The 'renaissance' next door

By Bob Morgan
Posted 5/15/07

BILOXI, Miss. — The lower tier of Dixie states that include Alabama, Mississippi and Louisiana no doubt share a common perception of hurricane season, namely, that June to October is a crap shoot.

The three states share, among other things, the …

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The 'renaissance' next door


BILOXI, Miss. — The lower tier of Dixie states that include Alabama, Mississippi and Louisiana no doubt share a common perception of hurricane season, namely, that June to October is a crap shoot.

The three states share, among other things, the devastation of Hurricane Katrina on Aug. 29, 2005. Where they differ, however, is in attitude toward the future role of gaming — gambling — in the hurricane recovery process.

At the Southern Gaming Summit, held May 9-10 at Mississippi Coast Coliseum & Convention Center, the talk was of "the new Gulf Coast in the making." Brian Sanderson, president of the Gulf Coast Business Council, a private, non-profit corporation of over 140 business leaders in the region, used the words "rebirth" and "renaissance of our state" in referring to the recovery of the Mississippi Gulf Coast.

"If we do go back as we were before, it will be a tremendous failure," he said, noting gaming is one of the primary engines driving the Mississippi renaissance. In that regard, gaming is also ensuring that lessons that might have been learned decades ago after Hurricane Camille, the signature storm prior to 2005, are learned this time around.

"In Louisiana the gaming community is not embraced as it is in Mississippi," said Michael J. Olivier, secretary of Louisiana Economic Development. His reference was to gaming's role or lack of it as a legitimate part of the Louisiana economy.

In 2005-2006 gaming revenues totaled $753.8 million in Louisiana, $106 million of that from the lottery, Olivier said.

Gaming's future in Louisiana depends on two factors, according to Olivier. For one, Gov. Kathleen Blanco will not seek re-election. That makes things "wide open" politically, Olivier said. For another, Texas, Florida and Alabama are contemplating gaming legislation.

Olivier's mention of Alabama was one of the few times the state was referenced by speakers at the Southern Gaming Summit. The same was true for literature available at the Summit.

That particular reference to Alabama is to a bill that would allow greyhound racetracks in Mobile and Birmingham to have electronic bingo games. Proceeds from the bingo tax at the two racetracks would be used to defray costs of the Alabama Medicaid Program.

The bill, HB 527, has, at this writing, had a second reading in the Alabama Legislature's Regular Session 2007. The bill proposes an amendment to the state's Constitution of 1901 and levies an amount equal to 20 percent of gross revenues on electronic bingo.

On top of that, each racetrack would pay an annual amount not to exceed $500,000 to defray the cost of regulating bingo games.

One day before the 25th legislative day of the Regular Session, however, a legislative spokesman said prospects for HB 527 did not look promising. The bill's sponsor, Rep. Marcel Black, D-Tuscumbia, doesn't have the votes to move the bill along, the spokesman said.

Thus, two states which, for better or worse, have been linked together by history, geography and culture, find themselves polar opposites on the subject of gaming.

Stephen B. Richer, a Princeton University graduate and former New Jersey mayor, is now executive director of the Mississippi Gulf Coast Convention & Visitors Bureau. He characterizes the Mississippi Gulf Coast renaissance - fueled by gaming - as "statewide, top to bottom, enthusiasm and cooperation."

In Alabama, Gov. Bob Riley and Attorney General Troy King have made it clear that gaming in the state will not be expanded under their watch.

The upshot of the two states' positions is set forth in an observation by Jeremy White in the March 2007 issue of Southern Gaming and Destinations, a magazine available at the Summit. In an article, "the birth of racinos" (a "racino" is one of the 20 horse or greyhound tracks operational in the U.S. today that have casino gaming), White says this:

"The degree of difficulty for enacting legislation that allows for slots at the track varies by state. Often, it depends upon the nature of the administration. A governor opposed to expanded gaming can make the path quite arduous. A benevolent governor and legislative body, by contrast, take the teeth out of the process."


Jerry St. Pe' is chairman of the Mississippi Gaming Commission and former president of Ingalls Shipbuilding. He served as moderator of the Southern Gaming Summit's conference on "Recovery and Rebirth: Economic Overview: The New Gulf Coast." St. Pe' is the one who made reference to "the new Gulf Coast in the making."

St. Pe' asked a question about Mississippi's hurricane recovery efforts and answered with a question as well.

Question: "How are we doing?"

Answer: "What is there to measure against?"

The point St. Pe' makes is that Katrina was the worst natural disaster in U.S. history. As Olivier put it in the same conference, "We are writing the book. There are no books (for us) to follow."

Richer described the goal for the Mississippi Gulf Coast as being a "tier one" premier destination. To do that, 30,000 rooms are needed, he said. At present, 17,500 are available. Also, 600,000 square feet of meeting and business space are needed, along with more direct and connecting flights from Gulfport. All of this is within reach, Richer said. Lastly, Richer said there needs to be "things to do," namely, golfing, dining, shopping and such.

It is a point that was echoed by Jon Lucas, president and general manager of IP Casino Resort Spa. Lucas has also worked in gaming in Tunica, Miss., and Atlantic City, N.J. He and his Biloxi "back bay" casino are an example of a point he made during the conference, how the gaming industry has never been more involved in the community than now.

Lucas successfully rebuilt and repositioned IP in less than four months after Katrina. Within three weeks after the hurricane, 800 employees were back at work at IP, which today employs 2,500.

"People need an outlet - something to do," Lucas said of gaming. In speaking of the return of gambling patrons from places like Tunica and Vicksburg after the re-opening of the state's coastal casinos, Lucas called it the "path of least resistance." In other words, people who want to gamble are going to do so at the most convenient site. But for Lucas, it isn't necessarily all about gaming. As proof, he points to the nation's gaming capital, Las Vegas.

According to Lucas, Las Vegas generates more dollars today from non-gaming amenities than it does from gaming. It's all about what Richer called "things to do."

D. Craig Ray, director of the Mississippi Development Authority's Tourism Division, said the state will receive $333 million this year in gaming revenues, but golf is a $150 million annual industry in the state as well.

"Tourism is what's going to drive this market in the end," said Lucas.


"For years, we've kept a watchful eye on what's happening on the Mississippi coast," said Herb Malone, CEO of the Alabama Gulf Coast Convention & Visitors Bureau.

It isn't as if Malone feels threatened by the so-called Mississippi coast renaissance. For one thing, he points to indications that interest in the casino-gaming atmosphere of the Mississippi coast has been steadily declining.

"We have always positioned ourselves as that clean, family, wholesome destination," he said of the Alabama Gulf Coast.

"Families come here looking for a lifestyle that's different from the casinos and that type of situation," echoes Donna Watts, president and CEO of the South Baldwin Chamber of Commerce.

According to Malone, everything is in competition with tourism along the Alabama Gulf Coast to a degree, including the cruise ships out of Mobile. But that isn't a negative.

"The more amenities we have regionally the better it is for all of us," he said. He notes, as the crow flies, it is no big effort for tourists to leave the Mississippi coast and come to the Alabama coast for a day of recreation and vice versa.

"Baby-boomers typically don't go to just one destination," said Watts. "They're adventurous and like to go to different locations."

Malone points out that the last serious discussion about legislation to legalize casinos in Alabama occurred during the administration of Jim Folsom Jr. The elected leadership of the state and business leaders spoke out against it, Malone said, moreso from a business perspective than a moral one.

But the future, by definition, is about what will and could happen. The population growth that is anticipated in Baldwin County over the next 10 years will have a huge bearing on what will be accepted or not and how the landscape could change, Watts said.

"The political leanings of those who will come … ," she points out about the future. "It will be based on who comes here and what their attitude is toward gambling."

Whatever, it isn't all bells and whistles and jackpots on the Mississippi coast. An issue is looming next door to Alabama that is being called "Ground Zero" by some. It has to do with the prospect of "Indian Country" arriving in Jackson County, just up the road from all those casinos in Harrison and Hancock counties.

It is an issue that could have a direct bearing on Alabama's future where gaming is concerned.