My City is Poorer Than Yours!

Not to be outdone by Sullivan County, the city of Newburgh wants everyone to know just how shitty things are there. 

"Of all the communities facing economic struggle in the Catskill/Hudson Valley region, none face as daunting a challenge as Newburgh. With a population of 28,866, the City has a poverty rate of 27.9%, and struggles with chronic unemployment and high crime unrivaled in the region," Mayor Judy Kennedy and Newburgh supervisor Gil Piaquadio said in a letter to the state Gaming Facility Location Board.
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"We would like to officially invite the Gaming Facility Location Board to a tour of the City of Newburgh, so that it can fully understand the kind of poverty our residents have been struggling with for decades," the mayor's letter reads.  [Journal News]

That's a pretty grim picture, and a staggering rate of poverty.  It's so bad that one would think that a casino would only help so much (if, in fact, at all).  Seems an effective response to Sullivan County's poverty appeal and to the Gaming Commission's letter that affirmed the law's intent to aid struggling communities.

Casino supporters in the Catskills of course contend that any casino in Orange County will ruin the prospects for a facility in their region.  Not to mention that we've, thus far, seen one developer withdraw because they couldn't get financing because of the threat.  However, Saratoga Raceway & Casino, who is behind the proposed Newburgh facility, contend that this is not the case; that its imaginatively-named Hudson Valley Casino & Resort is the only Orange County casino that can "co-exist with a potential casino in the Catskills."  Complimenting, Not Competing With a Catskill Region Casino.  They claim that since Newburgh is located north of the turn-off for Route 17, the highway that heads northwest from the NYS Thruway towards the Catskills, they won't hurt business there.

That seems like kind of a silly argument.  Closer is closer, regardless of what the route is.  Newburgh is some 24 minutes closer to downtown Manhattan than is the Concord, according to Google Maps; and that's not considering traffic on Route 17, which was always a major issue back in the day when people actually used to go to the Catskills, and could be one again if people flock to casinos to gamble like we're told they will.  Not that it's that big of a time difference; but it is a difference, and if someone in NYC wishes to go to the closest casino, then they'll book a place at the closest casino.  I suppose it's up to the potential lenders and developers in the Catskills to decide for themselves whether or not the claim is true.  In any event, it's a clever ploy by the folks from Saratoga harness (also involved, of course, in the East Greenbush proposal, that one in partnership with Churchill Downs).

 - An interesting situation involving Montgomery County, located northwest of Albany and hoping to compete with developers there for the license in Region Two.  Officials from that county met with a Gaming Commission official in a bid to give the developer who's interested in building in Amsterdam, off Exit 27 of the Thruway (where I used to drive from Union College to watch Rangers games on cable TV) (that was a really long time ago) a lower license fee and more time. 

Matt Ossenfort, the county executive, said he was optimistic at the end of the meeting. He gave the commission several documents and an argument for concessions that include a $25 million cut in the licensing fee for a Montgomery County casino and a 60-day extension for Clairvest and Great Canadian Gaming to complete an application for a casino license........

The county leaders said they represent a region so distressed that the Salvation Army is closing its office and food pantry. [Capitol Confidential]

In a letter to the Gaming Commission which is embedded in the link above, the county cites the widespread support for a casino in the surrounding communities.  "We are not aware of any organization or group in Montgomery County, the town of Florida, or the city of Amsterdam that is opposed to a casino development in the county." Don't think I didn't do a Google search for 'No Amsterdam Casino' and 'No Casino at Exit 27.'  I guess they don't have many tree-huggers in Montgomery County. 

Then they go into their own tale of economic woe.  The poverty rate there is 19.2%.  Not in the same ballpark as Newburgh but, according to the letter, it's "almost 29% above the state average."  There's more, and it's pretty bleak.  Median household income 25.75% below the state average; 31% of children under 18 under the poverty line; an unemployment rate of 7% that's 40% higher than the average rate for the 52 upstate counties (sounds like a bit of spin on that last one).

Montgomery's appeal for a lower licensing fee is based on its contention that the fee pricing structure for Region Two is unfair as compared to the other two regions, in which there are different fees for different areas within the regions.

 

The same argument is made with respect to the minimum capital investment.  The letter goes on to claim that this inequality makes the venture unattractive to potential developers. 

On the announcement of the minimum spend on May 12, [the developers] met again with the local leadership and advised that the economic model of a higher tax rate, a higher license fee and a higher minimum spend in Montgomery County than that in similar Counties in Regions one and five and the same requirements as a potential development in Albany was not supportable.  They advised that without a modification to the economics to those offered to other similar counties in Regions one and five, they would be unable to proceed.

So, the county is asking for a deferral of $25 million of the $50 million license fee (to be recouped by a tax on revenues above a certain level); and a 60 day extension of the June 30 deadline to submit an application.  After all, the letter appeals, 60 days is a drop in the bucket relative to a "20-30 year economic impact decision."  It seems they have a fair point, and I think one can sympathize with their situation. But good luck with that. I'm sure that the Gaming Commission knows that if it makes one exception, it's going to be dealing with a myriad of requests for others.  I'd be pretty surprised if they grant the request.

 - Back in Tuxedo, the consultants hired by the city to assess the Genting proposal addressed an audience of 100 residents on Wednesday, and provided a positive report regarding the Host Agreement they are negotiating with Genting. 

This would include at a minimum $50 million in capital support for town projects, payment of 50 percent of school taxes, $3.5 million in guaranteed real estate taxes and about $7.4 million in gaming tax collection, they said.

"This development has a net positive impact on the town," said Chuck Bedsole, managing director at Alvarez & Marsal. "It has the potential of enhancing the quality of life of the residents. It ensures the long term stability of the town." [Journal News]