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Old 03-20-2010, 08:38 PM   #101
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Re: AC need not worry about Philly/PA casinos

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Originally Posted by Jim215 View Post
In casino lingo (your link), "revenue" appears to be net income (profit) or the amount of money remaining AFTER expenses have been deducted (the "win" for the casino).
A casino's "win", or its " gambling revenue", is its net win on the floor. Not the net after all expenses (such as payroll or utilities) have been deducted.
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Originally Posted by Dima2000123 View Post
Just think about it for a moment. Let's take blackjack as an example. Assume that in a 100 hands, casino wins 51 of them, and the player wins 49. Each hand is worth $10 (let's ignore BJ payouts for simplicity). When the casino wins their 51 hands, they get $510, and will pay $41 in taxes. When they lose their 49 hands, they pay out $490. Therefore, they net -$21 before they even pay the dealers or other expenses.

Does that make sense to you?
No.

Because you're doing it wrong. It your example, the casino's "win" is $20.
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Old 03-20-2010, 09:22 PM   #102
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Re: AC need not worry about Philly/PA casinos

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Originally Posted by Ruler of the East View Post
Do you want to argue about it or do you want the truth. I know for sure what the answer is.

Stan
Stan:
Please, please enlighten us.
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Old 03-20-2010, 10:23 PM   #103
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Re: AC need not worry about Philly/PA casinos

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Originally Posted by Jim215 View Post
Stan:
Please, please enlighten us.
I would love to. I will say i enjoyed the topic but i think its time to end it and go on to something more interesting.

The answer is win. The state taxes us on our win each day. tax comes before expenses. It doesn't matter or not if the casino is good at controlling expenses. Thery are getting theirs first.

If the casino wins a million on Saturday. They will pay 8% on 1 million. The casino will then put the rest in the bank minus their expenses such as payroll and all other overhead.


Stan
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Old 03-20-2010, 11:01 PM   #104
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Re: AC need not worry about Philly/PA casinos

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Originally Posted by Ruler of the East View Post
I would love to. I will say i enjoyed the topic but i think its time to end it and go on to something more interesting.

The answer is win. The state taxes us on our win each day. tax comes before expenses. It doesn't matter or not if the casino is good at controlling expenses. Thery are getting theirs first.

If the casino wins a million on Saturday. They will pay 8% on 1 million. The casino will then put the rest in the bank minus their expenses such as payroll and all other overhead.


Stan
Thanks, Stan.
Just to clarify. The casino is NOT taxed on money going INTO the slots but rather the "win" after payouts (not expenses) are made. Correct?
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Old 03-20-2010, 11:43 PM   #105
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Re: AC need not worry about Philly/PA casinos

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Originally Posted by Jim215 View Post
OK, then let's try this.
You have a $100 bill to put in a slot machine.
Your choice is PA or NJ.
The casino owners in PA have to pay 55% of their profits in taxes.
The casino owners in NJ have to pay 9% of their profits in taxes.
Where do you put your $100?
They both pay out in the 80-90% range so why does anyone care what the casino is paying in taxes, it has no effect on the payouts that should be posted, PA casinos are not paying out 50% like the OP wants you to believe, they are required by law to pay out at least 85%, now all you AC fans out there, AC casinos only pay out 83%. Now every dollar put into a PA slot machine the machine will return 85 cents, in AC the same dollar only returns 83 cents, So in turn the AC casinos are making a larger profit per dollar before taxes then the PA casinos, that is what matters not what they have to pay after the count.

Then the ones that think smoking hurts the casino? Someone should tell that to the Vegas casinos, they made it so they were exempt from the NV clean air act, but what do they know anyway.

Now the geniuses that think this affects poker, a $5 rake is a $5 rake, 10% up to $5 is the same in AC and PA. I would pay the extra dollar if it saved me a hour drive plus tolls and gas anyway.
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Old 03-20-2010, 11:44 PM   #106
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Re: AC need not worry about Philly/PA casinos

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Thanks, Stan.
Just to clarify. The casino is NOT taxed on money going INTO the slots but rather the "win" after payouts (not expenses) are made. Correct?
That is correct. The money going into the slot machine is called coin in.

Stan
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Old 03-21-2010, 06:13 AM   #107
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Re: AC need not worry about Philly/PA casinos

8% of EBITDA....if I am not mistaken.....
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Old 03-21-2010, 09:54 AM   #108
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Re: AC need not worry about Philly/PA casinos

They're going to allow smoking at the Poker tables? ****ty, that'll be enough to keep me going to AC.
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Old 03-21-2010, 01:53 PM   #109
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Re: AC need not worry about Philly/PA casinos

Why would they ever have smoking at poker tables in PA? Why would AC casinos ever be taxed on the money going INTO slot machines? How are you people even having this discussion?
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Old 03-21-2010, 01:54 PM   #110
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Re: AC need not worry about Philly/PA casinos

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They're going to allow smoking at the Poker tables? ****ty, that'll be enough to keep me going to AC.
That's the first I heard that.
If true, I won't even do a test poker visit anywhere in PA (my home base).
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Old 03-21-2010, 02:04 PM   #111
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Re: AC need not worry about Philly/PA casinos

I'm not saying "They'll have smoking at poker tables", I'm asking the question. Earlier in the thread it said they were going to allow smoking. Since AC casinos also offer smoking on the general casino floor, I was wondering if people meant it would also apply to the poker room.
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Old 03-21-2010, 04:17 PM   #112
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Re: AC need not worry about Philly/PA casinos

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Originally Posted by mxp2004 View Post
I heard this, too. I was playing poker at Showboat in AC, and the dealer was talking about the PA casinos and some of Harrahs' plans. He mentioned that PA casinos will require players to pay for alcohol at the tables.

At first, I was sort of incredulous, and then I remembered that this is what life in PA is like. The state still does not allow private liquor stores, but instead, sells alcohol only through state-owned stores. James Carville once described the state as Pittsburgh and Philadelphia with Kentucky in between. It's a miracle that the gambling bill passed at all.
FYP.

And no free drinks at PA casino's and that's why we call it pennsyltucky.

I am sure most of the casino's in PA will be building hotels if they don't have them already. I know Mount Airy already has a hotel and they are in the Pocono's already a big tourist area.

And I highly doubt they will allow smoking in the poker room. Also I know that the wilkes Barre/Scranton Area has a lot of good players that are waiting for the rooms around here to open.
The good thing though is that there is a pretty big poker scene so there are a lot of fish as well. But I think because of the lack of tourists that will come to the area the games may actually be tougher that AC.

There are already tons of poker rooms around here and the ones I have played at have some really good players.


Also about the Tax and tightness of the slots. I have heard that the casino's/slot parlors have already gotten numerous fines for not paying out what they are supposed to % wise but the fine is lower than the costs of paying out more that they don't care...This is just hear-say so take it with a grain of salt.

Last edited by nuisance; 03-21-2010 at 04:22 PM.
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Old 03-21-2010, 05:04 PM   #113
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Re: AC need not worry about Philly/PA casinos

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Originally Posted by nuisance View Post
FYP.


And I highly doubt they will allow smoking in the poker room. Also I know that the wilkes Barre/Scranton Area has a lot of good players that are waiting for the rooms around here to open.
The good thing though is that there is a pretty big poker scene so there are a lot of fish as well. But I think because of the lack of tourists that will come to the area the games may actually be tougher that AC.

There are already tons of poker rooms around here and the ones I have played at have some really good players.

Well, considering that the tourists who play in AC typically come from NYC and Philadelphia I would assume the games will be plenty good. There are just so many people who live in the area that the games should thrive.
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Old 03-22-2010, 08:17 PM   #114
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Re: AC need not worry about Philly/PA casinos

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Originally Posted by Dima2000123 View Post
On this particular point, and this particular point only, I'm going to side with Jim215. There is no way that NJ casinos pay 8% tax on revenues if you definite revenue as any time casino wins a bet.
This is correct. But "revenue" has a very specific definition in the gaming industry, and "any time casino wins a bet" is not it.

Quote:
Originally Posted by Ruler of the East View Post
That is correct. The money going into the slot machine is called coin in.

Stan
Stan, this is simply not accurate. If a player puts a $5 bill into a slot machine with a $1 bet per spin, and has the following results:
  • insert $5 bill ($5 credits left)
  • bet $1 lose $1 ($4 credits left)
  • bet $1 lose $1 ($3 credits left)
  • bet $1 win $5 ($7 credits left)
  • bet $1 lose $1 ($6 credits left)
  • bet $1 lose $1 ($5 credits left)
  • bet $1 lose $1 ($4 credits left)
  • bet $1 lose $1 ($3 credits left)
  • bet $1 lose $1 ($2 credits left)
  • cash out $2 (zero credits left)

then the relevant statistics would be:
coin-in: $8
gaming revenue: $3

Jim215 is correct that revenue taxes are computed on the $3 of gaming revenue, NOT the $8 of coin-in or the $5 inserted into the machine. This is because the $3 is defined as REVENUE by the regulating state commissions as well as the accounting boards and SEC, and the IRS. $3 is not PROFIT, which comes after payroll, revenue taxes, interest on debt, the electric bill, and every other expense that every business has. The casinos then pay income taxes, just like every other company, on their net profit.

Perhaps this is nit-picking, however when your post contains the word "profit" capitalized, bolded, and underlined, you should make sure that you are using the word correctly. Because it has a unique way of making money, the gaming industry has defined these terms very specifically and exactly, so when you say "profit" when you mean "gaming win", you are incorrect.

Regardless, this argument is irrelevant, since I have already pointed out (in post #79) the government-published win and hold statistics for both NJ and PA which clearly demonstrate that PA is very much in line with NJ casinos in terms of hold percentage and payback percentage to the players. In both states the hold % is about 8 to 10%.


(OFF-TOPIC: Stan would be correct if he was talking about table games, not slots. Slots and table games are accounted for differently. Slot machines, which are really computers, have the ability to accurately count every single bet. Coin-in is the sum total of all individual bets made on the machines. In table games, every single individual bet is not tracked, so it uses total "handle" (also known as "drop"), which is the sum total of all the cash that goes in the box (the slot in the table where the dealer puts your money). So with tables, if you walk up to the table with $500 cash, buy chips, and leave with $300 in chips, the drop was $500 and gaming win (revenue) was $200. Doesn't matter if you made 2 $100 bets and lost them both, or 40 $100 bets and went up and down. This is different than the way slots calculate coin-in.

Extra bonus fact: typical "hold" on blackjack is 15-17% -- even though the mathematical edge on a single hand is about 1%, the recycling of bets means that for every $100 cash that goes in the box, the casino typically keeps $15-17.)
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Old 03-22-2010, 08:27 PM   #115
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Re: AC need not worry about Philly/PA casinos

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Originally Posted by joboggi View Post
8% of EBITDA....if I am not mistaken.....
No, in NJ it is 8% of gaming revenue. Way more than EBITDA. And since the casinos all opt to pay the 1.25% CRDA fee (Casino Reinvestment Development Authority), the percentage is effectively 9.25%


http://www.njcrda.com/about-us/pages...t-funding.aspx
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In addition to other gaming-related taxes, State law gives each casino a choice: pay 2.5% of its gaming revenue to the State, or reinvest 1.25% of its gaming revenues through the CRDA in community and economic development projects in Atlantic City and around the State. Without exception, the casinos have chosen reinvestment.
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Old 03-22-2010, 08:37 PM   #116
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Re: AC need not worry about Philly/PA casinos

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Originally Posted by Jim215 View Post
And since you have such unflagging faith in the honesty of casino operators, I would call your attention to the tens of millions of dollars stolen from players at Absolute Poker (true, not a brick and mortar casino) where the cheaters could see the cards of the other players.
As I recall that wasn't back in the Sixties, was it?
This discussion is about US-based, state-regulated, land-based casinos, the taxes they pay, and your assertion that they must be skimming. Absolute Poker has zero in common with any of these and is completely irrelevant. I'm not totally familiar with the situation but I thought the stolen money wasn't going to Absolute Poker (or stolen from the company), it was employees cheating other players for their personal accounts, is that right? My guess -- if you looked at Absolute's books, I'd bet that they have paid the full tax amount owed to the Kahnawake Gaming Commission.
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Old 03-22-2010, 10:40 PM   #117
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Re: AC need not worry about Philly/PA casinos

I personally know that I will play in Philly at Parx and Harrah's chester more often then heading to AC, the Borgata will still be my favorite poker room unless Parx really comes up huge. By huge I mean good crowds and good games. AC is just to far for day trips and such. Bring on the good games!!!!
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Old 03-22-2010, 11:02 PM   #118
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Re: AC need not worry about Philly/PA casinos

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Originally Posted by ExactaBox View Post
This is correct. But "revenue" has a very specific definition in the gaming industry, and "any time casino wins a bet" is not it.



Stan, this is simply not accurate. If a player puts a $5 bill into a slot machine with a $1 bet per spin, and has the following results:
  • insert $5 bill ($5 credits left)
  • bet $1 lose $1 ($4 credits left)
  • bet $1 lose $1 ($3 credits left)
  • bet $1 win $5 ($7 credits left)
  • bet $1 lose $1 ($6 credits left)
  • bet $1 lose $1 ($5 credits left)
  • bet $1 lose $1 ($4 credits left)
  • bet $1 lose $1 ($3 credits left)
  • bet $1 lose $1 ($2 credits left)
  • cash out $2 (zero credits left)

then the relevant statistics would be:
coin-in: $8
gaming revenue: $3

Jim215 is correct that revenue taxes are computed on the $3 of gaming revenue, NOT the $8 of coin-in or the $5 inserted into the machine. This is because the $3 is defined as REVENUE by the regulating state commissions as well as the accounting boards and SEC, and the IRS. $3 is not PROFIT, which comes after payroll, revenue taxes, interest on debt, the electric bill, and every other expense that every business has. The casinos then pay income taxes, just like every other company, on their net profit.

Perhaps this is nit-picking, however when your post contains the word "profit" capitalized, bolded, and underlined, you should make sure that you are using the word correctly. Because it has a unique way of making money, the gaming industry has defined these terms very specifically and exactly, so when you say "profit" when you mean "gaming win", you are incorrect.

Regardless, this argument is irrelevant, since I have already pointed out (in post #79) the government-published win and hold statistics for both NJ and PA which clearly demonstrate that PA is very much in line with NJ casinos in terms of hold percentage and payback percentage to the players. In both states the hold % is about 8 to 10%.


(OFF-TOPIC: Stan would be correct if he was talking about table games, not slots. Slots and table games are accounted for differently. Slot machines, which are really computers, have the ability to accurately count every single bet. Coin-in is the sum total of all individual bets made on the machines. In table games, every single individual bet is not tracked, so it uses total "handle" (also known as "drop"), which is the sum total of all the cash that goes in the box (the slot in the table where the dealer puts your money). So with tables, if you walk up to the table with $500 cash, buy chips, and leave with $300 in chips, the drop was $500 and gaming win (revenue) was $200. Doesn't matter if you made 2 $100 bets and lost them both, or 40 $100 bets and went up and down. This is different than the way slots calculate coin-in.

Extra bonus fact: typical "hold" on blackjack is 15-17% -- even though the mathematical edge on a single hand is about 1%, the recycling of bets means that for every $100 cash that goes in the box, the casino typically keeps $15-17.)
First of all i never said that the cainos pay taxes on coin in. We pay taxes on win. Trust me, i am not wrong. I only look over a budget in the casino industry and i see the taxes paid on that budget each month.

Stan
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Old 03-22-2010, 11:14 PM   #119
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Re: AC need not worry about Philly/PA casinos

Jim215 is correct that revenue taxes are computed on the $3 of gaming revenue, NOT the $8 of coin-in or the $5 inserted into the machine. This is because the $3 is defined as REVENUE by the regulating state commissions as well as the accounting boards and SEC, and the IRS. $3 is not PROFIT, which comes after payroll, revenue taxes, interest on debt, the electric bill, and every other expense that every business has. The casinos then pay income taxes, just like every other company, on their net profit.

This is not a federal or state taxe that we are talking about. We are talking about the gaming tax. In NJ its 8% on the casino win. If you had a black jack table that you owned and ran each day you would have to play the 8% tax on what you won.

Example

If you won say $50,000 on your Black Jack table on saturday night. You would have to give the state $4,000 in taxes. In regards to your budget for saturday night it would look something like this.

Win $50,000
Taxes ($4,000)
Payroll ($850)
Comps ($1,000)
Other related costs such as lights, and other overhead ($2,000)
Bottom Line $42,150

Stan
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Old 03-23-2010, 01:00 PM   #120
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Re: AC need not worry about Philly/PA casinos

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Casino revenue taxes in both NJ and PA (and every other state) are calculated from REVENUE not profit.
Stan, we agree, gaming tax is paid based on gaming revenue, I stated that in post #89 (above). Other people in this thread misinterpreted what "revenue" was. I was only disagreeing on your definition of coin-in. It is NOT "The money going into the slot machine is called coin in."

The primary point was that one person here insisted that PA casinos cannot compete because their gaming tax on slot win is 50+% vs 8% in NJ. He stated that PA casinos MUST be skimming profits, or that their slot machines do not pay out as much as NJ slots. I and others offered numerous links to verify that both of these assertions were factually incorrect.
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Old 03-23-2010, 01:44 PM   #121
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Re: AC need not worry about Philly/PA casinos

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Originally Posted by ExactaBox View Post
Stan, we agree, gaming tax is paid based on gaming revenue, I stated that in post #89 (above). Other people in this thread misinterpreted what "revenue" was. I was only disagreeing on your definition of coin-in. It is NOT "The money going into the slot machine is called coin in."

The primary point was that one person here insisted that PA casinos cannot compete because their gaming tax on slot win is 50+% vs 8% in NJ. He stated that PA casinos MUST be skimming profits, or that their slot machines do not pay out as much as NJ slots. I and others offered numerous links to verify that both of these assertions were factually incorrect.
OK, I understand. Sorry for the confusion.

Stan
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Old 03-23-2010, 01:55 PM   #122
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Re: AC need not worry about Philly/PA casinos

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Originally Posted by 2to1Underdog View Post
I personally know that I will play in Philly at Parx and Harrah's chester more often then heading to AC, the Borgata will still be my favorite poker room unless Parx really comes up huge. By huge I mean good crowds and good games. AC is just to far for day trips and such. Bring on the good games!!!!
Only one problem. Well, two -- Parx's application did not include any poker tables, and Harrahs hasn't even applied yet.

http://www.pgcb.state.pa.us/?p=170
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Old 03-23-2010, 04:39 PM   #123
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Re: AC need not worry about Philly/PA casinos

If the Jersey State Gov't had any brain power (not a given, by any means) They'd sacrifice AC, and open up gaming in other parts of the state. Think what kind of mint a casino in Jersey City would be? They could also strike back at PA by putting casinos just across the river from Philly, and at the Delaware Water Gap.

AC is dying anyway. Between the PA casinos, and, maybe, eventually, possibly Aquaduct, the lure of driving a couple hours to a faded beach town in the middle of nowhere just to gamble is fading quickly.
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Old 03-23-2010, 05:31 PM   #124
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Re: AC need not worry about Philly/PA casinos

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AC is dying anyway. Between the PA casinos, and, maybe, eventually, possibly Aquaduct, the lure of driving a couple hours to a faded beach town in the middle of nowhere just to gamble is fading quickly.
Really? So explain why every single weekend, even in the dead of winter, the casinos in AC are all so busy. Better yet tell me why all year long you cannot book a room in any of the AC casino hotels for less than $500 per weekend? (assuming you are not a rated high roller)

Sometimes I wonder if any of the people who write about AC have ever spent any time there? Most of you really dont sound like you know what you are talking about.
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Old 03-23-2010, 05:47 PM   #125
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Re: AC need not worry about Philly/PA casinos

Are you kidding?

Borgata, which most regard as the best casino/hotel in AC, has been giving away rooms FOR FREE mid-week to any one who has a Borgata Red Card. I had some minor slot play two years ago and I am getting this offer. That offer is proof AC is in deep trouble even before these Philly casinos are up and running.
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