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Best of Gary Trask
Gaming heavyweights plead their case for casinos in Massachusetts21 December 2007
BOSTON – Sheldon Adelson and Gary Loveman have already made their marks in the casino and gaming industry. They have their millions – or in Adelson's case, billions of dollars – and their legacies of success are firmly entrenched.
But after listening to each man talk about the possibility of building and operating a casino in Massachusetts, it becomes clear that bringing their business back to their home state would be considered much more than just another feather in their respective caps.
Adelson, who grew up in the Dorchester area of Boston and is now the chairman and chief executive officer of the Las Vegas Sands, and Loveman, who holds the same title with Harrah's Entertainment, returned to their roots Tuesday to support a bill drafted by Gov. Deval Patrick that would bring three resort-style casinos to Massachusetts. The men were part of a host of speakers at a legislative hearing at the State House that drew a standing-room-only crowd inside the 600-seat Gardner Auditorium.
"It's a natural," said Loveman of bringing casinos to the state. "You have a large affluent group of adults that have already shown an interest in gaming. On top of that there's very little supply, other than what's available in Connecticut (the Foxwoods and Mohegan Sun casinos). So this is an attractive market to say the least."
Loveman, who joined Harrah's as its COO in 1998 and became its CEO in 2003, didn't speak until the tail end of the eight-hour hearing. But he was present for virtually the entire event and told Casino City that most of what he heard throughout the day was what he expected.
"What always strikes me is that we are an industry that's prepared to invest $3 billion, pay $800 million in license fees and generate $300 in incremental revenues per year and we ask for nothing," said Loveman, who was instrumental in Harrah's June 2005 acquisition of Caesars Entertainment for $9.4 billion, the largest single transaction in the industry's history. "We don't ask for infrastructure. We don't ask for environmental maintenance. We don't ask for tax breaks. We ask for nothing, but yet the debate always becomes if that is enough."
During his testimony, Loveman, a 25-year Massachusetts resident and a former associate professor at Harvard University, called Gov. Patrick's proposal "some of the most enlightened thinking about our industry and what it can do for a state" that he has seen in years.
"Legalized and regulated casino gambling is a proven job creator, a catalyst for economic rejuvenation and a dependable source of public revenue that does not depend on asking taxpayers for handouts," he went on to say. "Furthermore, the destination resort model for casino development, which Gov. Patrick is proposing, is the form of casino gaming that, by far, delivers the most in terms of comprehensive economic development benefits."
When it comes to resort casinos, the ultimate authority may very well be Adelson, whose company just recently opened the Venetian Macao, which is the second-largest building in the world. Adelson changed the way business was done in Las Vegas when he bought the old Sands casino for $128 million in 1989 and promptly demolished it to build the $1.5 billion all-suites Venetian casino resort and the 1.2-million-square foot Sands Convention Center. He was a pioneer in thinking that it would more beneficial to take the importance off gambling revenue and concentrate it on luring conventioneers to the city midweek.
The 73-year-old moved slowly around the auditorium throughout the proceedings on Tuesday, needing a cane and help from his wife, Miriam, to get from place to place. But Adelson appeared quite comfortable when a throng of TV crews and reporters cornered him just outside the auditorium doors a few hours before he spoke to the panel.
Adelson, who was ranked No. 3 on Forbes magazine's list of the 400 Richest Americans, was quite glib as he answered an array of questions. The one point he drove home repeatedly was that the casino portion of a resort is a small part of its make-up and revenue.
"My Venetian-Las Vegas is 1.6 million square feet. Does anyone want to guess what percent of that makes up the casino?" he asked the media.
After a few incorrect guesses, Adelson revealed the answer.
"One percent," he said forcefully. "The point is that there's more to these resorts than just the gambling. We bring a lot of other great things to the table."
Adelson, who owns an estate in nearby Newton, also spoke passionately about what a casino under his watch would do for the local workforce.
"I employ 28,000 people and I have everything from maids that make $25,000 a year to the 180 people on my payroll who are millionaires," he said while reiterating that he would use union workers if he were to build a Massachusetts casino. "I allow my employees to pick whatever health care plan they want. And if their spouse already has coverage, I give them cash. We provide a 150% match for our 401K. We have free day care and a concierge for our employees that will send FedEx packages or go to the cleaners for our people if they need something like that done for them while they're working. As you can see I'm pro-employee. I take care of the people that work for me."
One item of Gov. Patrick's proposal that Adelson disagrees with is the amount of casinos to be built.
"Three is too many," he said. "With each one spending $2 billion, you have to have convention space, shopping areas, restaurants, show rooms. You have to have entertainment. The more competition there is the less money there is to be made. And if I can't make 15 to 20 percent, I won't build. It's that simple.
"People think that building a casino is a license to print money," he continued. "But that's not true. There are plenty of casinos out there that are losing money. I'm not going to own one of those."
Then the question was posed to Adelson regarding the presumed decline in quality of life in a community that builds a casino.
"Who are the people that are saying that?" he asked the reporter.
Before he could hear the answer, Adelson asked another question.
"Is it Bill Gates? Is it Warren Buffet?" he said.
When told no, he answered, "Well, if the people that are saying that are so smart, why aren't they rich?"
"Look, whether you want to admit it or not, gambling has been going on in this state forever," he said. "I used to go to the horse track with my father when I was a kid. People are driving to Connecticut every day to gamble. Why not keep them in their home state?"
Adelson's impromptu press conference had lasted more than 20 minutes when he started to make his way back into the auditorium. He asked when he would be speaking in front of the panel and someone told him not for at least another hour.
"You're probably going to miss your flight," a woman TV reporter said to him, apparently forgetting that she was speaking to man with a net worth of $20.5 billion.
"Believe me, Miss," he said with a smile. "My plane doesn't leave unless I'm on it."
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