By Jerry Hirsch
LA Times Staff Writer
September 5, 2005
Just a week ago the Grand Casino Biloxi gambling barge floated gently on the Gulf of Mexico shoreline. Now it stretches awkwardly across the lanes of U.S. Highway 90 in Mississippi, ripped from its moorings by the storm surge that followed Hurricane Katrina.
The 106,300-square-foot structure — about the size of a Target department store — is a total loss, along with its 2,800 slot machines and 89 roulette, craps and blackjack tables.
"They will have to break it up and cart it away in dump trucks to get the highway open," said Larry Gregory, executive director of the Mississippi Gaming Commission.
When that happens, workers will haul off a large piece of an industry that has helped revive this corner of one of the poorest states in the nation. As the gaming companies search for their employees, and make sure they have paychecks and medical insurance that will work in neighboring states, no one is predicting how long it will take for the industry to come back.
Until Katrina swept through Hancock, Harrison and Jackson counties, visitors to the state's Gulf Coast left more than $1.2 billion annually in the coffers of the 13 casinos that in little more than a decade have transformed a once-sleepy backwater into a thriving tourist destination.
"The Mississippi Gulf Coast had almost no economy before the casinos came," Gregory said.
In the 13 years since the first casino opened, the state's coast has grabbed a 4% share of the nation's gaming market, not including Indian gaming establishments, helping to make Mississippi the nation's third-biggest casino state, after Nevada and New Jersey.
Other measures also demonstrate the economic improvements the industry has wrought.
Thanks to casino jobs and tourism employment, the region's jobless rate last year averaged 4.2%, at least a full percentage point below the averages for Mississippi and the nation.
The median per capita income of $24,811 by the Gulf Coast's 370,000 residents is 4.4% above the state figure, according to the Harrison County Economic Development Commission, though it's still about $6,000 below the national median.
The coast's casinos pumped $49 million in tax revenue into the region's local governments in fiscal 2005 and $99 million into state coffers, the gaming commission said. The figures don't include the millions of additional dollars collected by the state and local governments in the form of lodging and sales taxes generated by visitors to the area.
"This money was really important to Mississippi, which for decades has suffered from an inability to collect tax revenues," said John Gnuschke, director of business and economic research at the University of Memphis.
And just before Katrina, the coast's gaming industry was poised for even more growth.
An 11-story, 306-room Hard Rock Hotel & Casino was scheduled to open last week, the first new casino on the state's coast since 1999. Gregory said the $235-million project may be a complete loss.
Likewise, several continuing improvements at the Isle of Capri property in Biloxi, including 400 additional hotel rooms, a new parking garage and new casino barge, suffered "extensive damage" and could be a total loss.
Harrah's Entertainment Inc., the Grand Casino's owner, also lost its Grand Casino Gulfport nearby. Still, Harrah's, the world's largest gaming company, said it wouldn't abandon the region.
"We will build them bigger and better," Chief Executive Gary Loveman said.
But just a week after Katrina carved her destructive path through the Gulf Coast, no one knows how well or how quickly the casino industry will bounce back and whether the 11 million tourists who once streamed to the area from nearby states such as Alabama, Florida, Tennessee and Texas will still want to visit, said Gnuschke, the University of Memphis economist.
"It is a chicken-or-the-egg thing," Gnuschke said. "You need the casinos to get the people and you need the people for the casinos. Then you need homes for the workers and all the ancillary things like hotel rooms, restaurants and everything else."
No one yet has made a formal assessment, but Gnuschke said it would take years to rebuild the industry.
Almost overnight, "one of the top tourist destinations in the state" vanished, said Webster Franklin, chief executive of the convention and visitors bureau in Tunica, a rival Mississippi gambling region near Memphis, Tenn., that escaped the storm.
Exactly where the industry will rebuild is a matter of a debate.
The 1990 law that legalized Mississippi gambling required that casinos operate only on ocean waters or the Mississippi River. The law was a compromise between the opponents of gambling in the conservative, Bible Belt state and lawmakers, who wanted to capture tax dollars that were floating away on gambling cruises that left the coastline for the international waters of the Gulf of Mexico.
"They thought this would keep gambling from becoming part of the fabric of the society," said Gregory, the state gambling regulator.
Harrah's wants the right to rebuild on land.
"There's too much potential for danger having gaming on water," said Alberto Lopez, Harrah's spokesman.
The company's casino in New Orleans — a much smaller gambling market also shuttered by the storm — is built on land and survived the full force of Katrina relatively intact, he said, suffering $200,000 in damage.
"This will be the No. 1 issue facing the legislature," Gregory said.
LA Times Staff Writer
September 5, 2005
Just a week ago the Grand Casino Biloxi gambling barge floated gently on the Gulf of Mexico shoreline. Now it stretches awkwardly across the lanes of U.S. Highway 90 in Mississippi, ripped from its moorings by the storm surge that followed Hurricane Katrina.
The 106,300-square-foot structure — about the size of a Target department store — is a total loss, along with its 2,800 slot machines and 89 roulette, craps and blackjack tables.
"They will have to break it up and cart it away in dump trucks to get the highway open," said Larry Gregory, executive director of the Mississippi Gaming Commission.
When that happens, workers will haul off a large piece of an industry that has helped revive this corner of one of the poorest states in the nation. As the gaming companies search for their employees, and make sure they have paychecks and medical insurance that will work in neighboring states, no one is predicting how long it will take for the industry to come back.
Until Katrina swept through Hancock, Harrison and Jackson counties, visitors to the state's Gulf Coast left more than $1.2 billion annually in the coffers of the 13 casinos that in little more than a decade have transformed a once-sleepy backwater into a thriving tourist destination.
"The Mississippi Gulf Coast had almost no economy before the casinos came," Gregory said.
In the 13 years since the first casino opened, the state's coast has grabbed a 4% share of the nation's gaming market, not including Indian gaming establishments, helping to make Mississippi the nation's third-biggest casino state, after Nevada and New Jersey.
Other measures also demonstrate the economic improvements the industry has wrought.
Thanks to casino jobs and tourism employment, the region's jobless rate last year averaged 4.2%, at least a full percentage point below the averages for Mississippi and the nation.
The median per capita income of $24,811 by the Gulf Coast's 370,000 residents is 4.4% above the state figure, according to the Harrison County Economic Development Commission, though it's still about $6,000 below the national median.
The coast's casinos pumped $49 million in tax revenue into the region's local governments in fiscal 2005 and $99 million into state coffers, the gaming commission said. The figures don't include the millions of additional dollars collected by the state and local governments in the form of lodging and sales taxes generated by visitors to the area.
"This money was really important to Mississippi, which for decades has suffered from an inability to collect tax revenues," said John Gnuschke, director of business and economic research at the University of Memphis.
And just before Katrina, the coast's gaming industry was poised for even more growth.
An 11-story, 306-room Hard Rock Hotel & Casino was scheduled to open last week, the first new casino on the state's coast since 1999. Gregory said the $235-million project may be a complete loss.
Likewise, several continuing improvements at the Isle of Capri property in Biloxi, including 400 additional hotel rooms, a new parking garage and new casino barge, suffered "extensive damage" and could be a total loss.
Harrah's Entertainment Inc., the Grand Casino's owner, also lost its Grand Casino Gulfport nearby. Still, Harrah's, the world's largest gaming company, said it wouldn't abandon the region.
"We will build them bigger and better," Chief Executive Gary Loveman said.
But just a week after Katrina carved her destructive path through the Gulf Coast, no one knows how well or how quickly the casino industry will bounce back and whether the 11 million tourists who once streamed to the area from nearby states such as Alabama, Florida, Tennessee and Texas will still want to visit, said Gnuschke, the University of Memphis economist.
"It is a chicken-or-the-egg thing," Gnuschke said. "You need the casinos to get the people and you need the people for the casinos. Then you need homes for the workers and all the ancillary things like hotel rooms, restaurants and everything else."
No one yet has made a formal assessment, but Gnuschke said it would take years to rebuild the industry.
Almost overnight, "one of the top tourist destinations in the state" vanished, said Webster Franklin, chief executive of the convention and visitors bureau in Tunica, a rival Mississippi gambling region near Memphis, Tenn., that escaped the storm.
Exactly where the industry will rebuild is a matter of a debate.
The 1990 law that legalized Mississippi gambling required that casinos operate only on ocean waters or the Mississippi River. The law was a compromise between the opponents of gambling in the conservative, Bible Belt state and lawmakers, who wanted to capture tax dollars that were floating away on gambling cruises that left the coastline for the international waters of the Gulf of Mexico.
"They thought this would keep gambling from becoming part of the fabric of the society," said Gregory, the state gambling regulator.
Harrah's wants the right to rebuild on land.
"There's too much potential for danger having gaming on water," said Alberto Lopez, Harrah's spokesman.
The company's casino in New Orleans — a much smaller gambling market also shuttered by the storm — is built on land and survived the full force of Katrina relatively intact, he said, suffering $200,000 in damage.
"This will be the No. 1 issue facing the legislature," Gregory said.
