Casino proposals create an odd dynamic

PHOTOGRAPHER: Peter R. Barber

An architectural rendering of the redevelopment of the former Alco site in Schenectady.

Rush Street Gaming, the group proposing a casino in Schenectady, is talking with James Featherstonhaugh of Saratoga Casino and Raceway about a casino in Newburgh, Orange County.

In the Capital Region, Rush is going head-to-head with Featherstonhaugh, who is pitching a casino project in East Greenbush with Churchill Downs. But in Newburgh, they are discussing a possible casino together.

“I can confirm that we are having discussions with the folks at Rush Gaming and that those discussions center on the development of a casino in Newburgh,” Featherstonhaugh said in an interview on Monday.

Featherstonhaugh would not confirm if it’s a “partnership,” however. Operators for proposed casinos across upstate New York will be revealed after applications are submitted on June 30.

In Schenectady, Rush Street Gaming is working with the Galesi Group to build a $300 million casino — Rivers Casino at Mohawk Harbor — with a hotel, restaurants and apartments on the former Alco site between Erie Boulevard and the Mohawk River.

David Buicko, chief operating officer of the Galesi Group, said he is aware that Rush Street Gaming is in discussions with backers of the Newburgh project, but he isn’t concerned about their commitment for a casino in Schenectady. Rush Street Gaming officials also could not be reached for comment.

Rush and Galesi are facing competition from Featherstonhaugh’s casino proposal in East Greenbush. The Capital View Casino & Resort also has a $300 million price tag with a hotel and restaurants.

The proposed casino in Newburgh is a whopping $670 million project called the Hudson Valley Casino and Resort. Plans include a 500-room hotel, restaurants and an entertainment venue. It’s expected to create 2,500 permanent jobs.

The Hudson Valley Casino and Resort appears to be double the price and size of both the Capital View Casino & Resort and Rivers Casino at Mohawk Harbor.

“We’re friends over there and enemies over here,” Featherstonhaugh said of his relationship with Rush officials. He said the potential partnership would not affect their casino proposals in the Capital Region.

Casinos proposed in Orange County have become a growing concern among operators looking at sites in the nearby, but more disadvantaged, Sullivan County.

Two operators looking to build a casino in Sullivan County recently backed out of their bid citing potential competition from Orange County, which is closer to New York City.

Last week the state Gaming Commission sent a letter to Sen. John Bonacic, R-Mount Hope, who voiced concerns about fair consideration of a casino in the mid-Hudson Valley/Catskill area.

The commission’s acting director, Robert Williams, wrote that the competition and applications were “carefully structured to ensure that higher need areas like Sullivan County could compete fairly against geographically advantaged areas like Orange County.”

“The intent of the Upstate New York Gaming Economic Development Act of 2013 is to provide maximum benefit to the state through bringing economic benefit to municipalities that have been economically disadvantaged,” he added.

Orange County has 11.7 percent of residents living below poverty level with a median household income of $70,712. In Sullivan County, 17.2 percent live in poverty with a median household income of $48,050.

Of all the sites being proposed for a casino in the Capital Region, Montgomery County is the most economically depressed with 19.2 percent of residents living below poverty and a median household income of $42,830.

Schenectady County has 12 percent of residents below poverty level and a median household income of $56,445. But the city has 22.5 percent below poverty and a median household income of $38,485. That’s compared to 3.5 percent poverty in East Greenbush and a median household income of $75,986.

“For those proposed locations that are more affluent, a project would have to provide a considerably greater overall direct and residual economic benefit to the host municipality and surrounding region than a smaller project sited in a disadvantaged region,” Williams wrote.

The Gaming Commission’s request for applications does not frown upon an operator vying for multiple casino licenses in different regions of the state. But the operators have to pay a $50 million licensing fee for each site.

That means Featherstonhaugh or Rush Street Gaming could be awarded two licenses, one in the Catskills region and one in the Capital Region.

Applications for a casino license are due by next Monday. Four licenses will be awarded to three upstate New York regions — the Capital Region, mid-Hudson/Catskills and the Southern Tier.

The Capital Region has five locations proposed for a casino — Amsterdam, Cobleskill, East Greenbush, Rensselaer and Schenectady. The Gaming Commission’s Facility Location Board will choose sites in the fall.