The Lengthening Odds of a Casino in Amsterdam , Montgomery County
I think the odds for a casino just went longer per this writeup in the Mohawk Valley Compass:
Both Ossenfort and representatives of the development companies said that the changes were necessary due to the estimated revenue and slim profit margins of the facility.
The reasons are twofold:
1) The application fee is 50% of the target ($25 million versus $50 million). If you look at the selection criteria from the NY State Gaming and Economic Development Act, you see that the second criteria is ‘Capital Investment’ and already there is a hedge here on the ‘investment’.
2) The conflicting message that profit margins will be ‘slim’ while pitching a percentage of revenue to make up for the request for the 50% application fee.
I’m a bit stunned at the messaging here on the financials and economics — it’s basically saying this will be marginally successful and asking the commission to forego the application fee today to get a bigger return in the future even though the future proforma operating profits are ‘slim’. The reason cited is that this is because of the economics of Montgomery County. That may be true but to the commission it would read as a weakness in the this locale compared to others in terms of total revenues generated to the state. The commission likely seeks to optimize state revenues and outcomes, not local revenues and outcomes.
Of course, this proposal will be viewed relative to other locales but the pitch here seems problematic on a few levels.
Seems like long odds.