The casino wheel keeps spinning

delaets landing site from corning tower

Can you picture a casino here?

The death of the E23 casino proposal in Albany probably shouldn't be a shock.

The lack of specifics. The delay in officially announcing an operator. The canceled presentations. When you run the series of events, a dead end isn't exactly a surprise twist.

A few thoughts now that the developers behind the E23 project have spurned Albany in favor of the DeLaet's Landing site on the Rensselaer riverfront.

The landscape

Google terrain map of E23 site

Kathy Sheehan said Wednesday that she was told by a member of the group backing the E23 project that the site near Exit 23 on the Thruway wasn't workable for a casino project because just 17 of the 60 acres there were suitable for development because of wetlands and slope. [TU]

That this issue with the land should emerge as a problem now is... odd. Look at a terrain map of the site -- really, look, there's one embedded above -- it's not like the contour of the site is a secret. Even if you found the site on... a Google map. [Troy Record]

Maybe the landscape issue was something the developers figured they could address, and then later found out the cost would be prohibitive. But wouldn't you think that'd be something you'd want to nail down before making all the fanfare about the project?

Flim Flaum

Comments made this year by David Flaum, CEO of Flaum Management Company, the developer that had been pushing E23.

January 21, 2014 at Mamakating town board presentation, in reference to a possible casino in the Sullivan County town: "This would be my only casino." "You have to the opportunity to get one of these things, and I'll advocate it until the end of the Earth before I lose." (Or not.) [Mamakating News x2] [TU]

March 21, 2014 at Albany city hall, in reference to the E23 site: "We have a site here that is an amazing site, it really is amazing ... We were almost on our way to Rensselaer County, and we said, no, no, we don't to be there, we want to be here. We want to be in the capital of the state of New York. That's where we want to be. They deserve this opportunity, they deserve this revenue. That's what we thought. We stayed true to that." [Rochester D&C]

June 4, 2014, to the Times Union: "Things develop. I love E23."

A deliberate approach

e23 casino rendering2
A rendering of the E23 proposal.

Politicians get a bad rap for all sorts of things, including sometimes skating over the details of an issue. That can't be said for the Albany Common Council in this situation. Viewing one of the council's "committee of the whole" meetings about the E23 proposal, we were struck by the attention to detail members were taking to the possibility of a casino. Among the questions floated and discussed during the meeting:

+ Exactly how many jobs would there be? What mechanisms would be in place to make sure many of those jobs went to city residents, and that minorities would be included?

+ Would the city be on the hook for infrastructure expansions necessary to support the facility?

+ Would there be payments to mitigate increased use of police, fire, and EMS?

+ Would OTB's involvement mean a possibility that some of the land could be non-taxable?

+ How to head off an effort by the casino to challenge its assessment after it opens, thus lowering the property tax benefits promised?

+ Would it be possible to include a "self destruct clause" in the resolution supporting the casino if the developers and operators don't adhere to their agreements?

+ If the casino tanks a decade from now (or whenever), what do you do with such a facility?

It's possible the Common Council was a bit too detailed in some of its concerns. But this was going to be a big project, with potentially big side effects (traffic, problem gambling, and so on) -- so it merited serious, careful consideration, and council members wanted detailed answers. And it should be mentioned that we got the feeling many council members were leaning toward voting for the resolution -- either because of the potential property tax benefits and/or jobs.

Maybe this deliberate process was frustrating to the E23 team, as the Biz Review reported. But it's hard to fault the Albany Common Council for wanting to be careful. [Biz Review]

Rensselaer appears to be taking a different approach. Wednesday night its Common Council voted to support the casino -- before the backers have made a presentation. (Call it the East Greenbush approach.) [TU x2]

Sure, Rensselaer leaders have probably already tumbled the idea a bit because of previous possible proposals. And the way its mayor talks, the city really needs the tax revenue. But the decision just seems... the opposite of deliberate.

The Cuomo admin's role

One of the hard things about the state's casino siting process is that a bunch of events are being jammed into a relatively short period of time. The request for applications was only released at the end of the March, and casino license applications are due by the end of June. In that time, developers and operators are supposed to get all their presentations together, and local municipalities are supposed to consider those presentations and then vote on whether to support the proposals.

That's not a lot of time for projects that could cost hundreds of millions of dollars and potentially have long lasting impacts for the communities that host them.

So, why the rush?

Is a Capital Region casino viable?

casino at east greenbush rendering

A rendering of the proposed Casino at East Greenbush. There will be slot machines in the baskets of those hot air balloons. (OK, maybe not.)

One of the questions we still have about a Capital Region casino is: Will a casino here be viable over the long term?

That might sound like a stupid question -- you know, how do you lose money on a gambling operation? But the state has some experience with that. And elsewhere in the country where casinos already exist, there's talk of a gambling glut. [NY Post] [NYT] [NYT]

The backers of these casinos make it sound like there will be fountains of money. But where is that money going to come from? And if a large portion of the customers for a Capital Region casino will come from out of the region -- as E23 backers told community meetings -- then from where?

Think about it: Massachusetts is on the verge of adding casinos, with a huge facility planned for Springfield. There are already casinos in Connecticut and Pennsylvania. There's already the Turning Stone casino between Albany and Syracuse. And there are casinos in Montreal. [Boston Globe]

The odds are (ha) that two casino licenses will be awarded to the region south of the Capital Region in the Hudson Valley/Catskills -- so if you're from the New York City area, do you drive past those casinos to come to the Capital Region? If you're in Massachusetts, do you drive past Springfield or the Connecticut casinos? If you're from the west, do you pass up Turning Stone and whatever casino might be set up in the Southern Tier?

Where do these not-from-here people come from?

Maybe there's a good answer. It's the sort of thing that would probably be in a detailed market study as part of thorough presentation for a proposed casino. Something we're still waiting on.

The current players

The Capital Region casino players, as of June 4:

+ The Casino at East Greenbush - Saratoga Casino and Raceway / Churchill Downs Incorporated

+ Unnamed casino at DeLaet's Landing in Rensselaer - Flaum Management / Global Gaming Solutions

+ Rivers Casino & Resort at Mohawk Harbor in Schenectady - Galesi Group / Rush Street Gaming (Gazette article)

+ Town of Florida/city of Amsterdam site in Montgomery County - Clairvest Co (Leader-Herald article)

+ Howe Caverns in Schoharie County - Howe Caves Development Corp. (Biz Review article)

Comments

As news pieces on various casino proposals in the Capital Region seem to be coming out all the time these days, I'm left with one question: why is this being pressed so hard? Has it been decided that we.must.have.a.casino. in the Capital Region at all cost? Is this the only way our leaders can dream up revenue, and jobs, for this region? Who decided to pursue this? (Sorry, 4 questions.) :)

This is a serious question from someone who has paid absolutely no attention to the goings-on of this matter until now.

Here's the nuttiest thing I've read all week:

Mayor Daniel Dwyer points out the site's accessibility, which is within walking distance of the Albany-Rensselaer train station. He also touts the view of Albany's skyline right across the Hudson.

http://albany.twcnews.com/content/news/706052/rensselaer--ready-to-be-home-to-new-casino/

You know that de Laet never saw Albany :) He was a pretty good writer and cartographer althotgh he relied a lot on third party sources years after events happened. For those wondering what the connection here is, well, he was a director of the Dutch West India Company that owned Fort Orange (Albany). It's a stretch but close enough.

Never trust a man who wears a turtle neck at a business meeting.

The demise of the proposed "E23" casino project is welcome news to anyone who wants a sustainable, non-parasitic local economy. In terms of making sense of how this project evolved (or devolved, as the case would have it), I would add something to your analysis: Albany is cash-strapped, and it would be politically naive to assume that Mayor Sheehan and the Common Council were unaware of the financial benefits this could bring in the short run to close the budget deficit. Seeing as how the Common Council actually asked questions while Sheehan to my knowledge never raised concerns publicly, it wouldn't surprise me if she wanted the casino and thought that it might be finessed through. Luckily, the public organized and acted and the Common Council did their due diligence rather than roll over, in the process helping to ensure that this project be properly vetted. The result, as has been the case with many "economic development" boondoggles when this happens, was the cessation of the project. Funny what a little daylight does to boondogglers. Flim Flaum on out of here, and perhaps Mayor Sheehan will work with the Common Council in the future to get real answers. +1 Legislative Branch.

If anyone has stars in their eyes about casinos, they need to take a hard look at Atlantic City. Back in the day, all sorts of promises were made there about jobs, economic development, & money for schools, etc. Go take that look at A.C. & see how wonderfully all those promises have been kept, how well the school system is doing. Existing side by side with the glitz & glamor of the boardwalk is devastating poverty. Casinos, in general, are like deer ticks, parasites on the resources & infrastructure of a community, but giving little back to it, especially when community leaders with dollar signs in their eyes sign any potential benefits away to tempt the casino to the area. So, community leaders, if you are bound & determined to have a casino, make sure you have a better negotiator & lawyer than the casinos. Don't sell your constituency (the ordinary voting people, not corporations) short!

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