Parx, Mount Airy Show rewards possible non-smoking income
A curious thing happened when regulators in Pennsylvania allowed casinos to reopen their gambling halls to smokers on June 28, after a restriction on COVID-19 precautions and mask warrants were lifted.
Two casinos – Parx and Mount Airy Casino Resort – have independently chosen to continue to keep their smokers outside, despite long-standing claims by the Pennsylvania casino industry that the loss of customers’ smoking privileges could reduce gaming revenue.
Two more – Rivers Philadelphia and Live! Philadelphia – were required by the Philadelphia Department of Health to resume smoking bans shortly after the state restriction was lifted.
At 11 casinos, including the new Hollywood Casino York which opened in August, smokers can take a breath of the game today. Under state law that exempts casinos from the public smoking bans in the Pennsylvania Clean Indoor Air Act of 2008, each casino has the flexibility to allow smoking on up to 50% of the area. stake, although some maintain it at a share of less than half.
Lobbying efforts in New Jersey, led by casino workers and groups opposed to public smoking as a health risk, stepped up this year in an attempt to remove that state’s similar allowance for smoking. The nine Atlantic City casinos can smoke up to 25% of the playing surface, and so far the campaign to remove this option has been unsuccessful.
The same level of public outcry against smoking in casinos has not happened in Pennsylvania, where bills introduced over the years to lift the exemption have repeatedly failed to gain popularity. An advocacy group, Americans for Nonsmokers’ Rights, pointed out the most recent revenue figures for state casinos, however, suggest that they show that gambling properties would not suffer from a permanent statewide smoking ban, based on the financial performance of Parx and Mount Airy.
Paris Penn decided to take a closer look at the relevant numbers to see if this could be true.
It is difficult to distinguish specific income factors
It can be difficult to separate all the factors that affect the casino’s revenue and those that could create more traffic in one property while decreasing it in another. The smoking ban that existed everywhere in the first half of 2021, for example, was linked to many other COVID-related restrictions that reduced capacity, alcohol availability and the number of operating slots, and those- these were all lifted in June as well. .
Also in Pennsylvania’s case, the opening of three new casinos in the past year – Live! Pittsburgh last November, Live! Philadelphia in January and Hollywood Casino York three months ago – are expected to siphon off income from other properties closest to them. There is also a potential impact on attendance at the state’s online casino gambling retail casinos, which reached a record high of $ 102.9 million in October.
And then there’s the underlying uncertainty about the lingering effect of public concerns about health and finances related to the COVID outbreak. This is in addition to the ongoing impact on the casino’s monthly revenue from weather, real estate renovations, road construction, how the calendar falls, or other factors.
But by all accounts Parx and Mount Airy casinos have performed well this year, with or without smoking, compared to their competitors; Rivers Philadelphia saw a sharp drop in revenue, possibly due to new competition from Live! Philadelphia a few kilometers away; and the nine long-standing casinos that operated with smoking bans in early 2021, but are re-allowing it now, are doing better than before June 28.
It is difficult to identify the extent to which smoke-free policies are specifically responsible at these nine casinos for which comparisons can be made before, during and after the smoking ban: Harrah’s Philadelphia, Hollywood Casino at Penn National, Hollywood Casino at The Meadows, Lady Luck Nemacolin, Mohegan Sun at Pocono Downs, Presque Isle Downs & Casino, Rivers Pittsburgh, Valley Forge Casino Resort and Wind Creek Bethlehem.
A closer look at the numbers
Here are some month-to-month comparisons of slots and table game revenue at different casinos:
June 2021 (compared to June 2019)
Parx: $ 52.7 million (+ 7.6%)
Mount Airy: $ 15.4 million (-2.5%)
Philadelphia Rivers: $ 18.5 million (-24.2%)
Nine smoking casinos present: $ 146.6 million (-17.8%)
With the exception of Parx, still the busiest casino and the leader in state revenue, all state properties were in trouble compared to the same month two years earlier – before there was has an impact of COVID or related restrictions, including on smoking.
July 2021 (compared to June 2021)
Parx: $ 58.5 million (+ 11%)
Mount Airy: $ 20 million (+ 29.9%)
Philadelphia Rivers: $ 23.6 million (+ 27.6%)
Nine smoking casinos: $ 176.1 million (+ 20.1%)
All casinos flourished in July, the first full month in which indoor smoking was again allowed. The state set an overall gaming revenue record at the time of $ 423.7 million, including $ 309.8 million in slot machine and retail table revenue at the 14 casinos then in operation. activity.
The revival of smoking may have helped the nine places that allowed it, but Mount Airy still increased its income without it, by almost 30%.
October 2021 (compared to October 2019)
Parx: $ 52.2 million (+ 2%)
Mount Airy: $ 16.2 million (+ 3.8%)
Philadelphia Rivers: $ 18.6 million (-25.6%)
Nine smoking casinos: $ 171.5 million (+ 1.9%)
With the exception of Rivers Philadelphia, again affected in the comparison by having to share a newly competitive market with Live! In Philadelphia, casinos – regardless of their smoking policies – appear to have stabilized in financial performance slightly ahead of pre-COVID operations.
Overall, the state’s gaming industry set a new record in October, at $ 425.9 million, but that was with less retail revenue ($ 292.4 million) than in July, as the summer vacation months tend to attract more casino visits.
What does this mean for the future?
When the Pennsylvania Gaming Control Board’s October revenue report came out, Americans for Nonsmokers’ Rights cited Parx’s continued success – and high numbers statewide despite four casinos being without. smoke – as proof that the need to smoke to protect income is a myth.
“Operating smoke-free is good for business,” said Cynthia Hallett, president and CEO of the advocacy group. “We applaud the Pennsylvania casinos who have chosen to protect their employees and have also recognized the business benefits of creating a smoke-free environment that most casino visitors prefer. “
Many states other than Pennsylvania and New Jersey ban smoking in casinos, and Hallett noted that it is now banned in nearly 1,100 gambling properties nationwide. That number increased during the COVID era, with many tribal casinos having kept bans intact first established due to health concerns related to the pandemic.
Paris Penn contacted Parx representatives for comment on their smoking policy and its impact, but no response was received. In a recent article through CDC Games Reports, Casino Marketing Director Marc Oppenheimer said, “We did it for the health and comfort of our customers and team members. We have received significant positive feedback from both ridings. And [we] continued our good performance and our market share gains in the region. From now on, we hope to be able to continue to remain a non-smoking indoor facility. “
Glenn Cademartori, vice president of marketing for Mount Airy, made a similar statement to Paris Penn to ensure the “health and well-being” of employees and guests.
“The feedback has been overwhelmingly positive from both the former and the latter, and smokers and non-smokers alike,” he said. He noted that many job seekers have expressed interest in working in a non-smoking environment.
“In recent months, there has been no noticeable change in visits due to the continued restrictions,” Cademartori said.
This does not mean that Pennsylvania lawmakers are more likely to end the smoking exemption than they have been since 2008. The issue has not yet been considered a priority for either. other of the chambers controlled by the Republicans. Perhaps the most timely question is whether any casinos are looking at the Parx and Mount Airy examples and voluntarily changing their ways.
None have publicly indicated their intention to do so so far. In reality, it may be more difficult for them to reverse current policy than to simply maintain the ban that had already been in place for many months, as Parx and Mount Airy did.