Upstate New York’s four new commercial casinos aren’t making as much money as they thought they would. Now, two of the four are reportedly asking state lawmakers for a bailout.
In fact, two Upstate New York newspapers claim Rivers Casino & Resort in Schenectady, NY and Del Lago Resort and Casino in Tyre, NY have both asked state lawmakers for some type of financial assistance. The hope was to convince the state to offer some sort of financial help before the March 31 buget deadline.
The Tioga Downs Racino in Nichols, NY converted into a full commercial casino in December 2016, adding table games and real money cash slots. Operators expected to pull in $103 million in revenue in the first year but fell $30 million short.
Rivers and Del Lago both opened in February 2017. Rivers operators projected the casino would generate $222 million in revenue during its inaugural year. It missed by close to $80 million. Revenue was projected to reach $263 million in year one at Del Lago. It ended up $100 million short.
Finally, the $1.2 billion Resorts World Catskills opened in Monticello, NY last month. Bigger in every way, revenue at Resorts World Catskills is expected to far outpace Rivers and Del Lago. However, in its first five weeks, the casino has been on the same pace as the two smaller facilities.
Tax revenue below projections
According to the The Daily Gazette newspaper in Schenectady, Rivers projected it would pay between $69 million and $86 million in taxes during its first year of operation. It actually paid just $45.45 million. Del Lago projected it would pay between $59 million and $76 million in taxes. It paid just $42.92 million.
The Rochester Democrat & Chronicle reported a Del Lago official was in the state capital asking state lawmakers for some kind of tax relief. No specific request was outlined. However, a Del Lago spokesperson said the casino is having a difficult time competing with nearby Tribal casinos.
Rivers bailout details
Assemblyman Phil Steck, whose district includes Rivers, said Rivers is asking to:
- Take 10 percent of the money it pays in state taxes and funnel it into marketing efforts.
- End the requirement to pay the state to run security checks on its prospective employees.
- End payments it is required to make to Saratoga Casino Hotel (or it’s horsemen’s association).
- Apparently, there would be no reduction in host-community payments to the city, county, city school district or surrounding counties.
Steck says he’s in favor of the plan. However, Gov. Andrew Cuomo told a USA Today reporter the casinos are private businesses and he has no intention of bailing them out:
“The upstate gaming casinos are private concerns. They bid, they made an investment and some of them will say they’re not doing as well as they hoped or would have expected, but they’re private concerns, and I don’t want to get into the business of bailing out private concerns.”
Cuomo went on to say he’s not sympathetic to the casinos’ plight:
“We did casino gaming to create facilities, generate economic development to create jobs and it has done that. These facilities have done billions of dollars of construction and they employ thousands of people. So to the extent you have a casino saying ‘You know what? I’m not meeting my expectations. I should get help from the state,’ I’m not sympathetic to that.”
After Cuomo’s comments it is not surprising that any sort of bailout did not make it into the budget.
In the meantime, the general managers at River and Del Lago are both leaving. Rivers’ original general manager left the casino in November. Del Lago’s general manager announced this week would be his last.