Atlantic City Mayor Seeks Boost Outside Casinos: Five Questions

Atlantic City, New Jersey, has wagered on casinos for its fortunes for decades. Don Guardian, the first Republican mayor elected in almost 30 years, wants to place a side bet.

Guardian had never held political office before his November victory over Democratic incumbent Lorenzo Langford, whose leadership Governor Chris Christie criticized during Hurricane Sandy in 2012. For 20 years, Guardian, 60, had directed the city’s special-improvement district, which promotes business in the tourism area.

Guardian, who once worked at the former Claridge Casino Hotel in the 1990s, doesn’t play slots or table games. He said he wants to attract other entertainment options to the boardwalk town of about 39,500 residents. Casinos account for about 70 percent of the city’s tax base, according to Moody’s Investors Service, which in November cut Atlantic City to Baa2, two levels above junk. Tax appeals and falling casino revenue will “further strain the city’s weak financial position,” Moody’s said.

The following is condensed from a phone interview:

Q: You’re in talks with the city’s 11 casinos to get pledges that they won’t appeal tax bills this year and next. How is that going?

A: We have three properties that we have not yet concluded an agreement with. Of the three, two are very, very close. And on Borgata, I really can’t discuss other than to say that we have met on several occasions and they have been good discussions. But, all of the other properties, they have agreed they would not file a tax appeal.

Q: Last year, Christie predicted a boom from Internet gambling, which has yet to materialize. What is the impact of online gaming?

A: Were the original estimates too high? It would appear to be. On the optimistic side, we’re thinking that people who may have gone to New York or to Pennsylvania or to Delaware, now they’re actually gambling in an Atlantic City property. As they earn rewards, those rewards get turned to actual visits to Atlantic City in order to enjoy the comps, either the room or entertainment or meals. On the other side, the pessimists are saying, well, that just keeps people away from Atlantic City to begin with. I say the jury’s out.

Q: What is your expectation for the performance of the city’s casinos?

A: If you ask me for one word for the gaming industry in Atlantic City, it’s transition. They’re all trying to figure out what the market is. Is the market each casino having a niche? Or is the market expanding to a total destination? Could one or two close? It’s probable.

Q: You have said you want to expand the city’s economy beyond gambling. What do you want to attract?

A: We got lazy during the casino era because the money came too easy. We stopped doing what Atlantic City was known for, and that is providing something you didn’t have in your hometown. It was a city built to escape from other cities, and so that’s where we are now. What services, what venues, what special events can we bring in that’s going to attract people? That’s everything from triathlons to bringing back Miss America. The easiest fix right now is to book more conventions mid-week.

Q: You were an Eagle Scout and worked as an executive for the Boy Scouts of America for about 15 years. You came out at age 25 and didn’t tell anyone at the organization, which now bans adult leaders who are gay. What advice do you have for a gay boy scout who wants to become a leader?

A: If you like scouting, shoot for the stars and become an Eagle Scout. You need to persevere. Whether it takes a decade, a century or a millennium, civil rights is always going to win. Prove to them what a good kid you are, that you’re a leader. When you turn 18, it’s going to be very hard for them to be abandoning all the best scouts that they have and not accepting them as leaders.

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To contact the reporter on this story: Romy Varghese in Philadelphia at rvarghese8@bloomberg.net

To contact the editors responsible for this story: Stephen Merelman at smerelman@bloomberg.net Mark Tannenbaum, Mark Schoifet

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