Editorial: Lansing casino would be a lousy bet for Michigan

EDITORIAL

By Editors, Detroit Free Press

As only the most recent arrivals in the long line of players looking for a piece of Michigan's casino gambling action, Lansing and Mayor Virg Bernero should know better.

Artist's Rendering: Proposed Kewadin Lansing Casino

Michigan voters made it quite clear (58%-42%) in 2004 that they did not want more gambling in the state unless any expansion was subject to a statewide vote. Ever since, casino dreamers have tried to build upon the constitutional amendment's only exemption, which allows tribal gambling over which the state has virtually no control anyway.

But tribal casinos are restricted to their own reservations. Every tribe that has tried to work around that restriction to date has come up empty-handed. The most recent attempt, a casino in Vanderbilt that the Bay Mills tribe opened in 2010, shut down after a federal court ruled against it. Earlier attempts included asking Congress to sign off on tribal casinos in Port Huron and Romulus, an effort that fell short.

Now Bernero is entering the same fray with the Sault Ste. Marie Tribe of Chippewa Indians at his side. They will either have to go to Congress or hope that the Bay Mills tribe eventually wins its court case in further hearings and sets a new precedent for defining reservation land. But neither the federal courts nor Congress should fall for the dubious logic involved.

Unless a casino can become a major destination for out-of-state travelers, it largely churns local money and removes much of it from the economy. Casinos rank as economic development tools only as part of a mix of entertainment options or, if properly promoted, as a lure for visitors. If Michigan were to develop a statewide casino strategy, Port Huron would probably better fit the development bill as the only border town without a casino.

Lansing residents -- and Michigan State students -- are already within an hour's drive of two of Michigan's 22 Indian casinos. They are hardly out of range of Detroit's casinos, either.

Presumably Bernero and the Sault tribe have marketing studies to back up their estimates of $250 million in annual revenue, with at least $5 million returned directly to the city. (By way of comparison, Detroit's casinos were estimated to have revenues of $1.4 billion in 2011 -- a figure they may never match again if a Toledo casino opens in April, as planned.) Certainly Lansing, like virtually every city in Michigan, would delight in the projected 1,500 new jobs.

But if Lansing succeeds, it will create a precedent not just for itself but for every other city that thinks a casino is the answer to its prayers. Michigan's voters have already said they don't want to go that route -- and praying for salvation via a casino is only a reminder of how desperate people become in tough economic times.

Related Links:

• Lansing casino builders face potential suit aimed at shutting project down
• Lansing casino effort draws opposition
• Michigan Indian tribe wants to halt plans for downtown Lansing Indian casino
• Editorial: Lansing casino would be a lousy bet for Michigan
• Lansing casino plan faces a fight from 2 Detroit casinos, outstate tribes
• Lansing casino builders face potential suit aimed at shutting project down
• Lansing casino effort draws opposition
• Letter from Phil Hogen, former NIGC chair, opposing Lansing casino

Blogger’s NOTE:  Odd that owners of Detroit’s MGM Grand Casino and Greektown Casino have expressed opposition to plans for a Lansing casino while Marian Ilitch, owner of Detroit’s MotorCity Casino, has remained silent?  Not really, since Ilitch and her family’s partner Michael J. Malik, Sr., have pursued plans for casinos in Port Huron and elsewhere for more than 20 years.  In fact, their plans for a Port Huron casino might be tied to plans by the Sault tribe proposal for Lansing.

Gambling Lobbyist Suggests his Scheme for a Waikiki Casino will "Fill Hawaii's Budget Hole"

Blogger's Note: John Radcliffe is a lobbyist for Detroit casino syndicators (investors affiliated with Detroit's MotorCity Casino and failed Indian casino schemes in NY & CA).  For nearly a decade, the Detroiters have been pushing schemes for a stand-alone Waikiki Casino. (learn more at bottom of this post)

Legalizing Gambling Will Be Good For Hawaii
12.20.2011

By John Radcliffe
Gambling Industry Lobbyist

John Radcliffe, Casino Gambling Lobbyist

In a recent Civil Beat editorial, Lowell Kalapa asked the question, “Can Legalized Gambling Fill Hawaii’s Budget Hole?” and then proceeded to argue against it.

The real answer to his question is: “Yes it Can!” Hawaii is the only American state outside of Utah that prohibits gaming. There are 311 million people in the other states and including Hawaii, but excluding Utah, 99.6% of them, live in states that permit gambling, and all of the residents of Utah have hundreds of casinos within easy driving distance of the borders of their state.

What we have here in Hawaii, instead of legal gaming, is a large, uncontrollable, criminal gambling enterprise that involves all sorts of bad elements — including, according to the news reports, rogue police officers. Estimates of the size of our homegrown, illegal, gambling operations range all the way up to one billion dollars per year, and history has shown that Prohibition creates crime, not lessens it. Legalizing gambling will have the same effect that legalizing alcohol had. It will lessen, or even end, that crime. How much “bathtub gin” do you think is made and sold here? None. But there is plenty of illegal gambling and none of it is taxed. If it were taxed, we in Hawaii would have about $50 million in tax revenue added annually.

But what about other, legal, gambling? Hawaii residents also spend about a billion dollars a year on that. Hawaii residents take a total of about 500,000 total trips to Las Vegas, and other gambling destinations each year with many of our citizens taking multiple trips per year. Boyd Gaming alone reported that it earns about $600,000,000 from Hawaii visitors each year. That means that Hawaii is contributing about one billion dollars to the economy of “neighboring” Nevada each year.

Economists like Mr. Kalapa tell us that each dollar spent in a local economy generates about 3.5 times as much, via what they call “the multiplier effect.” That is, the more money that is flying around in an economy, the more money it generates. The billion dollars that Hawaii residents are “contributing” to Nevada, adds about about $3.5 billion each year to their economy and takes from our own. We get nothing. No wonder they love us in Nevada!

All, or virtually all, of our mainland tourists come from states that already have casinos or other forms of gambling, and many of them favor our having one also. After all, there is virtually nothing for tourists to do after dark in Waikiki. No movie theaters. Almost no major entertainment venues. The Waikiki Improvement Association did some polling of our Asian visitors recently, and found that nearly 80% of Japanese, South Korean, and Chinese visitors would appreciate having a casino as an entertainment option in Waikiki.

The bill we had introduced in the legislature last year calls for limited gaming. One stand alone casino, only. All entities that would bid on that single license would have to ante up a $1 million, non-refundable fee, just to bid. The winning bidder would have to pay a $150 million “impact fee” to the state, and the casino itself would be subject to a General Excise Tax of 15%, a tax equal to more than three times the tax paid by all other tax payers in Hawaii. The economic modeling that we did indicates that the single, stand alone, casino would employ 3,660 directly, and produce another 5,717 jobs off-site, increasing the number of total jobs for Hawaii workers by 9,377.

Casinos are very labor intensive. The gross wages per year for those new jobs would amount to an aggregate of nearly $533 million in new money to the local economy. It is expected that the increased taxes from gaming fees, income taxes from employee wages, and from the ripple effect of new vendor jobs, etc., and from the General Excise taxes, will generate an added $86.3 million each year. None of this includes the investment costs for construction and etc. which are estimated to be well in excess of $300 million.

Ah, but what about the “social costs?” The emotional attacks that legalizing gambling will create crime, increase personal bankruptcy, and so on, are always a “hot button” item here in Hawaii. However, the facts in the rest of the country don’t bear them out. Both sides in the casino debate cite various academic studies in their interests, but the only source on that issue that ought to count is the Congressional National Gambling Impact Study Commission, and in its official study of those questions, it found that legalizing gambling has no significant effect on crime, personal bankruptcy, etc., either way. And the facts bear that out among the more than 307 million Americans in 49 states that have already ended prohibition of gambling.

So, to answer Mr. Kalapa’s question, “Can Legalized Gambling Fill Hawaii’s Budget Hole?” The answer is yes, it undoubtedly can help. No single “silver bullet” exists that will solve all of Hawaii’s need to have sufficient income forever. But it goes without saying, that Hawaii will need a wider variety of sources of income than we have now and no other industry is beating down the door. Casino gaming is something that ought to be tried.

Blogger's Note (cont.): Radcliffe represents Detroit gambling interests and his lobbying partner George A. "Red" Morris" represents Las Vegas- based Boyd Gaming Company. Radcliffe and others at his lobbying firm organized the so-called "Citizens for a Better Way" last spring; a front group financed by Radcliffe and his affiliates/clients to push the Waikiki casino scheme.  In April they dumped $40,000 into a sophisticated advertising campaign intended to pressure Hawaii Legislators into supporting their Casino bill. They failed and the individual they recruited to head the so-called citizens group filed a $387,000 bankruptcy after they failed to win legislative support for their Waikiki Casino. While Mr. Radcliffe pimps a casino, it is but one form of gaming. Hawaii could consider a State Lottery, bingo, sports betting and other alternatives without approving any Las Vegas-style casino in Waikiki. The Honolulu Police Department has stood steadfast against Radcliffe's attempts to legalize gambling. Radcliffe is a political confidante of Gov. Neil Abercrombie and began this most recent push for a Waikiki casino by being the first to contribute to Abercrombie's gubernatorial campaign. He's been pushing the administration to support a casino as a new source of  revenue.  After the Governor's election, Radcliffe helped ID and place key staff in the administration including those who've previously worked to legalize gambling in Hawaii. 

Nov. Revenues Boost Year-Over-Year Performance of Detroit Casinos

Solid November boosts year-over-year revenues at MGM, MotorCity casinos

12.14.2011

By Jaclyn Trop

Detroit's two largest casinos continued to improve their revenue growth for the year with a solid November, leaving Greektown Casino and Hotel lagging, according to state statistics released Tuesday.

MotorCity Casino Hotel, the city's second-largest casino by market share, posted the largest year-over-year gain. The gaming hall posted revenues of $431.5 million from January through November of this year, a 5.8 percent gain over last year's $407.9 million, the Michigan Gaming Control Board reported.

Market share leader MGM Grand Detroit experienced a 2.8 percent rise in revenues to $547.4 million.

Revenues for Greektown Casino and Hotel, the smallest gaming hall, fell 0.9 percent to $321.7 million. (Complete Story)

Don't be Fooled by Silence: Clan Ilitch likely Supports (Perhaps Funding) New International Trade Crossing (NITC) Effort

That Tom Shields is out front on behalf of, and viciously attacking opponents of, the proposed New International Trade Crossing (NITC) and that Mike Malik, Mike & Marian Ilitch, and the Ilitch brands are conspicuously absent is not insignificant. They are either very involved behind the scenes helping to bankroll the efforts to approve NITC or they're asserting to Matty Moroun and the people at Ambassador Bridge that they're not involved (albeit with fingers crossed behind their backs) while their agent Shields' is an attack dog for the pro-NITC cause.

NITC:  Which Way Ilitch?

Bridge Battle Posts at HuffingtonPost.com

Tom Shields is the president of Lansing, Michigan-based Marketing Resource Group.  A large segment of his business is earned representing affiliates/partners of Michael J. Malik, Sr., and/or Mike Ilitch and his wife Marian Ilitch (Ilitch Holdings, Inc., Detroit Tigers, Detroit Red Wings, Little Caesar's pizza, MotorCity Casino, etc.).

If one sees Shields' name associated with any business coalition, political committee or a client that's not one of the premium brands mentioned above, odds are still pretty good that he's there because Malik and the Ilitches want him to be.  When Shields refuses to reveal to a reporter who it is that's bankrolling a coalition or committee he's pimping for, odds are good Malik & the Ilitches are funding all or part of the effort.  And even if Malik or the Ilitches don't have any direct interest in the coalition, political committee or client Shields claims to be representing, you can bet he has their blessing; otherwise, he wouldn't take the assignment.

So with that in mind, consider that Shields' is the spokesman for a coalition baking the New International Trade Crossing (a proposed second bridge connecting Detroit with Windsor, Canada).  That bridge is at the center of a multi-million dollar, no holds barred, war raging in Michigan and beyond. (Read more at Huffington Post).

Typically, Shields' has refused to disclose who is funding the political, lobbying and advertising battles for the pro-NITC group although he's published a list of more than 100 individuals and organizations that "endorse" NITC. If those funding his coalition are on that list, why wouldn't he just point to that list? Take a look at that list.  Then consider who's not on the list but would have interests in such an international connection.

You'll note that Michael Malik, Mike & Marian Ilitch, Christopher Ilitch, plus any of their venerable brands are conspicuously absent from the list; as are any of Detroit's three commercial gambling halls including the Las Vegas-owned MGM Grand Detroit.  Yet, Shields is the mouthpiece for the "coaltion" backing the proposed government funded bridge.  Hmmmm....

If Ilitch or gambling money isn't backing the pro-NITC group, you can bet that Shields has their blessing.  Otherwise he'd have turned down the role.

If Ilitch and company brands or Las Vegas gambling interests are bankrolling the pro-NITC effort, there are many reasons political, marketing, etc. that they would want to keep that on the down low. That they've "secretly" funded Shields' campaigns and coalitions previously shouldn't surprise anyone that they could likely be bankrolling this pro-NITC effort now.

But perhaps they're not providing funding, or publicly endorsing but simply loaning Shields out to the cause.  Maybe there's a conflict of interest on their part.

Consider that TVT has previously linked Michael Malik (and the Ilitches) with Manuel "Matty" Moroun, owner of Detroit's existing Ambassador International Bridge -- the decades old privately owned toll-bridge. And it's Moroun, along with the Koch brothers and others who are funding the multi-million dollar battle against the proposed NITC which would be built in large part with government funding.

Among other things, Moroun and Michael Malik have been Grosse Pointe neighbors.  Malik owns property across Lake St. Clair on Harsens Island. Malik had dusted off and re-introduced development plans for Harsens Island a year or two ago that included a large man-made lagoon (marina) with access to the North Channel plus several hundred residential units (single family estate lots, attached garden homes and high-rise condominiums) surrounding the lagoon.  The Ilitch's daughter Denise and her ex-husband originally owned the Harsens Island property and coincidentally, or maybe not, Moroun was also talking about a new Harsens Island bridge at the same time.

That Tom Shields would be playing such a high-profile role in such a contentious and expensive battle over the NITC, suggests he's doing it with the Malik/Ilitch blessing or even more so, at their request.

Regardless, someone should be asking these obvious questions.

See also:

• Ilitch Associate is Manager of Bridgeview RE Ventures L.L.C.,
• Border Crossing South L.L.C. is Headquartered at Ilitch Holdings Office
• Marketing Resource Group: the Tom Shields-owned Political/PR Firm is a Slave to Ilitch/Malik Affiliates
• Ilitch casino frontmen doing damage control again
• Team Ilitch packaged Hawaii gambling initiative as "grassroots;" failed to disclose lobbying payments
• Tom Shields was spreading rumors about Sen. Harry Reid; now his team blames Reid
• Grosse Pointe Neighbors have big plans for Harsens Island
• MAP of the Malik Grosse Pointe properties and surrounding neighborhood
• Harsens Island; a half-way-point in a new system of toll-bridges between Canada and the Michigan mainland?
• Yet another set of circumstances linking Ilitch / would-be Harsens Island Developer and Detroit International Bridge Builder
• Developer of proposed Harsens Island Crossing toll-bridge purchasing land?

Forbes Reports Ilitch-Owned Franchise one of NHL's Most Valuable

Detroit Red Wings Second  Most Profitable US Franchise;
 MotorCity Casino Workers Forced to Pay Own Healthcare Costs

Forbes' 2011 NHL Team Values

Forbes is out with its 2011 NHL Team Values: The Business of Hockey. Despite economic woes among other US sectors, Forbes reports the NHL valuations have hit an all-time high. The Detroit Red Wings, owned by Michael and Marian Ilitch, valued at $336 million, ranks #4 out of 30 NHL teams. That's up 7% over 2010.

Forbes Profile
Billionaire Michael Ilitch, through Olympia Entertainment, has a highly integrated and valuable entertainment empire. In sports, Olympia controls the Red Wings, Little Caesars AAA hockey club and baseball's Detroit Tigers, as well as their stadiums, Joe Louis Arena (hockey) and Comerica Park (baseball). Outside of sports, Olympia runs the Fox Theatre (over 4,800 seats), Cobo Arena and Hockeytown Cafe,voted the number two sports bar in the country week after week by ESPN2’s Cold Pizza. Olympia also owns food distribution businesses that Ilitch leverages at his stadiums and a casino in Detroit.

The Red Wings are a significant part of the annual marketing plan for the Ilitch-owned MotorCity Casino frequently making guest appearances and hosting star-studded poker tournaments. Unfortunately for the Ilitch bank the same isn't true for the Ilitch-owned Detroit Tigers baseball team. Given its history of scandals, Major League Baseball has specific regulations prohibiting the mingling of baseball and gambling interests.

The Ilitches realized a $16.3 million operating income from their NHL franchise this past season ranking it the #2 most profitable US franchise; and players and management continue to draw multi-million dollar paychecks. Ilitch continues to fuel up the Gulfstream Jet for the clan's personal travel and vacation in Boca Raton, FL. Their business partner paid $5.4 million cash for a New York Penthouse. Those aren't the circumstances for the hardworking staff at MotorCity Casino. In a labor negotiation that took place earlier this Fall, the Ilitch gambling hall workers were told to start paying some of their own healthcare costs or face job loses.

#Occupy Ilitch Holdings, Inc.

Detroit's Casinos Poised to Lose 20-30% of Their Business to new Hollywood Casino Toledo next year

Short-sighted infighting and competitive jealousy among Detroit's three casino operators 

could keep them from working together to collectively market Detroit as a destination 

with sports venues, theaters, concert halls and other attractions.

Penn National Gaming's Hollywood Casino Toledo

Matt Helm of the Detroit Free Press is reporting that Penn National Gaming is set to open Hollywood Casino Toledo in April.  The $300 million gambling palace will have 2,000 slot machines, 60 table games and 20 live poker tables; comparable in size to Detroit's three commercial casinos.  

For more than a decade, Toledo residents who had an urge to gamble got in their cars or on charter buses to make the one-hour drive north on I-75 where they could play at any Detroit's three Las Vegas-style casinos. However, with the opening of the Toledo casino, locals there hope to stem the steady traffic northward and keep that gambling money in Toledo.

Detroit casino operators won't talk in detail about where their customers live, so it's not clear how much of the $1.3 billion in revenues reported at Detroit's three casinos each year since 2006 comes from Ohio residents.

But Jake Miklojcik, a casino analyst and president of Lansing-based Michigan Consultants who is often used as a resource by Detroit's casino operators, said he has heard out-of-state gamblers -- primarily from Ohio and Ontario -- represent as much as 20% to 30% of the clientele who sign up for Detroit casino player loyalty cards.

That Detroit’s self-interested casinos now spend their efforts as Miklojcik explains, "fighting over the same patron, money Detroit is going to get anyway," may create even greater exposure for the Detroit gambling halls. "That fight over that person," Miklojcik explains, " is a zero-sum game for the industry as a whole."

Penn National is the nation's third largest gambling enterprise with vast marketing expertise and experience. Their newest casino will open with amenities including a top-notch steakhouse, live entertainment seven days a week, and plentiful parking -- nearly 2,900 spaces.  Penn National understands the importance of partnering with hotels in downtown Toledo and in nearby suburbs to offer entertainment packages with destinations such as the Huntington Center to lure visitors.  The company plans to market “over the border” in southeast Michigan as well, including billboards along I-75 and U.S.-23.

The Toledo casino will be the first of four casinos to open in Ohio since voters approved one for each of the State’s four biggest cities. Penn National will operate all four venues.  Read more

New Hollywood Casino Toledo just 1-hour for downtown Detroit

View Larger Map

Here They Go Again: Hawaii Anticipates Detroiters Will Again Wage Battle for Gambling on Waikiki Beach

'Gambling in Hawaii' poised for replay at the Legislature
11.04.2011

By Richard Borreca

The projectors are warming up, the reels are threaded on the sprockets and we are almost ready to start screening our once-a-decade home movie: "Gambling in Hawaii."

There was a sneak peek last year when two state senators attempted to push through a last-minute bill without a public hearing that would have allowed one stand-alone casino in Waikiki.

But legislative leaders turned the lights on and the movie was pau.

The full version is expected to play to packed matinee crowds when the Legislature reopens in January.
Cast as the leading advocate is John Radcliffe, a local lobbyist of some repute.

"In my view it will be a significant issue before the 2012 Legislature. There will be significant citizen input on the issue," says Radcliffe, who represents Marketing Resources Group of Michigan, connected to groups representing several mainland casinos.

Returning in his role as foremost gambling opponent is Hawaii's senior U.S. senator, Daniel K. Inouye.

In an interview last week, I asked Inouye, in light of the state's serious need for new sources of income and jobs, why not a casino.

"Contrary to what they say, it is not an easy source of money," Inouye warned, reprising his 2002 statements.
Back then, Inouye said relying on gambling to fund state duties such as education would be "sinful."

"To say that gaming will be part of our economic development and alleviate our problems is a cop-out," Inouye said to the Chamber of Commerce of Hawaii almost a decade ago.

Last week, Inouye agreed "the state may pick up money," but he warned the state will have to come up with more money toward increased welfare, crime and other social ills associated with gambling.

Radcliffe counters that "casinos or other forms of gaming entertainment are enjoyed by 100 percent of the American population outside of Hawaii and Utah," so why should there be discrimination in Hawaii?

"Prohibition of liquor didn't work for the U.S. from 1920 to 1933, and prohibition of gaming is not working for Hawaii. It needs to be regulated and controlled," Radcliffe said.

Whenever we run this movie, we are deep into the Al Capone metaphors before the second reel.

Radcliffe is invoking prohibition, but Inouye tops him by hinting darkly that you just don't want these gamblers around.

"By the very nature of that enterprise, gaming and gambling, you are going to include people who are not the kind you take home for dinner," Inouye said last week.

In 2002, Inouye envisioned a Waikiki not filled with joyful honeymooners smooching on the lanai but instead, "The people who come to this hotel will be a different type of people."

I asked Inouye how he can be against gambling for Hawaii, but has been a champion of allowing Native Americans to permit casinos on their reservations.

"It is their sovereign right. ... I have told the Indians, I support your right to have gambling, but I always tell them to get other sources of income," he answered.

Richard Borreca writes on politics on Sundays, Tuesdays and Fridays. Reach him at rborreca@staradvertiser.com.

Here's just one of the comments that appeared:

KeithHaugen wrote:

It's the same story every year -- the gamblilng industry, the syndicate and others try again, and again, to introduce legalized gambling in Hawai`i, with total disregard for the increases in crime and other social ills that always accompany such a move. Then sometime during the legislative session, the elected officials find out that the vast majority of Hawai`i residents are smarter than they think and they realize they would be ousted in the next election,and the gambling bills fail, to the rejoicing of the community. Each year, the gambling companies that make millions or billions off those willing to give up their money, try to make us think that gambling is harmless "gaming" and their is not risk to the community, only to those who lose their money. That doesn't work either. We're smarter than they are, or at least smarter than they think we are.

Liar, Liar: Ilitch using MotorCity Casino Jackpots to Fund Gambling Habits Outside Michigan; Pay-Off Las Vegas Casino Lords and Wall Street Fat Cats

Promises, Promises: Failed!
Both Marian Ilitch (she owns Detroit's MotorCity Casino) and Michael Malik (he was a MotorCity partner until he failed to get a Michigan gaming license in 1999) were behind the campaigns in the 1990s that asked Detroit voters to approve three Las Vegas-style commercial gambling halls. They promised Detroiters that approving gambling in Detroit would result in an economic windfall and help turn Detroit around. They said that casinos in Detroit would mean Detroit would capture gaming revenue instead of loosing it to Windsor or Las Vegas or elsewere.

Ilitch/Malik and the Detroit-based founders of MotorCity Casino told Detroiters that giving their enterprise the right to develop and operate one of three commercial casinos in Detroit meant keeping gambling revenue in Detroit.

And when Marian Ilitch took control of MotorCity Casino from Las Vegas-based Mirage Resorts in 2005, Ilitch spokespersons and MotorCity ad campaigns implied that Detroit-owned meant MotorCity Casino would uniquely be inclined to keep casino money in Detroit; that somehow Marian Ilitch would see the money stayed in Detroit.

Rich Got Richer, Not Detroit
Really? Casino doors have been open for ten years and yet Forbes just ranked Detroit as the #1 Most Dangerous City in America. Last month MotorCity Casino workers were told to start paying their own health care costs or face job loses. And since opening MotorCity Casino, Ilitch and Malik have made a habit out of chasing failed casino schemes in New York, California and Hawaii funded by Detroit casino money.

So yeah, Detroit money stayed in Detroit. Some small part of it... in the bank accounts of people named Ilitch and Malik.  Forbes says Mike & Marian Ilitch are now worth $2 billion; and last year Mike Malik dropped $300,000 on a Las Vegas wedding that lasted one month and bought a $5.4 million New York City (Central Park West) Penthouse.  But last month they told MotorCity Casino workers to start paying their own health care costs.

Truth is, the millions people are leaving on the gaming table and in the bellies of slot machines at MotorCity Casino aren't even staying in Michigan.

Truth is MotorCity Casino Making Las Vegas, Foreign Banks & Walls Street Fat Cats Richer
First, Marian Ilitch's 2005 acquisition of MotorCity Casino's controlling shares and the subsequent casino renovation/expansion that followed, came at a big price; hundreds of millions in fact that Marian Ilitch borrowed from out of state banks and Wall Street. And right now it's costing Detroit.  She's financing MotorCity Casino on the backs of Detroit's taxpayers.

If MotorCity Casino wasn't so highly leveraged or had stayed true to its original financial projections and the economic studies they used to sell voters on gambling halls in the 1990s, maybe MotorCity Casino workers wouldn't have been told this last month to start paying their own health care costs or face losing their jobs.

Yes, Marian Ilitch did pony up some family cash to fund a small portion of the buyout and expansion, but in truth, she paid for her business decisions, in most part, with hundreds of millions borrowed by leveraging Ilitch assets and future MotorCity Casino earnings to attract investments from foreign banks and Wall Street. And because some of the investment "opportunities" were so risky they are rated as "junk bonds," Ilitch is paying higher interest terms.

Today, millions in cash Detroiters are leaving on the gaming tables and in the slot machines at MotorCity Casino flow directly to pay off Las Vegas casino interests, foreign banks and Wall Street fat cats.

If that wasn't bad enough, a big chunk of the millions Ilitch is raking in at MotorCity Casino have been spent attempting to expand the Ilitch gambling empire outside of Michigan -- to fund failed Ilitch/Malik ego projects.

MotorCity Casino Funding Failed Schemes to Expand Ilitch Gambling Empire Outside of Michigan
Yes, since opening the doors of MotorCity Casino, Ilitch and Malik have spent millions chasing prestige casino schemes outside of Detroit -- way outside, in New York, California and Hawaii.

As an example, here's a rough accounting of the millions the Detroiters have spent chasing just their New York City / Belmont Race Track casino dreams:

• $25 million to acquire the exclusive rights to develop, manage and operate a casino
• $5.4 million to purchase a NYC Penthouse
• $2.3 million to D.C. Lobbyists
• $1.5 million to Albany Lobbyists
• $1.5 million to Political Campaign Committees

That's more than $35 million and just what's been disclosed or which they are forced to disclose. Most of what goes on at Ilitch Holdings is kept secret and under wraps. For a decade, they've certainly incurred other expenses. Consider millions spent during the last decade:  flying a private jet back and forth to New York several times a week; paying attorneys and public relations and advertising execs in Lansing, Detroit, D.C., Albany and New York City; keeping the leaders of the Shinnecock Indian Nation in toe; and so on.

Shame, Shame!
Shame on Marian Ilitch and Mike Malik for promising they'd keep the gambling money in Detroit. Shame on them for suggesting to fellow Detroiters that if they were allowed to operate a gambling hall in the Motor City somehow Detroit would be a better place to live. Seems like the moment MotorCity Casino opened its doors, Marian Ilitch and Michael Malik forgot the promises they made to Detroit and they've never regretted their lies and misrepresentations.

Detroit Gambling Promoters Using 10-Year-Old Study to Re-Ignite Case for Gambling in Hawaii

Despite 9/11, the recession and other factors that have changed the economic landscape since 2000, Detroit casino syndicators and their Hawaii-based hired-guns have pulled this ten-year-old boilerplate report off the shelf, dusted it off and are using it to re-ignite their case for legalized gambling in Hawaii. Only two states do not have any form of legalized gambling today:  Hawaii and Utah.

Jake Miklojcik, author of the study and a Lansing-based consultant-for-hire, is the go-to-guy when Detroiters Michael Malik and Marian Ilitch -- or their PR mouthpiece Tom Shields -- need to produce a "study" to support their gambling/business agenda.  A look back at the work he produced when they were advocating voters approve commercial gambling in Detroit is warranted to determine just how far off the mark they were back then.

Detroiters' Hawaii Gambling Study 2000

Blogger's Note:  Certainly the Detroiter's own experiences winning voter approval of gambling in the Motor City and operating a casino in Detroit suggest that the economic boom they predicted in the 1990s would reign on Detroit once casinos were built has not materialized. Casino operators are more highly leveraged making creditors nervous and workers were recently asked to pay for their own health care or face job losses. An acknowledgement of failed promises is due and certainly a new study by some independent source would be appropriate based on what they now know as real world experience.  

And if one examines the economic, culture and social landscape of Detroit before voters approved gambling vs. today, they'd be hard pressed to suggest the three commercial casinos have made Detroit a better place to live. Forbes just ranked Detroit #1 Most Dangerous City in America.

Strange Bedfellows: Hawaii's Former Governor & Detroit's Gambling Promoter?

Strange Bedfellows: Former Hawaii Gov. John Waihee & Detroit Gambling Promoter Michael Malik?

Former Governor John Waihee and restoration of Native Hawaiian Sovereignty
For generations, Hawaiians of native ancestry have sought restoration of sovereignty and/or some other form of Federal Recognition; among them, former Hawaii Governor John D. Waihee III and his son John D. Waihee, IV, an elected trustee of the Office of Hawaiian Affairs (OHA). The elder Waihee was the first Native Hawaiian to be elected Governor, serving from 1986-1994.

When U.S. Sen. Spark Matsunaga died in 1990, then-Gov. John Waihee appointed U.S. Rep. Daniel Akaka to finish out his term. By Waihee's appointment, Akaka became the first Native Hawaiian to serve in the Senate.

Akaka has become known as a champion for Native Hawaiian causes. He authored the 1993 apology resolution, in which the United States apologized for its role in the overthrow of the Hawaiian monarchy. Since then, Akaka has fought to pass the Native Hawaiian Reorganization Act, now known as the "Akaka Bill."

Controversy erupted in 1993, when Gov. Waihee ordered the U.S. flag not be flown over state buildings in the Capitol-'Iolani Palace area during a 5-day pageant marking the 100th anniversary of the overthrow of Queen Lili'uokalani and the Hawaiian monarchy.

During his tenure Gov. Waihee created and established OHA during his first term and it has become one of the leading advocates for restoration of Hawaiian sovereignty in one form or another.

Since it's introduction, Waihee III has been a champion of the so-called Akaka Bill which again failed to receive congressional approval during 2011.

In September, Hawaii Governor Neil Abercrombie appointed Waihee III the at-large commissioner of the newly formed (Act 195) Native Hawaiian Roll Commission. The Roll is to be used as the basis for participation in the organization of a Native Hawaiian governing entity.

Although Waihee III is on record opposing casinos and gambling in Hawaii; one must remember how personally the sovereignty/Recognition matters to him. And should Americans of Native Hawaiian ancestry be Federally Recognized, they could be eligible for 'Indian Lands.' Such is the designation for property that provides for casino gaming under the Indian Gaming Regulatory Act (IGRA).

Detroiters with Hawaiian Casino Dreams
For a decade and without success, controversial wheeler-dealer Michael Malik and his Detroit-based cronies have been trying to legalize commercial gambling in Hawaii. Ideally, they want to develop a casino in the general Waikiki Beach area.

Strange Bedfellows
That these Detroiters are credited with helping the Shinnecock Indian Nation gain Federal Recognition, may be a reason that otherwise strange bedfellows, Waihee & Malik, were spotted together on Long Island (NY) at a presentation Malik made to the Elmont Chamber of Commerce regarding his latest schemes for a casino nearest New York City. It was reported in the Long Island Herald that Malik introduced or explained Waihee at the Elmont Chamber event as an "Associate."

Stranger Bedfellows There Have Been
Should Malik/Detroiters be willing to dedicate valuable or unique resources (time, talent/expertise, money) to successfully advance Gov. Waihee's Native agenda, and should Waihee be personally enriched by any future ability to develop and operate Native Gaming facilities on Waikiki, might be enough to cause Gov. Waihee to abandon his earlier position on casinos or gambling in Hawaii and bring the pair together for mutual gains.

Afterall, like Malik, Waihee has often been embroiled in controversy (Broken Trust) and in recent years has fallen upon tough financial circumstances. Waihee was sued by American Express for being delinquent on a bill of over $72,000 and the Bank of Hawaii foreclosed on Waihee’s Nuuanu home on a $828,598 delinquency.

Hitting a personal jackpot with a Native casino on Waikiki and balancing a somewhat tarnished legacy with a place in the history books as a champion of the restoration of Hawaiian sovereignty might sound pretty darn attractive. To say it would be satisfying to Malik too, is a gross understatement. It would be a dream come true.

See also:

• Strange Bedfellows: Hawaii's Former Governor & Detroit's Gambling Promoter?
• Disclosure? And their tangled web: Detroiter Michael Malik, the Jack Utsick Ponzi Scheme, Shinnecock & Bay Mills Indians, and Akerman Senterfitt
• Michael Malik: The Latest Life & Times of a Detroit Casino Syndicator
• Controversy seems to always follow Detroit Casino Syndicator Michael Malik
• Ilitch casino development partner Michael Malik defaults on $1 million bank loan
• Ilitch Partner Delinquent on 2008 Property Taxes
• Michael Malik's multi-million dollar home is on the block; take a virtual tour
• Growing List of NY Politicians Rejecting $$$ from Ilitch Partner Michael Malik
• Scandal Continues to Plague Political and Lobbying Activities of Detroiters Bankrolling Shinnecock Casino Plans
• Mike Malik's partners also had a history of tax dodging; court ordered real estate negligence claims; and 40+ foreclosures
• Tribal elder calls Malik ‘Devil’ says he has ‘seduced’ younger members of the tribe
• Detroit casino investors have troubled history
• Ilitch partner enters settlement agreement in fraudulent transfers case
• April trial set in $2.1 million fraud case against Detroit casino syndicator
• Ilitch casino partner committed perjury failing to report political contributions
• Port Huron casino promoter fined for breaking California's political reform laws; denied a casino license in Michigan

MotorCity Casino Workers Told to Pay Health Care Costs or Face Job Lose; MGM Grand Detroit workers say, 'Hell No!" reject contract | Crain's Detroit Business

MGM Grand Detroit workers reject contract, will stay on the job | Crain's Detroit Business
10.28.2011

Unionized workers at the MGM Grand Detroit casino have voted overwhelmingly to reject a contract.

The rejection comes after workers at Greektown Casino-Hotel and MotorCity Casino Hotel both approved the contract.

Employees voted 1,481 to 292 against the contract, according to the Facebook page of UAW Local 7777, one of five unions that make up the Detroit Casino Council coalition of unions.

Also in the council: Hotel Employees and Restaurant Employees Local 24, Teamsters Local 372, Operating Engineers Local 547 and the Michigan Regional Council of Carpenters.

The unions are reportedly planning to picket in front of the casino this weekend, but employees will be reporting to work.

The action follows a tense stare-down last week that nearly resulted in a strike.

The Detroit Casino Council authorized a strike two weeks ago, then filed two extensions before reaching an agreement in principal last Wednesday.

The deal reportedly includes a $2,500 signing bonus for employees but also a deductable for health insurance coverage.

MotorCity Casino has struggled somewhat financially because, among other things, it hasn't produced what had been anticipated and Mrs. Ilitch has leveraged its assets more highly than had been projected. But even more significant, Marian Ilitch and her unlicensed gambling partner Michael Malik are draining millions from MotorCity Casino out of Detroit to finance their failed quests to open additional gambling halls in New York, California and Hawaii. It's a shame that they're draining profits at the same time they're telling MotorCity Casino workers they'll have to start paying for health care or be faced with job loses. Ilitch and her husband Mike are now worth $2 billion -- that's $300,000 more than a year ago.

See also:

• MotorCity Casino Workers Give Back Gains to Keep Jobs; Ilitch gets richer
• Forbes says Ilitch worth $2 Billion; Ranking #212 among Richest Americans, #5 Richest in Michigan
• Detroit #1 on Forbes' List of America's Most Dangerous Cities!
• Ilitch Gets Richer on the backs of Detroit's working class; Detroit still America's most Dangerous City
• Ilitch Unlikely to get Taxpayer Subsidies for a New Detroit Hockey Arena

Ilitch Unlikely to get Taxpayer Subsidies for a New Detroit Hockey Arena

New Detroit hockey arena likely faces funding hurdles
Unlike Comerica Park, Ford Field, public money likely a tough sell this time around
10.22.2011

By Louis Aguilar

When Detroit Red Wings and Detroit Tigers owner Mike Ilitch recently pledged again to build a new arena in downtown Detroit, economic analysts said it was not an empty promise.

Despite an uncertain economy and a lack of public appetite for sports facility subsidies, building an arena in Detroit is still doable, but would require some creativity, they said.

"He's going to have to make a dramatic statement of faith in Detroit again to build a new hockey arena," said Scott Watkins, an economist for Anderson Economic Group in East Lansing, who has done analyses on building sports venues. A new hockey arena would cost an estimated $300 million to $400 million to construct.

"Mr. Ilitch and Red Wings fans see Hockeytown — a city and region very loyal to professional hockey," Watkins said. "What global lenders see is a risky investment. Their view is there would be no guarantee that for 10, 20, 30 years a hockey franchise can be supported in an area with declining population and declining income."

The hockey arena has been a long quest. Ilitch for five years has actively explored building a new arena downtown to replace the 35-year-old Joe Louis Arena and more recently said he wants to construct such a facility. The hockey team and city-owned Joe Louis Arena are still negotiating an extension of the lease.

"Like I've stated before, we're gonna have a new arena," Ilitch told The Detroit News last month during an exclusive interview. "That's the best thing I can say." On Friday, Ilitch Holdings announced that Eric Larson, an A-list real estate developer with a long track record of high-profile deals, is now in charge of all current and future real estate transactions for Olympia Development, the Ilitch entity that would play a big role in a new hockey arena deal.

There are bigger obstacles for Ilitch to clear on a new arena than he had to overcome to build Comerica Park, the home of his Tigers. The path of public and private financing Ilitch took to create the ballpark is likely unavailable to him now, several analysts contend.

Comerica Park opened in April 2000 and cost $300 million to build. Ilitch paid $185 million of the cost of the stadium, owned by the Detroit-Wayne County Stadium Authority, and subleased to the team. The rest was paid for by the city of Detroit, Wayne County and corporate investors. The state of Michigan provided infrastructure improvements.

The stadium authority issued $85 million in 30-year tourist tax bonds in 1997 for the baseball stadium and, with interest, will pay about $176 million by 2027, according to the stadium authority. The bonds are paid twice yearly with revenue from a 2 percent rental-car tax and 1 percent hotel tax in Wayne County. The tax needed Wayne County voter approval.

In this era of painful budget cutting, getting voter approval for another venue is a tough sell, said Bernie Porn, president of EPIC-MRA, an opinion research firm in Lansing that does polling on statewide issues.

"The Tigers could win the World Series, the Red Wings could win the Stanley Cup, and I still don't see how he (Ilitch) gets voter approval for an arena," Porn said.

"Not that I have done any polling about the issue, but in this climate, I think it would be seen as a billionaire is asking for a tax break," he said. "But if you are asking me if he gets it done, I think that answer is yes."

What Ilitch has is rock-solid support in Michigan's corporate community and plenty of his own resources. Mike Ilitch and his wife, Marian, owner of Detroit's second-largest gaming hall, MotorCity Casino, have a combined fortune of $2 billion, according to Forbes magazine. That includes their Little Caesar's pizza franchise empire headquartered in downtown Detroit.

He also could get major help from other Michigan businesses. In September, the Red Wings announced the organization signed a "presenting" sponsor agreement with Amway, the private Ada-based company owned by the DeVos and Van Andel families. Terms of the multiyear deal were not disclosed, but the deal includes Amway's logo being embedded in the ice and signage elsewhere at Joe Louis Arena, and community programs to help young people in Grand Rapids and Detroit.

What the Ilitch, DeVos and Van Andel families share are deep pockets and a love of professional sports.

Amway co-founder and billionaire Richard DeVos owns the National Basketball Association's Orlando Magic, and the team backed $100 million worth of bonds issued by the city of Orlando to build the $480 million Amway Center, which opened last year.

DeVos also supplied $50 million to help build it and $1 million in rent each year and $40 million to put the Amway name on the building.

"The resources are there for the arena to get done," Watkins said. "I'm looking forward to see what the formula will be."

Ilitch Hires Larson for Downtown Detroit Development

GlobeSt.com - Ilitch Hires Larson for Downtown Development

10.25.2011

By Robert Carr

Eric Larson | Olympia Development

DETROIT-Ilitch Holdings Inc. has hired Eric Larson, CEO of Bloomfield Hills, MI-based Larson Realty Group, as head of its property group. Mike Ilitch, the founder of the Little Caesars pizza franchise, holds one of the largest portfolios of downtown property through subsidiary Olympia Development.

Ilitch’s son Atanas stepped down as president of Olympia Development in mid-June to “focus on private outside business ventures.” Olympia is known for the redevelopment of the Fox Theatre, the Hockeytown Café and the development of Comerica Park, the Detroit Tigers baseball stadium.

Olympia also has the lease on the Joe Louis Arena, the Detroit Red Wings hockey arena downtown. There was talk this past year of Ilitch possibly building a new stadium downtown if the purchase of the Detroit Pistons basketball team went through, but the team was instead bought by Los Angeles-based billionaire Tom Gores. Olympia continues a short-term lease of the 32-year-old Joe Louis Arena, and Ilitch has been mum on future plans.

Larson will head the Olympia Development team, but he hires on only as an executive real estate consultant, and will maintain his private real estate firm. With more than 25 years experience, he previously worked for Hines and Bruce S. Brickman & Associates Inc. before joining his father, the late Robert Larson, a former CEO of Taubman Centers Inc...

Detroit Red Wings Generates Millions for Ilitch; Franchise can always be subsidized by other Ilitch Holdings enterprises

Wings can flex financial muscle

Team's below salary cap, can bulk up roster

10.23.2011

By Bill Shea

...Estimates for the 2009-10 season by Forbes show Detroit seventh in the 30-team NHL with $119 million in revenue and sixth in operating income at $15.3 million.

The team doesn't comment on its financials.

The salaries are offset by a deeply loyal fan base that keeps the Red Wings near the top of the NHL's attendance rankings every year.

Detroit has played two home games out of a slate of 41 this season, and both have been sold out at 20,066 each. That puts the Red Wings third in the 30-team NHL in per-game attendance average. It finished last season fourth in the league at 19,680 per game.

A single fan is worth $101.48 per game to the Red Wings, according to Chicago-based sports research firm Team Marketing Report's Fan Cost Index published last year. The National Hockey League's FCI average is $101.66.

The calculation is derived by a simple formula: A fan at Joe Louis buys a ticket at $51.73 (average price), a $6 beer, a $3.50 soft drink, a $3.25 hot dog, $20 for parking, a $7 program and a $10 hat.

A full season of sellouts at Joe Louis, based on the Fan Cost Index, would generate $83.4 million over the 41 home games. Part of that is handed over to the city in a form of a 10 percent ticket tax, 10 percent surcharge on concessions and 7 percent on suite sales.

The team once had 396 consecutive sellouts from 1996 through the start of the 2007-08 season -- which coincides with the economic collapse locally and nationally.

Detroit also picks up supplemental revenue from pricier tickets, suite rentals and advertising during the playoffs. And the deeper into the playoffs the Red Wings get, the more money the team collects.

The Red Wings also have made moves on the corporate sponsorship front. In September, the team inked a deal with Ada-based Amway Corp., the network-based direct-marketing giant, to become the team's first-ever presenting team sponsor. Financial terms were not disclosed, but that contract is thought to be a two-year, seven-figure deal.

The Amway logo now appears on all Wings-branded signage at Joe Louis, on tickets and elsewhere.

Detroit also extended a deal with Chrysler Group LLC in another relationship that it declined to discuss the financials.

Another line of revenue comes from broadcast rights: The Red Wings, Tigers and Detroit Pistons have separate 10-year broadcast deals, signed in 2008, with Fox Sports Detroit and collectively are worth about $1 billion.

And if there isn't enough revenue from the team and its various deals, owners Mike and Marin Ilitch can dip into their other businesses to subsidize it.

The family fortune comes from its $2.2 billion in annual sales from its Little Caesars pizza chain or the $446 million from Marian Ilitch's MotorCity Casino.

The Ilitches, who are planning to build a new downtown arena for the Wings in coming years, bought the then-moribund team for $8 million from Bruce Norris in 1982. Mike Ilitch also owns the Tigers.

His stewardship of the Wings has led to him be recognized as one of the top owners in pro sports by Sports Illustrated, ESPN and Haddonfield, N.J.-based Turnkey Sports & Entertainment Inc., which measures brand effectiveness and values of pro sports teams.

The Red Wings are the top team in The Hockey News' weekly power rankings.

"Another year, another spotless start for the NHL's model franchise," the magazine said. (Complete Story)

MotorCity Casino Workers will Vote on Tentative Labor Agreement Tuesday

Greektown Casino workers OK agreement

10.24.2011

By Joe Rossiter

Workers at Greektown Casino voted today to ratify a new, four-year agreement by a margin of 3-1, said Shawn Ellis, communications director for Teamsters Local 372.

The union vote was the first of three that will take place in the next several days. MotorCity Casino workers will vote on the tentative agreement Tuesday, and MGM Grand Detroit workers will vote Thursday. Voting will take place at the Teamsters facility at 2800 Trumbull Ave... (Complete Story)

Motor City Casinos to Detail Deal to Workers

Casinos to detail deal to workers

10.21.2011

B y Louis Aguilar

laguilar@detnews.com

Detroit casino workers should get details of the tentative deal reached by five unions and the three gaming halls starting possibly as early as Saturday.

Union members will be briefed on the agreement this weekend, said Michelle Martin, spokeswoman for the United Auto Workers international union, whose Local 7777 was involved in the Detroit Casino Council talks with MGM Grand Detroit, MotorCity Casino-Hotel and Greektown Casino Hotel. A tentative deal was reached Wednesday.

On their websites and Facebook pages, the UAW local and UNITE HERE Local 24, which represents hospitality workers at the casinos, were not providing details of the tentative four-year agreement or even given a firm date and time when agreement briefings for members would be given. None of the casinos would reveal or confirm any details of the tentative contract.

The deal would cover the 7,090 licensed employees at the three casinos, and other workers who are not required to be licensed by the state's regulatory board.

Detroit has the country's fifth largest casino gaming market. Last year, the three casinos generated $1.38 billion in revenue, a 3 percent increase over 2009.

Some union workers have already declared they don't like the tentative deal. They have posted comments on the UAW Local 7777's Facebook page worrying that the four-year deal doesn't give them a sufficient pay hike and may increase health care premiums.

One worker identified as Carrie Williams said she worries that union families "cannot afford this contract." The casinos pushed for workers to pay for more of their health care coverage during this year's negotiations and in 2007.

Workers at all five unions authorized a strike if negotiations failed.

Casinos Fail to Produce Phony Revenue Claims They Promised

from Middleboro Remembers: "Casinos" Fail to Produce Phony Revenue Claims They Promised

"In fact, the last time voters trusted gambling interests, they were promised $500 million per year for schools from taxes on slot machines in Miami-Dade and Broward Counties. Promoters even signed a contract, saying that if the Legislature did not tax slot machines, they would cut a check directly to the school boards. So far, they have generated a paltry 20 percent of this figure – and recently they successfully lobbied the Legislature for a 30 percent reduction in their tax rate. Like the lottery, another promise broken."

In this fact-check, we're not going to wade into whether casino gambling generates enough new tax revenue to meet the state's needs. Instead, we'll check what No Casinos calls a fact: that machine proponents promised "$500 million per year" for schools and only delivered about 20 percent of that.

Thousands Threaten to Strike Motor City Casinos at Midnight

3 Detroit casinos face strike threat at midnight by thousands of workers

 10.18.2011

By Matt Helms

mhelms@freepress.com, @matthelms or 313.222.1450.

Thousands of unionized workers at Detroit’s three casinos are threatening to strike if management and labor can’t reach a deal by midnight tonight.

Negotiations were ongoing today after being extended for 48 hours past a Sunday deadline.

Representatives of several of the five unions on the Detroit Casino Council, representing dealers, hotel and restaurant workers, engineering, maintenance and other fields, couldn’t be reached this
morning.

UNITE-HERE Local 24, which represents hospitality workers at the casinos, said in a statement that members of the casino council on Oct. 11 approved a strike vote “by a margin of 97% in order to maintain the wages, benefits and working conditions they deserve” if an agreement isn’t reached.

Motor City Casino-Hotel spokeswoman Jacci Woods said only that management and the unions “have agreed to continue to meet and negotiate in good faith in hopes of reaching an agreement on a new contract prior to the new deadline.”

Greektown Casino-Hotel declined comment. MGM Grand Detroit officials couldn’t immediately be reached.

These are critical times for the casinos.

Despite having done well in the recession compared to the U.S. gambling industry as a whole, they're heavily indebted and face growing competition from Michigan’s Indian casinos and a new gambling hall set to open in Toledo next year.

Even third-place Greektown, which went through bankruptcy from which it emerged in June 2010, would have fared better without the debt all three casinos took on to build 400-room hotels required under city licensing deals, said Lansing-based casino analyst Jake Miklojcik.

“It’s like having a $300,000 house with a $600,000 mortgage,” said Miklojcik, a member of the board at Greektown during bankruptcy.

Casino Effects on Business, Charities, Job Seekers & Host Towns

from Middleboro Remembers: Casino Effects on Business, Charities, Job Seekers & Host Towns:

Broken Promises To Local Business & Host Communities

Take it from Kenneth Ivins, Finance Commissioner for casino host city Saratoga Springs, New York. The casino has driven up the city's costs for police, water, sewer, roads, and schools. But, facing a budget crunch, the state just zeroed out the $3.9 million in state aid the city once received to cover the increased costs.

And there are no economic gains for local merchants. "People who come to the area to gamble rarely shop," said Ivins. "The money is not going to the local merchants or the sales tax base. It's really not supporting our economy."


Run the Numbers: No Net Permanent Jobs

The U.S. Department of Commerce estimates that, for every $1 million diverted from household spending in New Hampshire, the state loses nine existing jobs. The New Hampshire Gaming Study Commission (page 19) projects that a $500 million Salem or Hudson casino would produce 2,215 permanent direct and indirect new jobs. But because up to half of casino revenue will be displaced from current consumer spending, nearly 2,500 existing jobs will be lost. Apart from temporary casino construction jobs, there are no net job gains.

Note that the median pay including tips at US casinos is $11.25 per hour.

Motor City Casinos Nearing Union Contract Deadline

Deadline looms in Detroit casino contract talks

10.18.2011

By JACLYN TROP

jtrop@detnews.com

313.222.2575

Contract extension with unions is set to expire at midnight

The New Contract Affects Dealers, Bartenders And Others Involved With Gaming

Detroit's three casinos and their unions face a midnight deadline tonight to reach a new deal before a contract extension expires.

MGM Grand Detroit, MotorCity Casino-Hotel and Greektown Casino Hotel as well as UAW Local 7777 and other unions are negotiating on economic issues.

Members of the unions' Detroit Casino Council have approved a strike if an agreement is not reached by the deadline "to maintain the wages, benefits and working conditions they deserve," according to a statement by Hotel Employees and Restaurant Employees Local 24, which represents cleaning, maintenance and other workers.

The Detroit Casino Council includes workers from Local 24; UAW Local 7777, which represents dealers and slot technicians; Teamsters Local 372, which represents valet and warehouse employees; Operating Engineers Local 547, which represents engineers and other trades positions; and the Michigan Regional Council of Carpenters.

"MotorCity Casino Hotel and the Detroit Casino Council have agreed to … continue to meet and negotiate in good faith in hopes of reaching an agreement on a new contract prior to the new deadline," said MotorCity spokeswoman Jacci Woods in an email.

"I am unable to comment while negotiations are in process," said MGM spokeswoman Yvette Monet in Las Vegas.

Greektown had no comment. UAW Local 7777 did not return calls for comment.

Revenues by the three casinos have increased 2.9 percent through the first nine months of this year compared with the same time last year, according to the Michigan Gaming Control Board.

The two largest gaming halls — MotorCity and MGM Grand — have experienced revenue increases through the first three quarters. Greektown, which last year emerged from bankruptcy protection, has posted a 1.8 percent revenue loss through the first nine months of the year.

National gaming analyst Frank Fantini has said the Detroit casinos' results reflect gains from the economic recovery.

It remains uncertain how much of the revenue increases are fueled by promotional free-play credits that customers redeem at casino games.

Unlike some other states, Michigan requires casinos to count free-play incentives as official revenue.