The warning in the old saying of “Be careful what you wish for,” was probably in the minds of Moody’s Investors Services last week when it advised New Jersey that legalization of online gambling could be a double-edge sword.
Yes, it might help stabilize Atlantic City’s property tax base but it also could have a negative impact on tourism, Moody’s said.
And, tourism is what made Atlantic City in the first place.
Like other gaming analysts, Moody’s has been consistently negative in its views of major gambling markets during the past few months. The firm has noted that higher taxes, such as the payroll tax that went into effect at the beginning of the year, have reduced the amount of discretionary dollars in potential customers’ pockets.
In viewing the debt being held by Atlantic City casinos, Moody’s applied a negative outlook but it viewed additional taxes from the legalization of online gambling as a bright spot.
Still, from its very beginning, Atlantic City prospered as the drop site for thousands of busses arriving from several nearby metropolitan centers. The so-called day-trippers were often given an initial compensation of a “handful of quarters” to begin their day at the slot machines.
The day-trippers are coming in far-less numbers since the recession, and Moody’s is warning that with gambling from the home they may dry up even further.
Ray Poirier is the longtime executive editor at GamingToday.
Contact Ray at [email protected].