New Jersey Regulators: “We Can’t Make Casinos Stay Open”
Posted on: August 15, 2014, 05:30h.
Last updated on: August 15, 2014, 01:36h.
With four Atlantic City casinos potentially closing this year, many in the city as well as greater New Jersey are understandably shocked. Keeping those casinos open just a little longer might help soften the blow a bit by giving employees and officials more time to plan for the future. But while that might be nice, state officials say they can’t force those casinos to stay in operation if the properties want to shut down.
New Jersey state casino regulators have said that they cannot force two casino owners to stay open for an additional four months while they wait to see if new buyers can be found. The two casinos, the Showboat and Trump Plaza, are both expected to close this summer.
Private Business Decision
Last month, State Senator James Whelan, along with Assemblymen Vince Mazzeo and Chris Brown, had asked the New Jersey Casino Control Commission (NJCCC) to force both of those casinos to stay open for several months past their intended closing dates. However, NJCCC Chairman Matthew Levinson wrote back earlier this month to say that determining a closing date is a decision that belongs to those businesses alone, and sits far beyond the commission’s authority.
“The commission simply does not have the authority to direct a casino licensee to forestall a business decision to cease its gaming operations,” Levinson stated in the letter.
The Casino Control Act does allow the commission to ensure that casino operations are shut down in an orderly fashion. However, nothing in that law allows the commission to continue operations past the date on which the owners want to close their doors. It also cannot force a casino owner to give more advance notice to workers than what is required under the relevant state and federal laws.
Showboat, Trump Plaza Could Close Before End of Summer
Caesars Entertainment plans to close down the Showboat casino on August 31. They are searching for a buyer in the meantime, and Atlantic City Mayor Don Guardian says there is interest in the casino. Trump Plaza plans to close its doors on September 16, and while a sale is also possible for the casino, there has been little talk of interest in that property.
Caesars filed a report on Monday with federal securities regulators noting that they are still planning to close the Showboat. The report did not mention any plans to find a buyer before that occurs.
“In June, we announced the difficult decision to close Showboat at the end of August,” the company wrote in that report. “Other participants in the market have followed suit in what we believe to be a painful but constructive development for the market. We are hopeful that rationalization of capacity in Atlantic City combined with concerted effort to attract mid-week traffic and hospitality guests will help stabilize the market,” Caesars said in its statement.
In the politicians’ letter, they also asked the commission to put an end to the practice of companies barring the new owners of casino properties they sell from running casinos on that site. But the commission said that the enforcement of such deed restrictions “is a matter for the courts, not the commission.”
The rash of Atlantic City casino closures began earlier this year with the shutdown of the Atlantic Club. The Revel, once considered the shining star of Atlantic City and currently in bankruptcy court, could potentially close down in the near future as well, if a new buyer cannot be found.
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