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"carry mostly negative credit implications that will effectively move revenues from one bottom line to the next without necessarily expanding them," Moody's Investors Service said in a new report. The grim evaluation comes as all-in efforts are being made by Gov. Chris Christie's administration and South Jersey lawmakers to throw casino operators a lifeline.

A master plan for a new tourism district is being drafted with a focus on "enticing new entrants to build both gaming and nongaming attractions that will increase demand in the city," according to the governor's office. The plan is due on Christie's desk by July 1, 2011.

Analysts noted the casinos are being drubbed by competition from expanded gambling in neighboring states.

The Legislature in recent weeks has worked on bills designed to attract new investment by allowing smaller casinos in Atlantic City and by permiting online casino gambling and sports betting.

"We think both (gambling) measures are long shots because the federal government currently bans internet gambling and allows sports betting only in four states: Nevada, Delaware, Montana, and Oregon," the Moody's report said.

Carl Zeitz, a former member of the New Jersey Casino Control Commission who has served as a consultant to the casino industry, said the Moody's analysts "are pretty much on the mark."

"The fundamental problem for Atlantic City is the competition it's facing," Zeitz said. "There isn't going to be sports betting in New Jersey anytime soon, and even it did happen here, it'll happen everywhere. There will be no advantage for New Jersey."

Officials from the Casino Association of New Jersey, the industry trade group, could not be reached for comment.

Zeitz said he agrees with the main points of the Moody's report, except for a passage where the analysts say they believe "the addition of boutique casinos would cannibalize existing Atlantic City operators."

Zeitz said changes in the casino laws to allow less than 500-room hotels could indeed spur new dollars being invested.

"If there's any investment in Atlantic City from that, it will be a lot better than what we have now, which is no investment," Zeitz said.

Source: http://news.google.com/news/url?sa=t&fd=R&usg=AFQjCNHsLrM1H6C-v6c4JSSRvwTt2KwVgw&url=http://www.dailyrecord.com/article/20101130/COMMUNITIES/311300007/1005/NEWS01/Moody-s--New-legislation-won-t-help-AC-casinos

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