Campaign to Bring Casino Gambling to North Jersey Appears Doomed

For those looking for a good bet on election night results, the smart money in New Jersey says a referendum on whether to expand casino gambling in the state is headed for defeat.

“It’s over,” said Raymond J. Lesniak, a Democratic state senator who has long favored such an expansion. “There’s no chance it will win.”

At least this time around.

The question at the moment seems to be how badly the measure will lose.

At a rally on the Atlantic City boardwalk on Thursday, Don Guardian, the mayor, a Republican, called on opponents of the measure to deliver an “absolutely crushing mandate” to discourage proponents from ever trying to revive the issue. Five casinos in the city have closed in the past two years, thousands of jobs have vanished and the local government is awaiting a potential state takeover.

“We have to make that spread as big as possible so it doesn’t come back again,” said Bob McDevitt, the president of the union that represents Atlantic City casino workers, who also spoke at the rally.

If it passed, the referendum would allow new casinos to open in North Jersey, close to the tourists and residents of Manhattan. Supporters argue that an expansion is necessary to stem the tide of gamblers defecting to casinos in other states.

Atlantic City once had an East Coast monopoly on casino gambling. But casino revenues in New Jersey have fallen by more than half after peaking at $5.2 billion in 2006, when surrounding states, eager for tax revenue, began to allow gambling halls to open.

Analysts now regard the Northeast market as saturated, with about 30 casinos, racetrack slot parlors and tribal gambling operations between Washington and Maine — and more to come.

The measure’s proponents — including the New York real estate tycoon Jeff Gural, who operates the Meadowlands Racetrack and wants to build a full-scale casino there — envision gambling halls in North Jersey tapping into the most lucrative market in the country, New York City. The new casinos would not hurt Atlantic City, Mr. Gural said, because gamblers from North Jersey were already bypassing it in favor of casinos in Pennsylvania and racetracks with slot machines in Queens and Yonkers.

He and others who support expansion created a marketing campaign, “Our Turn NJ,” that argued that “Pennsylvania and New York have stolen billions of our gaming revenue’” and that new casinos would bring the money back and provide hundreds of millions of dollars to rebuild Atlantic City and finance state programs for older adults.

Mr. Gural and Paul Fireman, a former chairman of Reebok International, contributed $5 million each to the campaign; the horse racing industry and the Meadowlands Chamber of Commerce contributed more modest sums.

Mr. Fireman has proposed a $4.6 billion gambling resort with a 95-story tower next to a 160-acre golf course he currently operates on the waterfront at Jersey City’s southern edge.

The two men, who have also contributed generously to New Jersey politicians in recent years, lined up support from local officials in North Jersey, as well as from Gov. Chris Christie, a Republican, and Stephen M. Sweeney, the Democratic State Senate president. But their campaign has failed to resonate with voters amid the state’s fiscal problems, the trial surrounding the George Washington Bridge traffic scandal and Mr. Christie’s plummeting popularity.

“It was a perfect storm for us,” said Mr. Gural, who owns two casinos in New York State and is an owner of the land beneath the Sands casino in Bethlehem, Pa. “Certainly, Bridgegate didn’t help us when people hear this message, ‘Don’t trust Trenton.’ And not one politician defended themselves.”

In addition, the referendum never specified where the casinos would go or at what rate the state would tax their revenues.

Mr. Gural publicly proposed a tax rate of roughly 45 percent, the same rate Pennsylvania applies to casino revenues and more than four times the 9.25 percent rate paid by Atlantic City casinos. Mr. Fireman sought the same rate as the Atlantic City casinos.

Opponents of the measure waged their own, highly effective ad campaign, “Trenton’s Bad Bet,” which warned that expanding casino gambling would be “another bad deal for taxpayers,” who could not trust politicians to keep their promises.

Companies associated with the Malaysian billionaire K. T. Lim contributed $8 million to the opposition campaign’s $11.6 million war chest. Mr. Lim is chairman and chief executive of the Genting Group, which operates casinos around the world. He and his family control the Resorts World casino at Aqueduct Racetrack in Queens, as well as the Montreign casino resort being built near Monticello, N.Y., which is expected to attract gamblers from North Jersey.

“We thought our interests and the interests of the people of New Jersey were aligned,” said Charles Degliomini, executive vice president of the company that is building Montreign.

Another contributor to the “Trenton’s Bad Bet” campaign was Morris Bailey, a New York real estate investor who owns the Resorts Casino Hotel in Atlantic City with the Mohegan tribe, which also operates a major casino in Connecticut.

Genting has made no secret of its plans to compete for a full-scale casino license in New York City or its suburbs in the coming years, and most analysts expect Caesars Entertainment, MGM and other Atlantic City casino operators to do the same. That could set off a retaliatory move by New Jersey to allow a casino to open near Manhattan.

Adding to the confusion, some operators of Atlantic City casinos have built gambling halls in Pennsylvania, where the spread of casinos — there will soon be 13 — has been most responsible for the steep drop in Atlantic City’s gambling revenue over the past decade. For example, Caesars Entertainment, which owns two Atlantic City casinos, also operates Harrah’s casino resort in Chester, Pa.

At this point, those who support adding more casinos in New Jersey concede that their chances of success on Election Day are nil. Mr. Gural and Mr. Firestone stopped contributing to their advertising campaign weeks ago.

But Mr. Gural said the fight was not over.

“I’m 100 percent certain there’ll be a casino in the Meadowlands some day,” he said. “This argument will be moot. Nobody’s going to Atlantic City.”

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