IN THE CASINO INDUSTRY, THEY SAY THE HOUSE ALWAYS WINS

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Jeff Gural, the New York real estate tycoon, on the roof deck at the Meadowlands Racetrack in East Rutherford, N.J. Mr. Gural envisions a $1 billion casino at the racetrack. CreditFred R. Conrad/The New York Times

Billionaire real estate developer and horse breeder Jeffrey Gural has faced constant criticism during his long career in business – but nobody can ever say the man lacks persistence.

Facing dismal polls for the November ballot initiative he championed, which would have paved the way to convert his Meadowlands Racetrack to a full-fledged casino, Gural is now pulling out all the stops to keep expanded gaming on the agenda in Trenton. 

With only three weeks to Election Day, and assuming rejection at the ballot box, Gural is pulling out a new card. The latest push comes from his political ally Assemblyman Ralph Caputo (D-Nutley), to whom Gural has donated over $3,600 through the years.

Assemblyman Caputo, a longtime gaming proponent, is already looking for ways to sidestep the expected defeat of the casino expansion referendum. Caputo told The Associated Press on Monday he will amend two bills he introduced this year to authorize video lottery terminals — essentially slot machines — at state racetracks including Gural’s Meadowlands. 

"I think it's a way around the referendum and I think it's a great way to start the gaming business up again, because it's been so deteriorated,” Caputo told News 12 New Jersey.

It’s an obvious attempt by Caputo to set aside the will of voters and push an initiative that will benefit his political patron Jeffrey Gural. And it’s not the first time that Gural has enlisted his political allies to help him overcome setbacks in his attempts to secure casino licenses. 

In 2013, New York voters easily approved Proposition One, a Constitutional amendment that allowed the state to issue licenses for up to seven Las Vegas-style destination casinos. Arguing that the casinos would revive the Empire State’s economy and reclaim gambling dollars lost to other states, proponents of the measure assembled a powerful coalition of business and labor leaders to bankroll the $4 million effort to support the initiative. Gural, who owns two New York casinos, supported the initiative and personally contributed $800,000 to the pro-Proposition One campaign.

After the initiative passed, Gural launched a bid for one of three new licenses to convert his Tioga Downs casino in Nicholas, New York to a full casino. Despite Gural’s efforts to boost his reputation as a successful track owner for his casino push, his facilities had already been a disappointment for Empire State officials. In 2006, when he re-opened the long-shuttered Tioga Downs, he predicted it would produce a $55 million windfall for New York – with the state collecting up to 69 percent of the gaming revenue generated. Barely a year after reopening, Gural’s casino operations wound up producing less than he projected and sapped funding away from the state’s pension program and education system when the track won the right to cut back its state contributions. In fact, after Gural pressured lawmakers by shutting down the gaming room at his Vernon Downs property, the State of New York gave casino operators a bigger cut of revenues. This diverted $11 million from education funding to bail out Gural’s Tioga And Vernon Downs properties.  

In a decision that left Gural “shocked,” the New York State Gaming Facility Location Board rejected his bid after eight months of deliberations and awarded the license to one of his competitors. The real estate developer responded to the decision by famously throwing a public temper tantrum and Governor Andrew Cuomo pressured him to donate to the Proposition One campaign.  

“And my reward was to get a knife in the back,” Gural told the Binghamton Press and Sun Bulletin after the decision. 

Undeterred, Gural continued to press his case directly with Governor Cuomo. Cuomo, who had initially backed the casino licensing decision, personally intervened and asked board members to reopen bidding for an additional license. Ten months later the full board reversed its decision and recommended approving a casino for the Southern Tier of New York, an area that includes Gural’s Tioga Downs. Gural’s political patronage of Cuomo’s casino initiative was finally rewarded a sole-source contract when the board voted unanimously in August 2016 to give him the license that had been rejected a year and a half earlier.

In the casino industry, they say the house always wins. It’s a saying that Jeff Gural has kept in mind as he’s built a house of political allies and paid off politicians who have acted on his instructions and aided his relentless efforts to expand his casino empire. Facing almost certain defeat at the hands of voters in November, it’s clear that Gural is once again attempting to use his connections and political influence to rig the system for his own interest leaving New Jersey voters to pick up the pieces afterward.   

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