ATLANTIC CITY — First, it was casinos in Connecticut. Then it was slot machines at Delaware racetracks. Now, more bad luck for Atlantic City: new Indian casinos in neighboring New York state.
New York lawmakers approved a plan Thursday to build up to six new Indian casinos, sending shudders down the spines of casino officials in Atlantic City.
Experts say more New York casinos will inevitably cut into Atlantic City’s “feeder markets” in northern New Jersey and New York City, dealing a blow to Boardwalk casinos.
“This is a wake-up call,” said Alfred J. Luciani, president of the Sands Hotel & Casino, which draws 40 percent of its business from those areas. “There’s no question: This will be formidable opposition”
Donald J. Trump was more blunt. Trump, who owns three Atlantic City casinos, said Atlantic City would need tax breaks or other public aid to remain viable as a casino destination.
Desperate to offset an anticipated $9 billion in state losses stemming from the Sept. 11 attack on the World Trade Center, New York state leaders said they would allow three new casinos to be built in the Catskills and three in the Buffalo/Niagara Falls area.
They hope to raise $1 billion within three years from the measure, which includes video lottery terminals at five racetracks and the state’s inclusion on the Powerball lottery game.
New York currently has two Indian casinos — one near Utica and one near the U.S. Canadian border.
With new competition in the Catskills, Atlantic City casinos could suffer a 20 to 25 percent decline in gross operating profits, according to a Bear Stearns report issued this week.
Lehman Bros. casino analyst Joyce Minor says Atlantic City stands to lose business, but she said its 12 casinos have proved remarkably resilient to new competition before.
“While we believe that Atlantic City will no doubt be impacted by Sg Online Casino in New York state, several offsetting factors make us believe that the impact may not be as great as we would initially expect,” …