October 3, 2022

New Jersey Considers Allowing Smaller Casinos in Atlantic City

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Additional Casinos Proposed for Atlantic City

The Garden State inched closer  on Thursday to authorizing scaled-down gambling houses in Atlantic City as a method of jump-starting the country’s second-largest gaming market.

The New Jersey state Senate approved a bill allowing for casinos with no less than 200 hotel rooms to be constructed on the Atlantic City boardwalk. That is a significant decrease from the minimum of 500-rooms, and only 10% of the 2,000+ rooms found in the city’s most profitable gambling resorts.

Former Atlantic City mayor and current state senator, recommended the change in order to decrease the financial obstacle that must be overcome in order to build in the city.

The Hard Rock chain, owned by the Seminole Indians, have already agreed to build a smaller casino in Atlantic City should the law allow.

Under the proposal, two of the smaller casinos would be allowed. Currently there are eleven casinos operating in Atlantic City, although there is a chance that three of the current casinos may close their doors because of falling revenues, the ongoing economic woes, and aggressive competing gambling houses in nearby states.

Many of the current casinos oppose lowering the market entry requirement since they were required to opening much larger facilities which required huge investments. To get ease their objections, the proposal includes a provision requiring smaller casinos to devote five percent of gross receipts to a state-controlled fund designed to provide help with financing future expansion.

Should the new casinos not expand during their first five years in business, the 5 percent fund could be applied by other casinos or by the Atlantic City government to fund boardwalk capital improvement projects.

The bill now heads to the New Jersey state Assembly for further consideration.

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