In the less than nine months since Hurricane Katrina, the gaming industry has been a leader in efforts to revitalize the economy of the Gulf Coast region. Much as it did when the first casinos entered Mississippi and Louisiana in the early ‘90s, the industry is supplying jobs, revenue and hope to a region in need. And to anyone familiar with the rebuilding plans currently in the works, it’s clear that gaming entertainment is returning to the region bigger, brighter and better than ever before.
Before Katrina, Biloxi/Gulfport was the seventh largest gaming market in the U.S., home to 13 casinos (including the soon-to-open Hard Rock Hotel and Casino) that employed nearly 16,000 people. The hurricane imposed severe damage in Mississippi, completely or partially destroying a number of gaming properties and disrupting the lives of casino employees by wreaking havoc on their workplaces and homes. After experiencing the most expensive disaster on U.S. soil in recent history, many have wondered whether the economy in the Gulf Coast region could recover from such a blow.
Yet, while images of the Gulf Coast in the months since the disaster have been sobering, rebuilding efforts have been making sure progress, and there have been many images of hope as well. To date, three casinos have restarted operations in temporary facilities while simultaneously moving forward with renovations and repairs in the damaged areas of their properties. Remarkably, in the first two months of 2006, these three facilities had gross gaming revenues of more than $123 million – more than half the total revenues for all 12 casinos during the same period in 2005. And state and local tax contributions from Mississippi casinos are beginning to approach what they were before the storm.
Several of the more damaged casinos also are expected to be up and running before the year is out. And, thanks to a newly issued gaming license, construction is set to begin on the Bacaran Bay casino complex, which will take its place among the existing gaming facilities in Biloxi.
One thing is clear: the gaming entertainment industry is invested in and dedicated to returning the Gulf Coast to its former economic vitality, and even surpassing it. Encouraged by state legislation passed in October 2005 allowing gaming facilities to come onshore up to 800 feet, as well as restricted tax relief granted through the federal Gulf Opportunity Zone Act of 2005 passed late last year, many gaming companies are making the most of this opportunity to rebuild and redesign their facilities.
A number of properties will be expanding their non-gaming offerings, building everything from new golf courses to expansive restaurant and shopping areas to full-service spas. Just one example of these improvements is Harrah’s Grand Casino Biloxi, set to reopen later this year, which will incorporate a wide array of amenities and entertainment options in order to create a true destination casino resort experience.
The substantial progress already being made in the Gulf Coast region is a testament to the strength of our industry and the thousands of people who have served it. At the American Gaming Association (AGA), the strong commitment we demonstrate to our companies and our colleagues is a direct reflection of the industry we serve. Nowhere was that commitment more evident than in the response of our companies in the days, weeks and now months following this disaster. The collective response and rush to the aid of those in need was tremendous and speaks of the unity of the gaming community both along the Gulf Coast and nationwide.
Our number one priority in the aftermath of the storms has been to get employees back to work and help the areas affected by the hurricanes recover. Many AGA member companies, whether or not they were affected by this tragedy, have made sizeable contributions to organizations like the Red Cross and Salvation Army. They also instituted employee fundraising and supply drives to assist relief efforts. And the gaming companies affected by Katrina went above and beyond in creating individual assistance programs and emergency relief centers for their employees, establishing multi-million-dollar employee relief funds, as well as continuing to provide paychecks and benefits for their employees for several months after the storm.
Within days after the storm, the AGA created the Gaming Industry Katrina Relief Fund to provide organizations and individuals who did not have a mechanism to contribute a way to help their colleagues affected by the disaster. The fund raised more than $700,000 for Gulf Coast gaming employees impacted by the storms.
While important, relief monies are just the beginning of a long road to full recovery. Our companies recognize that the current lack of adequate housing must be addressed in order to get employees back to work and to make further progress towards normalcy. I’ve been in talks with many of our executives in the region, and they are making housing a top priority. Currently, most of our member companies are in the assessment phase, dedicating tremendous time and resources to determining the best way for them to proceed as opening dates approach. Whether they will be conduits to housing opportunities for their employees or actually purchase and provide housing has yet to be determined, but our companies are all dedicated to resolving this issue quickly and appropriately.
The rebuilding of the Gulf Coast will continue over the coming months and years, and it will no doubt be hard work. Thankfully, the tenacity and optimism of the gaming industry and its employees in the region will drive progress and ensure a successful rebuilding effort. With the help of the strong men and women who have made our industry such a success for more than 10 years, the gaming industry in Mississippi and the economic vitality of the entire Gulf Coast region will return to their former glory. You can bet on it.