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Casino official criticizes Liberty, notes losses in water-crisis closure

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There are people working for Saracen Casino Resort who have worked elsewhere in the gambling industry and never seen a casino's lights dim.

But that was before they came to work in Pine Bluff.

"They've only known a casino to be in continuous operation," said Carlton Saffa, chief market officer for the casino. "They've never worked anywhere that was closed for one minute."

Closing, however, is a rather common occurrence these days. The casino's annex opened, then had to be closed because of covid-19. Then the new casino opened in October, only to be closed months later because of the snowy weather. And then it stayed closed because of the city's water crisis.

The snow and covid-19 were outside the control of local entities, but having to close because of the water problems was especially galling to Saffa.

While Liberty Utilities has been quick to define what happened as an act of God, something out of its control, Saffa is in the camp of those who believe that Liberty has not been investing enough in its infrastructure and that had it been investing more, the water crisis would not have happened or at least would not have been as severe.

"I have no confidence in Liberty," Saffa said. "They are trying to blame it all on the weather. As long as they blame it all on the weather, that hides what Liberty has not been doing."

Liberty has defended its handling of the crisis as well as its investments over the years in its operation in Pine Bluff.

On Feb. 18, water pressure in the city started falling. By that evening, a fire truck and then a water truck had been called to the back of Jefferson Regional Medical Center where water was pumped into the hospital's boiler system, which is used to heat the hospital's buildings. That was a dramatic start to the problems, but the pressure kept dropping and conditions worsened.

Liberty said the ultra-cold temperatures froze hundreds of water pipes and caused them to burst, making it impossible for the pumping systems to maintain pressure. One Liberty representative likened the water system to a bucket with holes in it.

Since then, many of the leaks have been repaired or the water has been turned off to those locations, and one of the pumping stations, which had been sidelined, is back to working.

The system is back to working normally, but the state Public Service Commission is ramping up its investigation into Liberty's operation, and Attorney General Leslie Rutledge has said her office is looking into Liberty as well.

The snowfall that hit on Feb. 15 and then again on the Feb. 17 knocked Saracen out of commission for a few days, but Saffa said the casino lost almost seven full days just because of the lack of adequate water pressure, costing it, Pine Bluff and Jefferson County, as well as the state and other recipients, thousands in lost revenue and tax dollars.

Saffa said February and March are the high marks on the gaming calendar, so being closed during that period is something to avoid at all costs.

"It could not have happened at a worse time for us," Saffa said. "February and March for us is like December for retailers. It's the sweet spot for us."

Casino officials wanted to open on Thursday, Feb. 18, but there was no water. The same thing happened on Friday.

Then on Saturday, officials thought they were going to get a break. Saffa said the casino had been "given an indication" that water would be restored that day.

"We were preparing to open," Saffa said. "We brought the staff in and started watching the water pressure gauges with anticipation. But Saturday came and went, and we didn't have squat for water. We paid the staff for a full shift and sent them home."

Asked how much revenue and tax money were lost because of the water problems, Saffa said at least $3 million in revenue and roughly $400,000 in tax dollars. Some $80,000 would have gone to the city and $32,000 to the county.

That, however, does not describe the full picture of a big operation being sidelined. Saffa said many of the expenses of operating a 200,000-square-foot property continue, even when the doors are closed, and the lost revenue numbers don't include non-gambling operations within the casino that went dark. Also, the taxes paid on the gambling revenue do not include other types of levies, such as the Advertising and Promotion tax and other sales taxes that would have been generated had the casino been open.

Saffa said he understands how important those tax proceeds are to the city and county.

"Pine Bluff is relying on us for 800 jobs and tax revenue," Saffa said, "but I can't rely on Liberty."

Saffa said all of the revenue and tax figures were estimates but that a "full forensic accountant review" is underway to determine more precise figures.

Asked if the casino would make up that lost revenue when customers returned to gamble, Saffa said there is pent-up demand to make a trip to a casino. But as far as capturing the lost revenue, he said, that is unlikely.

"Future visits can never replace the time you're down," he said. "People come to the casino with disposable income, and if they can't come and that moment passes, that money may have been spent somewhere else."

Saffa also complained that Liberty could have done a better job alerting customers about the problems associated with the water system.

"We did a better job of letting people know if they could pull a slot handle than Liberty did in telling people if they could pull their faucet handle and get water," he said.

For its part, Liberty has defended its communications with the public, saying it posted alerts on its website and elsewhere as soon as problems started developing.

Saffa said that because the casino does not have faith that another water crisis won't happen in the future and because of the significant revenue that is at risk if there is another shutdown, the Quapaw Nation, which operates the casino, is considering building its own water tower as well as its own water well. Having those options, Saffa said, would allow the casino to have an independent source of water and continue to operate if the Liberty system fails.

"It's something we're looking into," Saffa said.

Casino official criticizes Liberty, notes losses in water-crisis closure

Empty tables and chairs at Saracen Casino Resort were the result of the recent water crisis that sidelined the casino for almost seven days. (Special to The Commercial)

Read more https://www.nwaonline.com/news/2021/mar/08/casino-official-criticizes-liberty-notes-losses/?breaking

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