This action might not be possible to undo. Are you sure you want to continue?
April 7, 1994
Riverboat Casinos Seek A Home in Pennsylvania
By MICHAEL DECOURCY HINDS,
Pennsylvania politicians see jobs, waterfront development and tax revenue spinning in the little windows of slot machines on riverboat casinos waiting to take their place along the state's waterways. Using research provided by the gambling industry, these public officials say that Pennsylvania's gamblers lose $1 billion a year in Atlantic City, about 60 miles southeast of here, and that it would be better if this money were lost closer to home. Tourists who come to Philadelphia to see the Liberty Bell, they add, might also liberate some cash on riverboats plying the Delaware River. But fiscal experts and social scientists say the gambling industry could end up costing the state money, generate crime and, in particular, sully Philadelphia's image as the cradle of American democracy Action in Legislature The State Legislature is considering a measure to permit gambling on Pennsylvania's navigable rivers and lakes, subject to state and county referendums, within two years. Many elected officials in the cities of Erie, Pittsburgh and Philadelphia and in the suburban Philadelphia counties of Bucks and Delaware support the proposal.
Anticipating legislative approval of the bill early next year, casino owners have either bought outright, or bought options for, seven pieces of property along the Delaware River here as well as sites in Pittsburgh. Owners of waterfront properties say two dozen to three dozen gaming companies are shopping for sites around the state, creating a real estate boom along major rivers. Riverboat gambling has already been legalized in Illinois, Indiana, Iowa, Louisiana, Mississippi and Missouri. And legislatures in many other states, including New York, are considering the option. Pennsylvania already has a state lottery and allows betting on horse races. But approval of riverboat casinos is far from certain, since Gov. Robert P. Casey, a Democrat, has vowed to veto any casino bill that he receives before his term ends next January. In addition, the bill faces strong bipartisan opposition in the state Senate, said Senator Robert C. Jubelirer, the president pro tempore of the Republican-led body. Still, Arthur M. Goldberg, chairman and chief executive of the Bally Manufacturing Company, expressed confidence in approval of the casinos, saying, "It's just a matter of time." Indeed, industry consultants say Bally has already agreed to pay about $60 million for 31 acres on Philadelphia's waterfront south of Penn's Landing and has bought a site in Pittsburgh as well, with plans to invest $125 million in each city. Words of Caution
Mayor Edward G. Rendell of Philadelphia is a leading advocate of riverboat gambling. "If you can tell me about any economic development enterprise that will employ 6,000 to 8,000 Philadelphians, give the city $300 million for the right to develop the waterfront and produce $25 million in tax revenues each year, please bring them in to see me this afternoon," Mr. Rendell said in an interview. But fiscal experts say $25 million is not that much in a city with a $2.3 billion budget. They caution that any windfall might be gobbled up on new city services along the waterfront and in dealing with predictable increases in crime, compulsive gambling's corrosive effect on families, traffic congestion and local business failures. They note that Atlantic City lost many retail establishments after casinos came in. For example, 97 of the city's 243 restaurants closed in 1977-87, the restaurant industry says, because of competition from casinos, which subsidize food and drinks to promote gambling. "The idea that casinos are the answer for a state or city with serious economic development problems is a mirage," said Steven D. Gold, director of the Center for the Study of the States at the Rockefeller Institute in Albany. Fast-Growing Industry Gambling is one of the nation's fastest-growing industries. In 1993, industry figures show, there were 93 million visits to casinos, and industry analysts say the American market is only a third
developed. More and more states are trying to tap into an industry that takes in more than $30 billion a year. Indeed, politicians around the country say that states that do not legalize casino gambling risk being left behind with all the problems and none of the profits if casinos are built in adjacent states. Assemblyman Wayne R. Bryant of New Jersey set the competitive tone for the Mid-Atlantic States recently when he introduced legislation calling for a state referendum on riverboat gambling on the New Jersey side of the Hudson and Delaware Rivers if Pennsylvania or New York approved riverboat gambling. "This proposed referendum is a warning shot to Philadelphia and New York City that New Jersey will aggressively protect the Atlantic City casinos against outside competition," Mr. Bryant, a Camden Democrat, said last month at a news conference. Effect on Atlantic City Interestingly, it is the very companies that own casinos in Atlantic City that are among those acquiring waterfront property in Philadelphia and Pittsburgh. Mr. Goldberg of Bally said that riverboat gambling in Pennsylvania would spur interest in Atlantic City's gambling palaces, which include two Bally casinos. But another Atlantic City casino owner, Donald J. Trump, said in a interview that he was buying
property in Philadelphia and Pittsburgh primarily to capture the business of Pennsylvanians who would stop going to Atlantic City if gaming were available closer to home. If the Legislature does not legalize casino gambling, Mr. Trump said, he will probably build condominiums and retail stores on his 22 acres near downtown Philadelphia. "That would probably be better for Philadelphia anyway," said Mr. Trump, who owns three casinos in Atlantic City. "Gambling would make a relatively small amount of money for Philadelphia and would increase crime and problems that aren't existent now."