TUNICA RESORTS, Miss. — At the height of a recent dinner hour at Mississippi’s largest casino, fewer than two dozen patrons were seated in the buffet’s dining room. A nearby jewelry display sat aglow but bare. The hallways were mostly empty.
This is what happens when a casino resort approaches an inglorious end. And on Monday, Harrah’s Tunica will close, which company officials say will most likely lead to up to 950 job losses. In Tunica County in the impoverished Mississippi Delta, it is a disquieting reality that underlines the deeper threat facing Mississippi and other states with legalized gambling: There may be too many casinos chasing too few gambling dollars.
“There’s gambling everywhere,” said Allen Godfrey, the executive director of the Mississippi Gaming Commission, which reported that the state’s nontribal casinos posted $2.1 billion in gross gambling revenues last year. “If you just want to gamble, you don’t have to go very far to do it.”
It’s extraordinarily rare for a major casino to just shut down. But along with a 2011 flood that closed casinos for weeks and a menu of other attractions that is insufficient to draw more visitors, the spread of the legalized gambling that revived this region has also contributed to its recent decline. “No one knew in 1993 or 1994 what it was going to be like, and then Mississippi showed the world that it could be a viable industry,” said Anthony F. Lucas, a professor at the University of Nevada, Las Vegas, who researches the gambling industry. “And that encourages everybody else that has a possible way into the gate that they can compete.”
PhotoCasinos, including Native American tribal properties, now operate in nearly 40 states, providing tax revenue that states have come to depend on.
“I think governments are generally receptive because, in a way, it’s almost like a tax, but they don’t get blamed for it,” Dr. Lucas said.
At the same time, though, parts of the country are coping with a potential glut of casinos.
In New York, State Comptroller Thomas P. DiNapoli cautioned last week that with casinos confronting new competition, gambling complexes that could open upstate within a few years may not deliver the economic benefits some predicted.
Last month, Missouri’s governor cited a “steep decline” in gambling revenues when he announced a budget shortfall. And Iowa regulators recently turned back a plan for a new casino in Cedar Rapids amid worries that it could destabilize existing properties. Industry experts say Atlantic City, where casino revenues have fallen partly because of the arrival of casinos in nearby states, is one of the markets facing an ominous future. Dr. Lucas said he believed Atlantic City’s “collapse” rivaled Tunica’s.
For years, gambling has been a boon for northwest Mississippi. Millions of people came here to play, transforming this formerly sluggish area into, for a time, the nation’s third-largest casino market and allowing it to shove aside decades of squalor. Not even 30 years ago, the notion of a four-lane highway was whimsical, and an open sewer called Sugar Ditch flowed through the county seat.
When casinos began arriving here in 1992, so did an era of low unemployment, new infrastructure and a sense of economic progress in a place that had known little of it. This community, long called Robinsonville, even earned the new, tourist-friendly moniker of Tunica Resorts.
PhotoThe past several years, though, have yielded a pronounced slump. Mr. Godfrey’s agency said that in April, the 18 casinos in Mississippi River counties logged less than $80 million in revenue, down from $112.5 million just five years earlier.
To people here, the reasons for Tunica’s decline are academic. They simply want to know what will come of a county where — at least for a little longer — nine casinos sit among cotton fields and offer about 9,600 slot machines and more than one-third of the state’s blackjack tables.
“It’s unnerving,” said Sherry Mullins, who worked in the gambling industry for nearly two decades and now manages a liquor store near the road that leads to the Harrah’s compound. “I worry about it. It keeps me awake at night.”
Although Harrah’s initially said up to 1,300 workers would lose their jobs, company officials said hundreds had been placed in other positions, including many at other properties controlled by Caesars Entertainment Corporation. But for those who will be unemployed on Monday, the end of Harrah’s has been jarring.
“When they close the doors on Monday, it’s going to hurt,” said Sabrina Johnson, who has been earning $13.80 an hour as a cook at the property, where she has worked for 16 years. “It’s going to sting.” Ms. Johnson, 45, who spoke during a session organized by a labor union that represents some Harrah’s employees, added, “I know I won’t find a job that pays me what I am making at Harrah’s, but hopefully I can find something.”
Others are less optimistic.
“I don’t have anywhere else to go,” said Jimmy Adams, 66, who has worked at Harrah’s for 18 years. “Nobody’s going to hire me.”
PhotoMr. Adams and Ms. Johnson said they were among the workers who did not expect to receive any severance pay after the casino closes.
R. Scott Barber, Caesars’ regional president for the mid-South, said the company had tried for four years to sell the Harrah’s property here and finally decided to shutter a location that he said had become a drain because of its heavy operating expenses.
That overhead, along with the regional decline, the flood and the recession, created what Mr. Barber described as “the perfect storm” and said it had forced Caesars to act, even though the company had not sold the property.
“You typically divest when you have found a suitable buyer,” Mr. Barber said. The decision stunned this area, which is dotted with billboards advertising casinos and has a privately owned vocational school for aspiring dealers and bartenders.
“I’d love to be able to sit here and spin that this is something good,” said Webster Franklin, the president and chief executive officer of the Tunica Convention & Visitors Bureau. “But this is not good.” There is wide agreement that, because casinos elsewhere in Mississippi are not making up the losses suffered here, the consequences of Tunica County’s decline will reverberate throughout the state, which received a $140 million increase to its general fund in the 2013 fiscal year from gambling taxes. In addition, counties and municipalities received more than $89 million in gambling taxes.
But what is less clear is whether or how Mississippi should try to beef up the industry.
Some members of the Legislature have wondered aloud in recent months whether the state should offer economic incentives, like tax breaks, to existing casinos.
But Gov. Phil Bryant, a Republican who will face re-election in 2015, has said he would resist any such incentives, in a deeply religious state where gambling, despite its fiscal value, remains a target for criticism.
Still, there has been plentiful speculation that a company could soon buy the vast Harrah’s property. Although Mr. Barber said a sale was not imminent, Ms. Mullins is among those hoping for a deal.
“It’s not just the casino,” she said. “It’s the casino. It’s the R.V. park. It’s the convention center. It’s so much more that we’re losing. It’s not just another casino shutting down.”
< Prev | Next > |
---|