the head of this paragraph shows the weekly totals since Rivers opened in Schenectady on February 8.

The distribution of the revenues looks interesting to this non-expert observer:

  • slots revenues were down 17.6%, falling to $1,571,972
  • table game revenues were up 44.6%, soaring to $1,060,418

Did grandma decide to stay home, while the high-rollers were snowed in at Mohawk Harbor overnight the day of the storm?

. . you can find the weekly Rivers Casino revenue stats, usually refreshed on Friday morning, here: http://tinyurl.com/RiversSchdyRevs

. . see what do those Casino revenue figures mean? (

newspaper update (Monday, March 27, 2017): As of 1 PM today, the Gazette continues to avoid mentioning this streak of weekly revenue declines. Thankfully, the Times Union did report the revenue picture today, in “Area casinos had another down week” (by Eric Anderson, online on March 27, 2017). The TU notes that Saratoga Casino saw its third weekly decline, and “Rivers reported its fourth consecutive weekly decline”, noting “The most recent figures likely were depressed by a massive snowstorm that struck the Capital Region March 14.” TU also explained that even Rivers Casino’s best week so far does not meet the weekly average it would need to make their “stabilized” 2019 revenues projection. 

  • RiversSchdyRevs31Mar2017 update (March 31, 2017): For the week ending March 26, 2017, Schenectady’s Rivers Casino had its first increase in revenues in over a month. The total GRR, $3,613, 222, was the best take for the Casino since its first full week, with a 31% increase over the prior week’s dismal GRR, which was the Casino’s lowest ever. As you can see from the composite below of the Rivers Casino Total Gross Gaming Revenues Report, there were significant increases in slots (16%) and table games (57%!), with poker revenues up almost 9%.

RiversCasinoRevs31Mar2017

As expected, the Schenectady Gazette never reported that Rivers Casino had four straight weeks of GRR decline, but I’m betting this increase will be up soon at their website and in Saturday’s hardcopy newspaper.


LadyBug14Mar2017 p.s.
“Walkable Schenectady”?  Our Mayor likes to brag about our “walkable City”, as do the gents at Metroplex. A week after the mid-March snow storm ended, many crosswalks in downtown Schenectady were clogged at the curb with snow, and many sidewalks in downtown Schenectady were left unshoveled. The snow had stopped Wednesday morning, but on Saturday evening, March 18, I made the mistake of trying to walk from my Stockade home up Front Street, to Mohawk Harbor and then up Erie Blvd. I spent a lot of time precariously switching from sidewalk to street.

 Front St. at N. Church. . DSCF2601

I was particularly surprised at how difficult it was to be on foot near the Casino.

DSCF2589 . . [L] this is what confronted you on foot at the intersection of Front Street and Rush Street, if you wanted to head toward Erie Boulevard.

DSCF2595 . . DSCF2597 . . Once at the rotary at Rush St. and Erie Blvd., you had some snow climbing to do to get to the Nott St. side of the rotary, with an unshovelled sidewalk once across the street.

DSCF2599-001 . . [L] Most daunting was trying to head south on Erie Boulevard on foot. Once past the overhead walkway, virtually all of the sidewalk had the full 19 inches of snow, all the way to Stewart’s, at Green Street. If a business had shoveled at its driveway, the curb at the intersection and crosswalk was piled even higher. I was left to walking at sunset on the side of a very busy road, with fast traffic and lots of puddles. Not pedestrian-friendly, Mr. Mayor. Not a good introduction to visitors on the ease of getting from Mohawk Harbor to our much-touted downtown Renaissance.

another big drop in Casino revenues

 The numbers are out for the fourth full week (ending March 12, 2017) of revenues generated at Rivers Casino at Mohawk Harbor in Schenectady: just under $2.8 million; the worst week yet; and no snow storm to blame.

  • a 21% drop from the first full week
  • 9.9% less than last week’s numbers, which were down 11% from the prior week, and were never reported by the Gazette

  • The weekly average needs to be $4.3M to reach the $223 million annual gaming revenue number so often repeated by Mayor McCarthy, which is the projection for the “stabilized” 2019. So far, the four full weeks have averaged about $3.2 million, which won’t even generate the significantly lower first-year projections of the Casino and County.

  • Today’s Gazette tells us there are changes coming to Rivers Casino due to patron requests and frustrations. Changes in works at Rivers Casino, including poker tournaments: Some customers have expressed frustration”, by Brett Samuels, March 17, 2017). It would have been a nice place to mention the slide in revenues, rather than: “[I]t has continued to net at least $3 million per week in gaming revenue and pulled in $10.8 million in its first month from slots and table games after payouts.”

On St. Patrick’s day, we must ask our good boyo Mayor Gary McCarthy if anyone but leprechauns believes in magic pots of gold?

 . . from Hallmark

10 P.M. Update: The Times Union has covered the newest revenue figures, in the online article “Revenues drop again at Rivers Casino in Schenectady” (Eric Anderson, March 17, 2017). The piece gives some context for the numbers:

So far, the casino hasn’t reached the $4.28 million weekly average figure that was projected in an economic impact study by New Orleans-based The Innovation Group.

But that figure was for 2019, and by then the casino hotel should be open and construction at the neighboring Mohawk Harbors completed.

It’s also not clear whether bus tours to the casino have yet started. That also can be a lucrative source of revenues.

. . find the weekly Rivers Casino revenue stats here: http://tinyurl.com/RiversSchdyRevs

. . and, see our post: “what do those Casino revenue figures mean” (March 5, 2017)

what do those Casino revenue figures mean?

OPEN LETTER to the SCHENECTADY GAZETTE and Other Capital Region Media

. . and see March 10 update below . .

. . and “another big drop in Casino revenues” (March 17, 2017)

Dear Schenectady Gazette and Local Media editors and reporters:

ch6casinorev We need some context, please, when you give us weekly (and soon, monthly) numbers about the gaming revenue generated at Rivers Casino at Mohawk Harbor. [E.g., Gazette, TU, WRGB-Ch6News] Gaming revenue numbers are virtually meaningless without background information, such as typical patterns for casino opening revenues, and this Casino’s own projections for annual revenues. This is especially true because Rush Street Gaming will be paying its gaming taxes based totally on the net gaming revenue figures. That is unlike other casinos where minimum annual local contributions have been promised (including Rivers Casino in Pittsburgh, which has consistently fallen short of its projections, and used the shortfall as a reason to request reduced real estate assessment).

  •  images-7Reportage on the second week’s Casino revenue is a prime example of numbers without context. Neither the Casino’s projected revenue nor industry expectations or patterns in the opening weeks of a casino were mentioned. Moreover, the Gazette headline touted, “Report: Rivers Casino sees revenue boost” (Feb. 27, 2017), with the article stating that there was a 24% increase in gross gaming revenue ($33.8 million) and a 16% boost in net revenue ($3.5 million) for the first full week of operation. While it mentioned the snowstorm in Schenectady during the first week, there was no indication of how many days were counted in the first week’s numbers, which included a “soft” by-invitation opening day before the official opening. Nor was there any discussion of the significance of a 16% increase for a full 7-day week, which has 14.28% more days than a 6-day week, and 29.5% more days than a 5-day week. Instead, a prepared statement by casino officials is quoted: “We are pleased with the performance of Rivers Casino & Resort Schenectady during our first full week of operation.”

The Gazette and Mayor Gary McCarthy have consistently used the number of $223 million dollars in annual net gaming revenues for the Schenectady Casino, with a resulting payment of $4.1 million annually each to the City and to the County. $223 million is, on average over a 52-week year, about $4.3 million per week. So far, Rivers Casino Schenectady has posted net gaming revenue of of $3.55M and $3.47M for its first two full weeks of operation, after an opening short week of $3M. 

abacusThe average revenues for Rivers Casino’s first two full weeks, $3.51M, would result in annual net gaming revenues of $183M dollars upon which to calculate its State gaming tax bill. That is 18% lower than the $223M projection, and would mean a significant shortfall for local tax coffers.

 How well do casinos usually do during their opening weeks? I’ve been hoping the Gazette would tell us.


sleuth Last night, I spent about 30 minutes Googling casino opening revenues, and looking at the first two examples that came up, I discovered that the new mega-casino project MGM National Harbor, located on the Potomac River in the D.C. suburbs of Maryland, generated about $49M in gaming revenues in its first month (January 2017). Maryland’s racing commission hired two consultants to project annual revenues for National Harbor. One predicted $512M and the other predicted $575M. Annualized, National Harbor’s first month revenues are about $576 million dollars, which is on track to meet even the higher projection.

plungegraphsmY

trends?

 Similarly, in July 2015, Plainridge Park Casino near Boston generated $18.1 million in its first month of operation. Plainridge predicted an annual gaming revenue of $200 million. Annualized, $18.1M would total $217.2M, a nice 8% increase over the $200M projection. (see MassLive, Aug. 15, 2015) Note, however, that early success does not necessarily mean a casino will continue to generate comparable numbers.  Plainridge Park fell far short of its projections for the entire year.

 Shouldn’t the Gazette help its readers (and our Pollyanna-like political and business leaders) understand how Rivers Casino is doing compared to its projections, and historic revenue numbers for similar casinos? If Schenectady’s “Newspaper of Record” does not do that, I hope other media members less attached to Rivers Casino (and City Hall, Galesi Group, and Metroplex) will do some investigation, or at least basic research.

 In contrast to the Gazette Tilt we have pointed out frequently at this website (recently, as to likely incidents of crime), the Albany Times Union has taken the lead over the past couple of years on many topics relating to the casino and Mohawk Harbor, Schenectady’s City Hall, PILOTS, etc. I hope it will continue to play that journalistic role, and perhaps spark some responsible journalism and competitive motivation from the Gazette and other media outlets.

. . share this post with this short URLhttp://tinyurl.com/CasinoOpenRevs

  • P.S. What about attendance numbers? How is Rivers Casino doing compared to its projection of 7500 weekday and 10,000 weekend visitors? In July 2014, the TU editorial board was a bit skeptical of those numbers. Follow-up would be nice, as patterns emerge with more moderate weather.

newspaper update (March 10, 2017): This evening, the Gazette posted an article online titled “How Rivers Casino’s 1st month revenues compare to projections“, by Brett Samuels, with a comparison of Rivers Casino’s February revenues and tax payments, covering 20 days, with its first-year projections.  After noting that “the city of Schenectady and Schenectady county received $191,991 each,” for the first twenty days, the article points out that:

“[I]f the city and county each received $275,000 per month in gaming revenue for the next 10 months, it would total about $2.9 million in gaming revenue each for all of 2017, falling short of the casino’s own initial projections.”

. . . “In preparing its 2017 budget, Schenectady County used the low-end revenue estimate, $3.3 million, and pro-rated it to a March opening. That would leave the county expecting about $2.75 million in casino revenue this year.”

The article also points out that “There are a few factors still at play that could influence casino revenues the rest of the year,” and says that the opening of the casino’s luxury hotel, and completion of luxury apartments, and office and retail space this summer will draw more people to the site. [We continue to wonder just who wants a luxury apartment abutting a homely and hectic casino site.]

Here is a screenshot we put together from the Rivers Casino revenues document at the NYS Racing Commission, showing its revenues through its third full week,ending March 5, 2017. Its third full week showed a 10%+  net gaming revenue decline.

RiversCasino05Mar2017Revs

  • Late each Friday afternoon, you should be able to see the latest figures from the prior week, on the Racing Commission site, at this link: http://tinyurl.com/RiversSchdyRevs.

plungegraphsm follow-up (March 12, 2017, 3 PM): As of this point in time, the Gazette has not reported the significant drop in gambling revenue at Rivers Casino in its third full week of operation, which is mentioned immediately above and shown in the screenshot. The Gazette did report on the weekly revenue reports to the Racing Commission each of the past three weeks. Friday evening at about 8 PM, the Times Union posted the numbers, in a brief staff report headlined “Double-digit revenue decline at casino, racino” (March 10, 2017), saying “Rivers gross gaming revenue fell nearly 11 percent to $3,094,804 in the week ending March 5 from $3,472,354 a week earlier. At Saratoga, the net win fell nearly 14 percent to $2,845,411 in the week ending March 4 from $3,302,242 the week before.”

the Lago casino HCA and the Mayor

GMcCarthyMug In his June 19th Guest Column in the Schenectady Gazette, Schenectady Mayor Gary McCarthy attempts to answer critics who have asked why he never tried to negotiate a “host community agreement” [“HCA”] or similar benefits package with Rush Street Gaming [“Rush Street”]. (Guest Column, “Mayor: Schenectady casino deal better than Seneca host package“, June 12, 2015, C8, pdf. file) The issue was first raised at this website in late April, in the posting “Mayor McCarthy left millions on the casino table“, with follow-up postings on May 18th, “Money on the Table, Part 2“, and May 27th, “Rush Street’s Giveaways“. Schenectady resident and business owner Mohamed Hafez, asked the Mayor directly about host community agreements at a City Council meeting on May 11th, and at subsequent meetings.

. . share this posting with this short URL: http://tinyurl.com/LagoPayments

 Mayor McCarthy replied to Mr. Hafez that such agreements are not required here, as they are in Massachusetts, and are not feasible in New York, because gaming tax revenues are paid directly to the State which redistributes a portion to the Host County and City.  That attempt by the Mayor to excuse his failure to seek a community benefits package from Schenectady’s casino applicant led both this website and Mr. Hafez to refer the Mayor to the Host Community Agreement [“HCA”] signed last year by the Town of Tyre with Wilmorite, the developer of the Lago Resort and Casino, in the Fingerlakes County of Seneca New York (which is described in detail at the bottom of this posting).  On June 5, 2015, the Gazette published a Guest Column by Mr. Hafez explaining the need for a host community agreement in Schenectady, and describing aspects of the Lago HCA. “Schenectady in need of host deal for casino” (reprinted here). That column led the Mayor to ask the Gazette for an opportunity to reply. [To see David Giacalone’s Letter to the Gazette Editor in response to Mayor McCarthy, click this link: “Mayor missed point on casino package“, June 27, 2015, C5.]

Mayor McCarthy wrote in the resulting Gazette Guest Column that the casino deal Schenectady has with Rush Street Gaming is superior to the Lago-Tyre Host Community Agreement. The Mayor compares select figures from the Lago HCA and the Tax Accord between Lago and the Seneca County Industrial Development Agency (IDA) and declares the “Schenectady deal” (there is no agreement) to be better. That is apparently because Lago received tax incentives/abatements not granted by Schenectady or Schenectady County to Rush Street, and the projected annual share of gaming tax revenue for the City of Schenectady, $4.1 million, is larger than the estimate of $3.9 million for Tyre/Lago.

TyreLogo Comparing individual, selected pairs of numbers from Seneca County and Schenectady proves little when Schenectady, with a population of 66,000, has nearly 70 times more residents than Tyre, and Seneca County, at 35,000 residents, has less than a quarter of the population of our County. The important point is that both the Town and the County IDA decided to do their homework (i.e., learn what potential host communities have done elsewhere and what the Town’s legal rights are, while commissioning a study to identify likely impacts, and quantify costs and benefits), and then to actively negotiate with their suitors. As a result, they each believe they have negotiated very favorable terms with Lago.

For example, Wilmorite is investing $425M at Tyre (40% more than Rush’s plans at Mohawk Harbor); the jobs it brings will cut the County’s unemployment rate significantly more than similar numbers of employees could do here; and the sales taxes generated due to Lago’s construction and operation will be significantly more than the annual sales tax abatement it has been offered. Seneca County will also receive payments during the period of its IDA accord with Lago that will offset the mortgage tax abatement granted to Wilmorite.

ida-lago-cost-benefit-analysis-table11 The IDA’s Lago Cost/Benefit Analysis concluded that the benefits from Lago for the County will be 51 times greater than its costs (including tax abatements), without counting the enormous benefits of the largest construction project in the County’s history. [summary chart at left; click on image to enlarge] And, Tyre, by the way, is expecting about $4000 in annual gaming revenues per resident, whereas Schenectady’s share of gaming revenues will be about $62 per resident. Moreover, the millions in extra mitigation payments by Lago that are scoffed at by Mayor McCarthy will be about $500 per Tyre resident per year, while Schenectady won’t be getting one cent.

According to the Seneca County IDA (Q & A on the Lago Resort & Casino Tax Accord, Feb. 12, 2015; empasis added):

A study commissioned by the IDA estimates the project will have a $1.8 billion economic impact in Seneca County. The project would also generate $45.3 million in payments to Seneca County; the Waterloo Central School District; infrastructure improvements; and more over 20 years.

As part of the proposed agreement, Seneca County would receive $3.83 million more than it would have expected to receive thanks to efforts by the joint IDA and County project advisory committee. This level of payment would exceed the level that would be projected to be paid under the already available New York State statutory 485-b property tax exemption program that this project would qualify for. For nearly 40 years, New York State has offered this 50 percent property tax exemption to businesses that invest $10,000 or more per year on building enhancements.

All of this is in addition to the Host Community Agreement with the Town of Tyre that will generate a projected $10.5 million in payments over 20 years to provide additional services such as fire, ambulance, and sheriff.

This said, Wilmorite has applied for a tax agreement covering sales, mortgage and property taxes. These include $16 million in New York State, regional and local sales tax exemptions, and $3.35 million in New York State and Seneca County mortgage tax exemptions.

As part of the accord, the developer has committed to purchasing construction materials and supplies from Seneca County vendors whenever possible, offsetting the local sales tax exemption.

In addition, as part of the accord, Seneca County would receive payments in future years, offsetting the mortgage tax exemption.

. . . .

For the reader’s convenience, we are repeating below our lengthy discussion, from the earlier posting “Money on the Table, Part 2“, of the Host Community Agreement between the Lago Casino and the Town of Tyre.

.

 Lago at Tyre. More telling than Albany’s efforts to obtain a community host agreement is what happened with the Lago Casino & Resort in the Town of Tyre, a tiny agricultural community in Seneca County, NY, which was the eventual “winner” in the Finger Lakes Region. Although Tyre has a population below one thousand, its leaders had a thoughtful and thorough response when they learned that the Wilmorite Corp. [also known as Wilmot] wanted to put a casino on a parcel within the Town. Beyond getting itself good legal advice and keeping its residents fully informed and involved, the Town commissioned the study “Impacts of Wilmot Casino on the Primary Impact Area: Emphasis on Socioeconomic & Public Safety” (June 2014, 44-pages), which was prepared by the Center for  Governmental Research, in Rochester, NY. Tyre also requested Cornell University to review and summarize a compilation of Canadian studies on the impact of casinos, especially problem gambling.

The well-informed leaders of the Town of Tyre Board of Supervisors were, therefore, prepared to negotiate a Host Community Agreement [“Tyre HCA”, June 2014, ] with the Applicant. (The HCA notes on its title page that the Agreement constitutes a “Community Mitigation Plan, as Contemplated by the Upstate New York Gaming Economic Development Act of 2013.”) The lengthy list of responsibilities accepted and covenants made by Wilmorite, the Tyre-Lago Applicant, is a testament to the thoroughness of preparation of the parties, and also to the strong desire of Wilmorite to secure the approval of the Town Board and be a good neighbor if it were selected for the Finger Lakes Region gaming license.  (For a good summary of the terms of the Tyre HCA, see “Details of casino host community agreement unveiled“, Finger Lakes Times, by David L. Shaw, June 13, 2014.)

 The Lago Casino owner-devloper agreed that, among other things, it would:

• Pay all costs and expenses incurred by the town for attorneys, accountants, engineers, consultants and others in connection with the casino review process.

• Pay the town $100,000 annually from 2016-21 for the purchase of development rights or other action related to the preservation of agricultural land in the town, to mitigate the loss of farmland.

• Preserve the graves in six known burial sites on the land.

• Pay for the training of a security force acceptable to the Seneca County Sheriff’s Office; for special training of deputies, as needed; and up to $100,000 a year for the anticipated hiring of an additional deputy because of the casino.

• Pay the cost of a new high-rise firefighting equipment for six Magee Fire Department firefighters and will pay the cost of a ladder truck for the department.

• Pay for any medical training required by North Seneca Ambulance personnel who respond to the casino for emergencies. If North Seneca handles a casino patient whose insurance does not cover the entire cost, the company will make up the difference.

• To fulfill a previous agreement with Seneca County Mental Health Department, pay for hiring one additional problem gambling treatment and one additional problem gambling prevention specialist. [Note: the protocol for setting up a Problem Gambling Prevention, Outreach and Education Program looks like a good place for Schenectady County to start to construct its own program.]

• Pay all on-site employees wages no less than 75 percent of the national average for each occupation.

•  To mitigate impacts on town services, pay the town $750,000 in 2015, $2 million on Jan. 15, 2016 (prior to operation), and $2 million on Jan. 15, 2017. For 2018 and beyond, the impact fee will be at least $2 million and be adjusted by formula. Once it begins operation, the Casino will receive credit for Gaming Tax Revenues received by the Town. That is, the Casino must make a prepayment of the annual minimum Impact Fee each January 15, with the Town refunding to the Casino the amount that it receives as Gaming Tax Revenues each year.

• Construct, install, operate and maintain, a six-inch private-force sanitary sewer main from the casino to the existing Petro orRoute 414 pump station.  And, construct and install a new water-line connection to the existing 12-inch water line located on the east side of Route 414, and work to create or extend a water district that includes the casino site. [Note: as anticipated by the Location Board’s application form, the Schenectady casino applicant has stated it will make analogous necessary utility improvements.]

• Design a telecommunications infrastructure for the casino, with at least one strand of fiber-optic cable dedicated to the town and its residents.

  • Implement, at its sole cost and expense, all actions described in the Engineer’s Report prepared for the SEQRA review, and perform all other traffic improvements recommended or required by the New York State Department of Transportation. [Lago estimates that the traffic mitigation measures will cost $4,152,500.]

• Apply to the Seneca County Industrial Development Agency for a payment-in-lieu-of-taxes on property and other taxes. [In the resulting accord with the County IDA, Lago agreed to pay $45.3 million over a 20-year period. That amount, according to the Agency’s estimates, is $3.83 million more than Lago Resort would pay if the project were fully taxed under the New York State statutory 485-b exemptions (which have long been available to businesses that invest $10,000 or more per year on building enhancements). See IDA Press Release, Feb. 12, 2015.]

  • Recognize the right of property owners near the Project to continue farming consistent with past practice using good agricultural practices.
  • Limit its lodging facilities to no more than 220 rooms, unless the Company provides the Town with independent forecasts that demand exists in the area for additional rooms, in order to limit the impact on other lodging establishments in the region, during the first ten years after gaming operations open to the public.

• Take out a $4 million mortgage on the project to secure the company’s obligations to the Town and County. The town will be given first priority lien on the mortgage.

  • Engage in Periodic Review and good-faith negotiation to deal with additional payments for unanticipated or miscalculated impacts, up to $1 million per year.

In accepting the Tyre HCA, the Lago Casino developer acknowledged that construction and operation of Lago would have both direct and indirect impacts on the community. Unlike the Mohawk Harbor Applicants in Schenectady, who denied or trivialized any impact on Schenectady or nearby communities, Wilmorite signed an Agreement stating:

Direct Impacts. The Company acknowledges that the construction and operation of the Project will cause direct impacts on the Town and its residents, including but not limited to impacts on Town infrastructure, environment, public safety, emergency services, social and other impacts (“Direct Impacts”). The Company shall mitigate the Direct Impacts in the manner described in this Article III.

. . . [And]  Indirect Impacts. (a) The Company acknowledges that, in addition to the Direct Impacts described above, the Project will also have known and unknown indirect impacts on the Town and its residents, related to or indirectly resulting from the construction and operation of the Project from time to time (“Indirect Impacts”). Indirect Impacts include, but are not limited to:

(1) increased use of Town services;

(2) increased use of Town infrastructure;

(3) the need for additional Town infrastructure, facilities, equipment and employees;

(4) increased traffic and traffic congestion;

(5) issues related to public health, safety, welfare and addictive behavior;

(6) issues relating to quality of life; and

7) costs related to mitigating other indirect impacts to the Town and its residents.

Schenectady’s City Hall never demanded a benefits or mitigation agreement with Rush Street and Galesi.  Indeed, the Mayor and his Administration, Metroplex, County officials, the Chamber of Commerce, and hopeful casino vendors, have never admitted to any likely negative effects. As a consequence, the City never did or commissioned any independent research or investigation that could be used to rebut the glib and facetious claims of the Schenectady Applicant that its casino would have no significant added costs or negative impact on the City, nearby neighborhoods or towns, or the County. This lack of vital information caused the only non-Democrat on City Council, Vince Riggi, to refuse to vote in favor of the proposed casino.