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Thursday, August 14, 2014

Casino Operators Turn on Themselves

I think that when casinos operators themselves start to question the viability and the morality of their own enterprises, one really should take note.  Speaking at the Albany Law School conference on Wednesday, Jeff Gural, the owner of Tioga Downs Casino & Racing noted:

“I’m very concerned,....I think it’s (casino gambling) peaked. The number of people going to casinos has peaked. This year has been a turning point. Everywhere you go casinos are down, all over. It’s scary. If I was investing in casino stocks I’d really think twice.” [Saratogian]
That last sentence is kinda funny to hear from Gural considering his ambition to spend $100 million to expand his racino into a casino along with a 136-room hotel with five restaurants including PJ Clarkes and an outdoor pool with a waterslide and two lounges and a golf course.  That kinda sorta sounds like an investment in casino stocks, don't it?  Gural also described his typical racino customer as a factory worker who is "overweight, have an oxygen tank next to them."  He later accused Odato of taking his "colorful and descriptive language" out of context, saying that his point was that the "majority of my existing customers" have union pensions, have paid off their mortgages, and don't have "some of the problems that younger people have today."  And indeed, the Tioga site seems to have adjusted their photos to this reality; a little, anyway.  Whereas we usually see the young affluent types whooping it up, here we see Jane and Nancy smiling as they watch their parents gamble their retirement money away, obviously not contemplating the nursing home bills as of yet.


 I don't see any oxygen tanks though.

Magna CEO Frank Stronach, gracing our Empire State with a rare appearance here, was even more blunt about casino customers. 
  “To me a casino and lotteries are taxation of the poor.”
OK, that's what we've been talking about!  Of course, Frank operates a casino of his own at Gulfstream where he taxes the poor in order to subsidize the purses of his horse racing operation there.  I haven't heard any talk of him getting out of the casino business, even though he's apparently not getting rich with it (he's already rich, and says his return on Gulfstream is 1%).  But he does have ideas about how to make horse racing successful on its own.  Like making it a cool place for young people and to serve good food.  (No doubt supplied by Adena Meats.)

Frank also spoke about his plans to make Gulfstream the racetrack prototype for integrity in the sport by carding Lasix-free races, creating an on-track pharmacy (a notion meticulously discussed in this article by the Form's always meticulous Matt Hegarty), and increasing security.  Frank's fantasy world is a place where "there's no cheating," which would make it probably the only place on earth where that is the case. I dunno, maybe Frank can pull that off, and we surely wish him success.  However, there's a tradeoff to the kind of scrutiny necessary to achieve that. 

No, I rather doubt that.  I'm not sure people would be willing to have their dignity regularly violated in that way.

Stronach also commented on NYRA. 
He revealed that he would be eager to share ownership and operation of the New York Racing Association should an opportunity open. He said he thinks it would make sense for his organization to own a third of NYRA, the New York horse owners to own a third and for the state to own a third. [Capitol Confidential]
  Yeah, that'll happen.


Figless said...

Its just wrong for a race track operator to be in the meat business, and even more wrong to use the same brand for your horse breeding operation and the meat operation.

Figless said...

Think of seniors gambling their pensions as a Medicaid spend down.

kyle said...

I think Gural was probably just bragging. You know, beats your customers being dead.