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Eldorado Resorts is on the Move Again

In one day in April, Eldorado Resorts Inc added eight casinos to its portfolio; seven came from buying Carl Icahn’s Tropicana Company and the other, a casino in Illinois purchased from Caesars. Those purchases are the latest move in the company’s dramatic expansion that began in 2005, when it bought a Hollywood riverboat casino in Shreveport, Louisiana.  The $230 million Hollywood casino was in bankruptcy after struggling with debt since it opened in 2000; Eldorado paid $154 million for it. With the acquisition of the Hollywood casino, Eldorado embarked on its journey to diversification.

Eldorado Resorts began life as a small casino in Reno, Nevada in 1973.  The Eldorado Casino Hotel was built outside of the casino district, north of the railroad tracks. It had just 200 slot machines, 12 tables and 282 hotel rooms.  Don Carano was the driving force behind the operations and in time all of Don’s children came to work in the casino.  The senior Carano’s philosophy is still followed by his children in operating the company’s many casinos.  When Eldorado moved to add a casino in Louisiana to the Nevada operations, it was very clear that the Reno market was always going to be challenged by Indian casinos in surrounding states.  The Carano move to diversify out of Nevada made perfect sense. In fact in retrospect it appears to be the only successful strategy for Reno casino operators.

In 2013, Eldorado announced a merger with MTR Gaming.  That merger was finalized in 2014 and immediately afterwards, Eldorado went public. MTR added three properties and brought the value of the new company up to the billion dollar mark.  In July 2015, Eldorado acquired the remaining 50 percent ownership of the Silver Legacy in Reno and bought Circus Circus.  In 2017, the company received final approvals for its takeover of Isle of Capri’s 13 casinos for $1.7 billion; at that time Eldorado had 20 casinos in ten states. In just twelve years, Eldorado had added 16 properties in nine states to its operations.

However, that was not the last chapter in this story of growth and diversification. In April of this year, there was another announcement.  Carl Icahn had agreed to sell his seven casinos to Gaming and Leisure Properties Inc., a REIT.  Eldorado will lease those seven casinos and operate them for an annual fee of $110 million, after paying an initial $640 million for the leases. And just because it was in the buying mood, Eldorado Resorts announced the purchase of the Grand Victoria in Elgin, Illinois for $327 million.  Upon completion of all pending transactions, Eldorado said its expanded property portfolio will feature approximately 26,800 slot machines and VLTs, more than 800 table games and over 12,500 hotel rooms.

The Icahn transaction is definitive for both companies. Carl Icahn is an investor; he buys properties and companies as an investment.  He purchases at a low point in a market and sells when conditions have improved to attract buyers.  At the same time Icahn was selling Tropicana for $1.7 billion, he also sold an automotive supplier, Federal Mogul, for $5.4 billion.  He has been in and out of gaming several times, usually pocketing a billion dollars or more upon his exit.  Eldorado on the other hand is an operating company; it buys casinos to own and operate.  Each new casino is taken as an opportunity to improve its operations with the philosophies and strategies of the founder, Don Carano.  Although, Eldorado may sell some of the properties it acquires, that is done to concentrate better on the remaining ones.  Regardless of how many casinos Carl Icahn has owned, he is not a “casino guy.”  Icahn is always just passing through, while the driving force behind Eldorado Resorts, the Carano family, is here for the duration.

Consolidation is always part of the maturation of any industry. When the initial growth and expansion phase of an industry has slowed, consolidation begins; the strongest companies continue to survive, profit and grow by acquiring the smaller, weaker ones. The Eldorado is a current example of the trend in gaming.  MGM, Caesars, Boyd, Churchill Downs and Penn National are all products of consolidation.  It took the better part of forty years, but Eldorado Resorts has moved from one small casino in Reno to a national company, one of the largest casino companies in the gaming industry.  I am certain that Don Carano would have been proud of the company’s latest acquisitions. He was a man of big dreams and he built a company with equally big dreams.

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Niagara Falls Closes the Door after the Horses Escaped

In these days of political polarization, very few voters trust any government official.  Actually it is a long-term trend; Forbes has been doing a poll for 16 years on the most and least trusted professions in the country.  Nurses, military officers, grade school teachers and medical doctors are at the top of the Forbes list.  At the bottom of the list are local officeholders, TV reporters, lawyers, business executives and lobbyists.  In 2012, the Atlantic published its list; nurses, pharmacists, doctors and engineers were at the top and at the bottom, stockbrokers, Ad guys, Congressmen and car salespeople.

Based on those two polls, it seems we trust the people in charge of our health and safety and distrust those with their hands in our pockets.  Members of Congress and local officeholders are there because we don’t trust the way they spend our money.  To the poor, naive voters, it appears that lawmakers are just spending without a thought to the future or a rainy day plan.  I think if I were a voter in Niagara Falls, New York, that is the way I would be feeling at the moment.  The city council is developing a plan to control the way it spends money it receives from casino revenues belonging to the Seneca Nation.  A brilliant idea, except the city is no longer receiving anything from the tribes.

The tribal compacts in New York provided an exclusivity agreement in exchange for a portion of its gaming revenues.  The tribes paid the money to the state and the state shared with local communities. The Buffalo News estimated the Seneca Nation paid about $110 million a year, or according to the tribe, $1.4 billion in 15 years. It has been reported that Niagara Falls received approximately $125 million.  However, the Seneca Nation has stopped the payments. The tribe says there was a 14 year limit on the payments and that time has passed. Also important to the tribe, the state did not abide by the exclusivity agreement.  The state authorized slot machines at race tracks, at least one of which was within the zone that had been deemed exclusive.  The state also authorized four commercial, non-Indian casinos, one of which, in the minds of the Seneca, also infringed on the exclusive zone.

The legal battle between the state and the tribe is the second round of the dispute over exclusivity and payments to the state.  The first battle took place between 2009 and 2013. New York settled and conceded $200 million to the tribe.  In the current argument, New York insists the tribe must continue paying according to the original compact and the Seneca Nation says that agreement has lapsed and is no longer binding.  Thus far it is a standoff.  It is much less a pressing issue to the state than the tribe; however, to the city of Niagara Falls it is really important. The city had learned to live off the tribal funds and without them Niagara Falls is in a financial crisis.  It may be forced to drastically cut expenses and raise property taxes to fill in the gap between revenue and expenses in the 2019 city budget.

Recognizing the seriousness of the budget crisis, the city council led, by the mayor, is taking steps to insure it never again spends too much of the money from the Seneca casino on day to day operations.  Instead, there is a proposal to put five percent away into a contingency fund and limit to 35 percent the amount that goes into the general fund.  It is certainly a good idea to limit the amount spent on daily activities and put a guaranteed percentage into a rainy day fund.  However, it is a bit late; the horses have already fled the barn.  Every child on a ranch learns to close the barn door to keep the horses from escaping.  However, it is not a lesson that is taught to politicians and only occurs to them when the horses – or in this case the Indian casino monies – have bolted and the barn is empty.  It is fortunate for the Seneca that the city of Niagara Falls cannot impose any taxes or fees on the casino.  If the city could, it would be taxing the casino to pay for the empty stalls; it is the way of government and the reason elected officials are on the bottom of the trust list.

 

The Casino Quandary of Andrew Cuomo

Resorts World Catskills, New York’s fourth commercial casino opened on February 9, 2018.   It cost $1.2 billion to build and has 2100 slot machines, one hundred and thirty table games and one hundred hotel rooms.  New York is a rather crowded gambling market place; success and profit will not come easily for Resorts.  In addition to the four commercial casinos, there are ten Indian casinos, five Class II and five Class III.  Currently, tribal casinos are estimated to generate approximately $1 billion annually in gaming revenue.  There are nine race tracks with 19,000 video lottery terminals.  The revenue from the VLTs was $2 billion in 2017.  Added to those forms of gaming, there is a state lottery. The lottery reported nearly $10 billion in 2017.  Before the commercial casinos arrived on the scene, New Yorkers were already spending $13 billion dollars a year gambling.  That does not leave much left over for Resorts and the other three casinos.  In addition to the in state gambling options, there are casinos, lotteries, racinos, Indian casinos and charitable bingo halls throughout the Northeast region.

The press in New York has been relentless in pointing out that the casino plan touted by Governor Andrew Cuomo and approved by the voters was far from meeting expectations.  As with all good government plans, when Cuomo was on the road selling his plan to expand gambling in New York he said the casinos would create jobs, lure tourists and allow the state to recapture some of the gambling revenue now flowing to nearby states with casinos.  “We literally hemorrhage people from the borders who go to casinos,” Governor Cuomo told reporters. “I think it will keep the money in this state, and I think it’s a major economic development vehicle for the Hudson Valley especially and for upstate New York.”

The press has not weighed in on the impact the casinos have had on the hemorrhaging, but it was quick to tell the governor and the voters that the casinos were not producing the revenue, jobs or associated development that had been promised.  This story of failure got a new chapter in the last week of March.  Del Lago casino in Tyre is in trouble.  It opened on February 1, 2017.  It cost $440 million to build and has approximately 2000 slot machines, 100 table games, a poker room, 200 hotel rooms and a bunch of restaurants.  When the ownership group of Wilmorite and Peninsula Pacific were making their pitch for a casino license, they estimated the casino would generate $263 million in gaming revenue a year. The casino pays 37 percent on slot revenue and 10 percent on table game win. Given that the slots are currently generating about 70 percent of the revenue, the blended rate is just short of 30 percent. Del Lago could be expected to pay $80million a year in gaming taxes.

However, in the first year the casino generated just $158 million in revenue; the tax is thus $30 million less than expectations.  But the state coffers and the press are not the only ones disappointed.  The owners are not getting what they expected either and have asked the state for a break.  What kind of a break?  The casino management would like to reduce their taxes by 10 percent so they can put that money into to marketing and promotions.  It claims conditions have changed since they started to build the property and one of the things that has changed is the Indian casino marketing.  According to del Lago management, the Indian casinos have become more aggressive in their marketing, stealing away customers who otherwise would have been happily pushing buttons on slot machines at del Lago Resort Casino.  One has to wonder if Wilmorite and Peninsula spend any time studying the market before jumping in with both feet and $400 million.

True, since the casino plan was approved by the voters in 2013, the tribes in New York have been upping their game.  They have spent millions on upgrading and improving their casinos and even added a couple of new, smaller casinos meant to solidify the borders between the Indian casinos and those the state was licensing.  The tribes in New York are very experienced at dealing with the European invaders; the five civilized tribes, as they have been known for several hundred years, have existed in New York for several thousand years.  They are not likely to throw up their collective hands and say, go ahead take our customers – not to the governor, the voters or the new casinos.  Instead one can expect the tribal casinos in New York to continue to do everything within their power to protect their customer base.

It will be a battle, but only one of many that are being fought across the region.  The long expansion of gaming is reaching its final stage.  Each new casino authorized and built in the region will enter into a market just as crowded as that of del Lago.  The stakeholders are going to have to dial down their expectations and then get used to even those being unfulfilled.  It is becoming increasing difficult to meet the goals of either the government or the operators in this crowded market place.  The upcoming casinos in Boston, Springfield, Pennsylvania and Atlantic City will all discover the same basic fact that there are too many casinos and something has to give.  The casino quandary does not belong exclusively to Governor Andrew Cuomo, it is going to be shared by governors in Pennsylvania, Massachusetts, New Jersey and other states.

Bang! Wynn and Packer Just Got Their Equilibrium Punctuated

March had some shocking moments for the gaming industry. In separate events two industry giants suddenly walked off, if not into the sunset, at least into the clubhouse.  Both were evolutionary moments; in the blink of an eye, the gaming industry evolved. There are two dominant theories in evolution; one says that change to a species takes place slowly over long periods of time, often in the millions of years.  The other theory holds that there are long periods of no change – stasis – followed by sudden and dramatic change – called “punctuated equilibrium.”  Think of dinosaurs and comets.

In the 1990s, I was coordinating the gaming series of the Oral History Department of the University of Nevada, Reno.  We used the punctuated equilibrium concept; interviewers were taught to look for events that made instantaneous switches in direction for the subject.  I thought of it in terms of a person walking along the road, when out of the woods jumps an assailant who punches the walker in the side of the head.  In one moment, the person is facing in another direction and continues walking, but on the new and unexpected path.

That happened to two industry legends.  Steven Wynn and James Packer were seemingly marching down the road to even greater wealth, fame and happiness when out of the bushes an attacker emerged.  In James Packer’s case, he was his own assailant.  Last week, he suddenly resigned from his company, Crown Casinos, and checked into McLean psychiatric hospital in Boston, citing mental issues.  Packer has always been a very high profile person.  He dated and married gorgeous models and last year was keeping company with Mariah Carey.  He is famously rich. In 2006 he was the richest person in Australia, but has fallen to ninth in 2018.  James did not build his wealth, Kerry Packer his father did.  Kerry Packer was an internationally known high rolling gambler.  He was said to have won and lost as much as $30 million on a single trip to Las Vegas.  James always lived in his father’s shadow, including tagging along on some of those famous gambling trips.  James wanted to be like his father, he wanted to beat Las Vegas.  However, he used a different strategy, buying or building a resort on the Strip.

Twice James Packer and his company invested heavily in Las Vegas. Neither project came to fruition and his Vegas losses dwarf those of his father.  And lately, problems have developed elsewhere.  Crown was doing very well in a joint venture in Macau, but then got caught illegally recruiting gamblers in Mainland China.  In Australia, Crown had a grandiose plan to reinvest in the company’s properties and expand into other forms of gaming.  Without James to push the projects it is anyone’s guess about Crown’s future in Australia.  Packer’s ups and downs, friendships with the political and entertainment elite of the world and his relationships are far too complicated to cover here, but he has been a very busy boy for all of his 50 years.  The question now becomes what happens to Crown Casinos, his private investment company and the rest of his life.  But a bigger question might be, who will James Packer become now?

The story of Steve Wynn is just as dramatic and from the standpoint of industry observers, much more amazing.  No one would have believed on January 1st that within three months, Steve Wynn would be gone.  In January the stock was over $200 a share and on the 22nd of January when Wynn Resorts reported, its net revenues of $1.69 billion were up by 29.9%.  Steve was clearly on a roll, the kind of thing he had been doing over and over again since the late 1970s when he became an industry phenomenon, a wunderkind.  In a month, Steve’s world had started to unwind. The Wall Street Journal published an article that claimed dozens of women accused Wynn of sexual misconduct.   A few years ago, the article might have cause a blip in the stock price, but not much more.  However in the aftermath of the Harvey Weinstein scandal and the ever-growing me two movement, the article set off a chain of events that ended his career with Wynn Resorts.  Within a week of the publication of the article, the stock had dropped from $200.60 per share to $163.22.  Wynn first resigned from his position with the national Republican Party, and then from the company.  In March, in a series of trades, Wynn sold all of his stock in Wynn Resorts to Galaxy Gaming, a Macau company.

Nothing in my many years of following events in the world of casinos compares to the end of Steve Wynn at Wynn Resorts, the third public company he founded. Its casinos in Las Vegas and Macau were just the latest version of Wynn’s long line of successful visions for the best of all casino-resorts.  He has spent over 40 years creating casinos unlike those of other people.  If Wynn were fifty years old, like James Packer, maybe he could start again.  Assuming of course, he gets out of the legal and regulatory mire of the accusations against him.  But Wynn is seventy-six years old and a come-back seems highly unlikely.  However, Steve Wynn has been able to pull the rabbit out of the hat more often than anyone else in the industry and until his funeral I would not bet against him.  Still, the legal and regulatory challenges are huge, possibly insurmountable.

James Packer and Steve Wynn must each feel as if his equilibrium had been punctuated; as if they had been slugged in the side of the head with a baseball bat.  Their departure will alter the industry.   Maybe not as much as it will change their lives, but still it will be changed. Steve’s vision will be missed, but his behavior will not be.  Sexual harassment is going to become a regulatory issue and it will force the casino culture to adapt to the new standards of acceptable behavior.  I do not pretend to celebrate the loss of the Steve Wynn’s genius, but I do think the industry needs to update its culture and behaviorAnd with the new stock holders and examinations by regulators in Massachusetts, Macau and Nevada, the changes in Wynn Resorts are also far from over. More than one person and corporation has been slapped alongside the head and pushed down a new path lately.

 

Sands Bethlehem Announces Sale for the Second Time

Las Vegas Sands sold its property in Pennsylvania to an Indian tribe from Alabama.  On the surface the story is pretty straightforward, but it does have some interesting twists and turns.  The Poarch Band of Creek Indians through its affiliate, Wind Creek Hospitality, has agreed to buy Sands Bethlehem for $1.3 billion.  A year ago, MGM and Sands came to that same agreement, but MGM decided with a dramatic expansion of gaming about to begin, it probably wasn’t a good idea.

Actually, the expansion is why the Sands wants to unload the property, even though it is the best property in the state. Last year the net revenue was $579 million and because it has a hotel, Sands has been really good at marketing table games, much better than its competitors.  In the fiscal year 2016-2017, the Sands generated 27 percent of the total table game revenue in Pennsylvania with only 19 percent of the tables.  In 2016, the management was so excited about its prospects that it planned a $90 million expansion. The press releases described in glowing terms the great things that would come with the new addition.  It was to add 35,000 square feet of gaming, an additional restaurant and a separate poker room.  The expansion would have made it the largest casino in the state.  However, the expansion did not happen, even though the company broke ground on the project before declaring it dead in the water. Why the drastic change?  The same reason MGM backed out of the deal.  Pennsylvania is in the process of its largest expansion of gaming since slot machines were first authorized in 2004.

The Poarch Band of Creek Indians apparently did not get the memo about the risk.  Or may it did and is not worried.  The tribe operates three Class II casinos in Alabama.  It has tried numerous times to convince the state to authorize casinos so the tribe could add class III gaming with real slot machines and table games.  During one of the discussions the tribe offered the state over $200 million for Class III legislation, but all to no avail.  Without any success in expanding in Alabama, but with plenty of money in hand, the tribe has branched out to Florida, Nevada and the Caribbean.   The tribe also bought land in Mississippi for a casino and in 2016 sought to purchase the Margaritaville Resort Casino in Bossier City, Louisiana. The sale was canceled because of a dispute over licensing payments for the Margaritaville name.

So while some observers think “the Indians” are biting off more than they can chew, those opinions are likely to be based on a lack of understanding of the tribe’s management abilities and resources.  Regardless of the tribe’s skills and financing, Pennsylvania is going to be a challenge, as it will be for every operator in the state.  The legislation that authorized expansion was passed in October, 2017.  The process is only beginning; a series of auctions is being conducted for one of ten mini-casino sites and licenses.  Ten more casinos in the state with an additional 7,000 slot machines is going to make the Pennsylvania market quite crowded.  However, that may not be the worst thing coming down the track.  The state has also authorized online gambling, including online lottery games.  And the legislation includes slot machines in truck stops and airports.  No one is quite sure what any of those will mean to the existing casino industry or when they might begin.  The mini-casinos are first in line and when the bidding is finished it will still probably take a year and maybe two before the first mini-casino opens.  In a heavily regulated industry like gaming, everything takes time.  It will take a year, for the Poarch Band of Creek Indians to be approved by Pennsylvania and complete their financing.  That will still leave them a little window to learn the lay of the land before the new gaming options get started.  In the meantime, the Sands hopes it is free of the stress of the increased competition in Pennsylvania. And once it has the billion dollars in hand it can invest it more profitably.  As good as the Sands Bethlehem is, it only represents about 6 percent of the total revenue that Las Vegas generates in Las Vegas, Singapore and Macau.  If the Sands is lucky, the second time will be the charm.  If not, it is difficult to imagine where another buyer willing and able to pay $1.3 billion for the Sands Bethlehem might be found.

Japan Moves into the Casino Business

Japan is embarking on a casino adventure and it is carving its own unique path.  In December, the Japanese Diet passed initial enabling legislation.  The law as it stands is too vague and could not be implemented without more structure. It needs the where, when, how many, how much and who before anyone puts a shovel in the ground.  But it does not appear lawmakers will find common ground on some issues easily or quickly.  The idea of legalizing casino gaming has been floating around in Japan for most of the 21st century and has run aground in previous efforts.  At one point analysts were predicting casinos would be open in Japan in time for the 2020 Summer Olympics Games, which is clearly no longer possible.

The issue of how to protect vulnerable Japanese citizens is the stickler in the process.  Some of the opposition political parties in the Diet are determined to address the social issues such as organized crime and gambling addiction before any of the casino-specific issues.  The debate is centering on limiting the number of visits to a casino by Japanese citizens and an entry fee intended to discourage would-be gamblers from going to a casino very often.  The opposition also wants to limit the size of a casino to 15,000 square feet and not more than 3 percent of the total floor space of the resort. The passion behind the debate can be found in pachinko parlors, the country’s shadowy gambling industry.  While casinos were illegal, slot- like parlors existed in abundance.  The parlors functioned much like their counterparts in other countries.  Currently, there are 11,000 parlors in Japan with literally millions of pachinko games.  There is an ongoing trend of fewer games and less revenue year over year for at least five years.  The i

The existence of such a huge gambling industry in a country that has banned casino games has undercut the casino discussion and reflects a basic conflict in Japanese values.  On the surface, Japan maintains gambling is anti-social and harmful.  However, gambling in Japan is very big business.  Besides several million pachinko games, Japan has a very large and healthy horse racing industry.  There are approximately 21,000 horse races held in the 288 annual race days; the handle is estimated at $30 billion.  Lawmakers have tightened down on pachinko, but have stopped short of banning it or horse racing.  Still, they have been very reluctant to authorize casinos and the opponents are clearly dragging their heels now.

However, the government of Shinzo Abe has been pushing the idea.  Abe is seeking to strengthen the country’s tourism appeal and generate additional revenue, employment and investment.  The idea has certainly been met with enthusiasm by the gaming industry. Many international gaming companies are extremely interested; it is being estimated that a Japanese casino industry would generate in excess of $20 billion annually.  Given the size of both horse racing and pachinko games in Japan, the estimate does not seem unreasonable.  Initial investment proposals by companies such as Wynn, MGM, Sands and Genting have been in the neighborhood of $5-10 billion.  And while the strict limits on Japanese gamblers and casino size pose a problem, they may not be a deal breakers.  However, both will likely have an impact on the amount of money gaming companies are willing to invest.

Limited access to casinos by locals and casino size are not the only issues that darken the picture.  The tax rate is singly the most important detail that needs to be added to the legislation. Because the debate has centered on social issues, very little discussion on taxation has taken place.  However, recently the government floated a 30 percent gross gaming tax rate.  Although there are jurisdictions that charge more, thirty percent of gross is a steep price to pay.  It is especially high when the government is expecting each licensee to spend at least $4 billion on a resort that will only have a very limited local clientele.  By implication, casinos would have to spend at least four billion dollars to compete with casinos in Macau, Cambodia, Vietnam and the Philippines for Chinese gamblers.  The lawmakers and the government are working through all of the issues that are important to them.  But it seems to me that little consideration is being given to the operators.  However, I have yet to hear of any of the major casino companies being ready to jump ship because of increasingly complicated and much less appealing opportunity to build a casino in Japan.

 

Pennsylvania Reverses Directions and the CDC Newsroom Responds

CDC Gaming Reports has matured over the last 15 years. It has grown from being the distributor of a single report, the Adams Daily Report, to a news outlet that five days a week publishes the early morning Flash, mid-day Adams Daily Report and the late afternoon Last Call.  And on the weekend CDC publishes Hot Clicks & Picks and the Weekend Report.  The CDC website is constantly updated and many additional features have been added over the years, including videos, podcasts and commentaries.  The changes have grown organically, so that most of the time I barely notice the differences.  However, unusual events sometimes highlight the changes; one of those events was G2E.  At the 2017 G2E, CDC had a full staff on the floor covering the event better than any other media outlet; the team published From the Floor every day of the show.  Another of those unusual events happened on February 21st. On that day, the Pennsylvania gaming regulatory agency granted a license for a new mini-casino and then dramatically reversed its decision all within a six hour period of time.  The CDC team stepped up to the plate and kept its readers up-to-date through the changes.

Here is the story.  In a desperate bid to balance its badly unbalanced budget, the Pennsylvania legislature approved a major expansion of gaming in October.  The legislation had many component parts, one of which was called “mini-casinos.”   The law allowed for ten mini-casinos with 300-750 slot machines and up to 30 table games for an additional fee.  The mini-casino licenses were to be awarded to top bidders at auctions held by the Pennsylvania Gaming Control Board.  The law also allowed communities to opt-out of the process; by the deadline on December 31, 2017 over 1000 communities had declared themselves unwilling to host a casino.  However, the state has 2,500 communities, so there were still plenty who were willing to receive the $1.6 million per year host fee.

The auctions began on January 10th with a new one to be conducted every two weeks.  At the moment, four auctions have been held. On January 10th, Hollywood Casino submitted a winning bid of $50.1 million; on the 21st the Cordish Company and a partner won a license with a $40.1 million bid; and on the 8th of February Mount Airy Casino was approved for its $21.1 million bid.  And then on the 21st the Sands Casino was approved for its $9.9 million offer.  Each of these bids was for a specific community.  By law, a host community cannot be within 25 miles of an existing casino or within a 15-mile radius of another mini-casino.

And therein lies the rub, the community proposed by the Sands was within the 15-radius of the one already approved for the Mount Airy Casino bid. It took the gaming regulators just six hours to realize their error and reverse their decision.  The license was subsequently awarded to Prax Casino’s bid of $8.1 million for a location in South Central Pennsylvania.  The complete story developed during one single CDC day, Wednesday, February 21, 2018. In the morning Flash readers were alerted to an auction that day and the Adams Daily carried a story that the Sands Casino had been awarded the fourth license. In the Last Call readers learned that Sands no longer had a license, it had been granted this time to Prax Casino.  As the story developed during the day the CDC team worked to stay on top of it. It was a “wow” moment for me; I could almost close my eyes and see a newsroom filled with reporters, copywriters, photographers and editors scurrying to get the story.  That newsroom vision in my head comes from an old superman comic book and is sadly out of date, but the CDC team fit into it quite nicely in my mind.  “The story, get the story,” they cried in unison.  They got it and in the process became a real team.  It may not have been a great day for the Sands, but it was a great day for CDC.


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