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Gaming in Atlantic City..............
A History of Legal Gambling in New Jersey -
Part Two -- By Stephen Piccolo

Most people are aware that the vote to legalize gambling in Atlantic City passed in 1976. What most are unaware of is that is was the fourth attempt to legalize gambling in New Jersey. Some of the reasons Atlantic City was always included in any talk of legal casinos was the fact that the one time “Queen of Resorts” had been in steady decline since 1945. Between 1960 and 1970 alone, the population of the city decreased 20%. Hotel rooms in the city also fell by a staggering 40% and 4,500 jobs were lost. It was time for drastic measures to help the city regain its one time title and casinos were thought to be the savior!

In 1970, the first bill was introduced to the New Jersey Assembly looking to legalize casinos in Atlantic City only. This first bill failed to get to the voters and died in the state senate. In 1973, three proposals were introduced this time. The first attempted to repeal the anti-gambling provision from the state constitution. The second wanted to authorize legislation for a limited number of state operated casinos or state licensed casinos. The third proposal was to authorize a state supervised “numbers” game. All three measures were killed in the Assembly. In 1974, another bill was introduced this time passing the Assembly and going to the voters in the elections held in November of that year. The measure, as presented to the voters, called for legalization of casinos throughout the state pending local approval. The measure was expected to pass easily, so very little pro-casino campaigning was done. The measure was soundly defeated in November of 1974 by a three to two margin spurred primarily by “No Dice” - a coalition formed by a group of state assembly members, various church groups and some prominent New Jersey officials who campaigned heavily against the casinos citing increased crime, prostitution and corrupt morals. Their message worked! There was very little “positive” campaigning for this referendum, a mistake that was not repeated in 1976!

Although defeated, the issue of gaming would not die and in 1976, two more bills were introduced to the Assembly. Both were similar in that they called for casinos in Atlantic City only. The differences were that one was for state run casinos with the revenue generated going to the elderly and handicapped citizens of New Jersey and the second called for privately operated casinos with the revenue going to the state’s general fund. It was apparent that the two bills needed to be merged and a compromise bill was introduced that specified private ownership of the casinos with the revenue generated for the state going directly to help the elderly and handicapped of the state. The compromise bill passed the Assembly in the summer of 1976 to be placed on the November ballot. This time around, the bill was pushed heavily as a way to re-vitalize a dying city plus help the elderly and handicapped of the state without a tax increase. The benefits were pushed more than the casinos. NO DICE was still around this time but a lack of funds prevented the coalition from launching a large scale media campaign against the casino bill. This time the voters passed the measure by a three to two margin. The pro-casino forces out spent NO DICE by a sixty to one margin in this campaign which also helped pass the measure this time around. The fact that NO DICE, this time, seemed to be against the elderly and handicapped and the revival of Atlantic City also did not help their anti-casino message. A short eighteen months after the voters passed the casino legislation, the first casino opened on the boardwalk in Atlantic City - Resorts International.

Resorts was the first company to support the referendum with money. They were already buying land on the boardwalk paying $2.5 million for the Chalfonte- Haddon Hall hotel. By doing this, instead of building a new hotel, Resorts gained at least a year on its competition and was able to save millions of dollars. The hotel was the only one in Atlantic City to meet the 500 room minimum requirement to open a casino. All the others with smaller hotels and thoughts of adding on were told to tear them down and build from scratch. The state did not want Atlantic City to be a series of “patch-and-paint” jobs. By May 1, 1978, the 1000 rooms of the Chalfonte - Haddon Hall were reduced to 566 to allow for the casino, restaurants, shops and to meet the required 325 square foot minimum for each guest room. Everything was ready to go, dealers trained, chips ordered and delivered, restaurants and shops open and slots installed. Atlantic City changed for good at 10:00 AM on May 26, 1978 when the casino finally opened. Back in the old days, the casino laws in New Jersey allowed for eighteen hours of gaming during the week and twenty hours on weekends. The casino always opened at 10:00 AM each morning, closing at 4:00 AM or 6:00 AM, whichever was valid. I also remember the lines forming around 9:00 AM waiting to get in. If you were a guest of the hotel, you received a pass to get in so you did not have to wait on line. Yes, it was that crazy back then!

Resorts history starts in the Bahamas as the Mary Carter Paint Company which was based in Tampa, Florida. In 1963, wanting to branch out, they bought 3500 acres on Grand Bahama Island and built a residential development called Queens Grove. From here they became a partner in Paradise Island and ran a small casino in Nassau until the Paradise Island Hotel was ready to open. The new casino opened in December of 1967. In 1968, the Mary Carter Paint Company was sold for $9.9 million and three months later Resorts International was born with visions of owning and operating casinos around the world. Soon after the 1974 defeat of the gambling referendum in New Jersey is when Resorts started to become active in Atlantic City, hearing that another bill limiting gambling to Atlantic City was in the works.

Resorts purchased an option on fifty-five acres of boardwalk fronted land from the Housing and Re-Development Authority. Other small parcels were also bought along with the Chalfonte-Haddon Hall hotel and adjacent property making Resorts, at one time, the largest private land owner in Atlantic City. The Showboat Hotel-Casino in Atlantic City sits on land leased to them by Resorts.

Early on, Resorts stock soared as its head start on everyone else paid quick dividends. As more casinos opened however, Resorts, being old and not opting for a major renovation, began to lose its appeal to the newer, flashier places in town. Resorts answer to this was the Taj Mahal project. Started in the mid 1980's, Resorts was never able to complete the project due to financial problems. In 1987, Donald Trump bought a controlling block of Resorts stock. Later that year Trump offered to buy the remaining outstanding stock in Resorts. Early in 1988, Merv Griffin also made a bid for Resorts attempting to wrest it away from Trump. A two month battle ensued with Griffin and Trump finally reaching a deal. Merv Griffin was to receive all of Resorts except for the Taj Mahal project which went to Trump. Since the takeover by Merv Griffin, Resorts has spent nearly $90 million to improve the property. He also sold the Bahamas casino-hotel to Sun International, now known as Atlantis. Resorts has been holding its own against the giants and even posted its first operating profit in years. A major expansion has even been announced adding more rooms and public space to be completed in the next few years. Looks as if casino number one has survived and is here to stay.

Next issue - Caesars Boardwalk Regency and Bally’s Park Place, casinos number two and three.

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