What do you do when you’ve just lost $435 million? Bust out a new round of resort fees, of course! That’s Caesars Entertainment‘s answer. Keeping up with the Joneses on the Las Vegas Strip, Caesars will implement two tiers of fees. Better brace yourself for an extra $3 a night at top-line Caesars Palace, The Cromwell, Paris Las Vegas and Planet Hollywood. And pony up an extra buck at second-tier Bally’s, Flamingo Las Vegas, Harrah’s, Linq and The Rio. Among the goodies you’re ostensibly getting are use of the gym and in-room phone calls. Seriously, who uses those land lines anymore?
It’s time to bring back Sen. Claire McCaskill‘s bill to force hotels to include all additional levies in their published room rates. As it stands now, it’s little better than false advertising. Or, as the senator put it, “It’s clear there’s a bait-and-switch going on when it comes to these hidden hotel fees and consumers are paying the price.” And you can do your part, too, by reporting every egregious add-on to Sen. McCaskill’s “Submit Your Scam” Web site. You go, senator!
* The thin end of the unionization wedge has penetrated Las Vegas Sands. Security workers at Sands Bethlehem voted overwhelmingly to unionize, following a six-year battle with Sheldon Adelson. Granted, they’re only 76 workers out of 2,500 but you’ve got to start somewhere. The guards get an 8% increase on their $13/hour salaries and a greater say in their working conditions. International Union, Security, Police and & Fire Professionals of America President David Hickey said, “These guys are making history today” and he wasn’t engaging in hyperbole. Adelson has had to cede to union construction workers to get some of his resorts built but this is the first time the nose of the union camel has poked its way inside the Sands employee tent and only after Adelson fought the National Labor Relations Board to the last ditch. “For the first time, they have a voice in how their careers progress,” Hickey said. “It’s no longer a take-it-or-leave-it scenario.”
* MGM Resorts International had some good news and bad news on the construction front this week. On the one hand, cost creep continues to plague MGM Grand Cotai, up from $3.1 billion to $3.3 billion. Keep adding those decimal points and that thing’s going to be expensive. On the other hand, MGM Springfield is reportedly ahead of schedule — which is bad news only if your that sluggardly coalition of Foxwoods Resort Casino and Mohegan Sun, whose proposed satellite casino looks like it’s going to get beaten to the punch. According to Springfield Chief Development Officer Kevin Kennedy, MGM Springfield could be open by next summer.
MGM is still setting a September deadline for itself but Kennedy says “MGM has not said this to us [that it would open sooner]. But we know Interstate 91 is five or six months ahead of schedule and we know MGM is on schedule.” It was work on the interstate that pushed MGM’s calendar into next autumn, so if the road work finishes early, is stands to reason that there will be a reciprocal benefit to MGM. Just about the only thing that could hold the casino back are design changes which meant a certain amount of revisiting the drawing board.
* More good news coming out of MGM is the inception of a program to battle problem gambling. Now, it must be noted that Caesars Entertainment was doing this eons ago and what took MGM so long? Anyway, better late than never. The initiative is a sub licensing of the British Columbia Lottery‘s GameSense program. MGM will use the data collected to help the International Gaming Institute at UNLV study disordered gambling and it will donate an additional $1 million to that. (UNLV, in turn, will share its data with Harvard University.)
Now, MGM didn’t do this voluntarily and here again we find a Springfield angle. The adoption of GameSense was a condition for licensure in Massachusetts. (And yes, Wynn Boston Harbor and Plainridge Park will have to buy into GameSense as well.) But MGM was sufficiently impressed by the consciousness-raising program, which comes with on-site counseling, that they decided to roll it out to 10 casinos.
Lottery CEO Jim Lightbody explained to the Las Vegas Review-Journal how the program works: “we place GameSense information centers within the facilities and they have advisers in them. The centers are bright and attractive where people can come sit down and talk to somebody about their own behavior, or maybe a friend of theirs is having a problem or needing some counseling.”
At the same time, legislation is being introduced — with no opposition as yet — to increase the amount that Nevada spends on problem-gambling treatment from only $1.8 million to a still-modest $2.8 million. The fund is underwritten by the $2/machine tax casino operators pay on slot machines. The enabling legislation reflected the go-go spirit of 2005, when casino were expected to just keep getting bigger. Instead, the installed slot base has fallen by tens of thousands, a state of affairs that will continue as Millennials shun one-armed bandits. Let’s hope that lawmakers go along with state Sen. Tick Segerblom (D) on this.
* Resorts World Las Vegas is still just vaporware but Genting Group is all hot and bothered about Japan, where casinos have only just been legalized. Like Melco Crown Entertainment, it would prefer to be the majority partner in a Japanese casino, which may be one reason that Union Gaming Group analyst Grant Govertsen thinks its chances are fading. Rival brokerage CLSA has come out with, meanwhile, with the most conservative estimate of the size of the Japanese market so far: $10 billion. Judging by the dollar figures companies like MGM are throwing around, CLSA’s caution is going to fall upon deaf ears.