![handle is hein.journals/gmglwr20 and id is 1 raw text is: DOI: 10.1089/glre.2016.2011
Gambits
News in brief about the gaming world
EUROPE TAKES A
VOLUTARY STEP TOWARDS
HARMONIZATION IN
REGULATING ONLINE
GAMBLING
Regulators in the European Eco-
nomic Zone met in Brussels recently
and, on November 27, 215, signed a
cooperation agreement in regards
to online gambling. Not all the regu-
lators signed on the 27th, but a ma-
jority did, and the remaining ones
(other than Iceland) either signed
shortly afterward or made a commit-
ment to sign in the weeks ahead. The
agreement is not based on any EU
legislation, and so is voluntary (i.e.,
non-binding). However, it is a clear
sign of an intention to keep moving
towards closer cooperation in terms
of regulating online gambling.
The agreement states that signato-
ries will share information about
matters of mutual interest, such as
market data and new games. They
also intend to cooperate on a variety
of fronts, including supervision, en-
forcement, compliance, consumer pro-
tection, anti-money laundering and
anti-fraud measures and actions, and
sustaining the integrity of the games.
ATLANTIC CITY
STRUGGLING
FINANCIALLY
Atlantic City is struggling-not just
the casino industry therein, but the
city itself. That's in large part be-
cause the city's municipal revenue
is heavily based on property taxes
paid by casinos, but the loss of four
of 12 casinos has eroded that base
by a third. Casinos had accounted
for half the city's budget in years
past, but with loss of a third of them-
and successful tax appeals by the
survivors, who argue winningly that
their properties are worth less in a
$2.7 billion gambling market than
they had been worth previously in
a $5.2 billion (at its peak) market-
the city has had to raise taxes by
32% ... and even with that enormous
increase, is still falling behind.
Loss of revenue is only half the
equation, however: the other half is
cost. As New Jersey State Senate
President Steve Sweeney put it, At-
lantic City has a budget of $262mm
(million) for 40,000 people, but
[c]ompare that to other communi-
ties with 40,000 people ... a mayor
in Middlesex had 60,000 people and
his budget was $53 million. Or for
comparison: your editor lives in
Glen Ridge, New Jersey, whose pop-
ulation is 7,600, or around one-fifth
of Atlantic City's, and has a budget
of only $13mm, or 5% of Atlantic
City's. The neighboring city to where
your editor lives is Montclair, New
Jersey, with a population almost ex-
actly that of Atlantic City, but a bud-
get less than one-third ($80mm) the
size. Or Newark, New Jersey, which
is the poster child for urban ills, has
a $742mm budget-not quite three
times Atlantic City's budget-for a
population of 277,000, or more than
six times Atlantic City's. By any rea-
sonable comparison, Atlantic City
is probably spending three to five
times as much per capita on its gov-
ernment as other communities do or
as it realistically needs to.
Atlantic City's governmental bloat
is undoubtedly a relic of its gaming
industry's boon years, when the
city was raking in revenue without
having to burden its residents. Hav-
ing lots of money, the city got in
the habit of spending it; but those
good years are gone and are not
coming back. Atlantic City needs to
adjust to a new normal and down-
size expenses, and it needs to do it
fast: analysts warn that the city is
just one major financial issue away
from bankruptcy. For example, the
Borgata is seeking $161mm in un-
paid tax refunds owed it from past
tax appeals which the casino one;
if the city is forced to actually pay
that amount in the near future, that
could drive it into municipal bank-
ruptcy.
ATLANTIC CITY CASINOS
GROW INTERNET
GAMBLING REVENUE
Having led off with some rather
sobering news about the United
States' second-oldest commercial
gambling venue, some good news
is in order. That good news comes
in the form of an increase in Internet
gambling revenue. According to the
New Jersey Division of Gaming
Enforcement, November 2015 fea-
tured a 51% gain in Internet gam-
bling revenue vs. November 2014:
$13.2mm vs. $8.7mm. Of course, for
Atlantic City, even the good news
has a downside to it: that $4.5mm
in monthly Internet gambling reve-
nue for Atlantic City only led to a
$1.9mm increase in total gross gam-
ing revenue for the month, since
the Internet gain was offset by a
1.4% decrease in brick-and-mortar
gambling revenue.
REVEL CANNOT SELL ITS
ASSETS FREE AND CLEAR
OF IDEA BOARDWALK
LLC LEASE
The bankrupt Revel Casino in
Atlantic City had sought-and won,
at the bankruptcy-court level-
permission to sell its assets free and
clear of all liens and interests, includ-
ing leases. IDEA Boardwalk LLC,
which had a lease with the Revel to
operate two nightclubs there, objected
and appealed the decision. On ap-
peal, the Third Circuit held that the
Revel could not sell the casino free
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