The Clock Is Ticking: Counties Press Colorado To Reopen Casinos

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As the nation enters its fourth month in the fight against COVID-19, casinos in nearly a dozen states are gradually opening their doors.

At its peak, the coronavirus pandemic led to the temporary closure of all 989 casinos nationwide, comprising both tribal and commercial properties. As of June 4,  494 casinos had resumed operations, according to the American Gaming Association, with more than 100 reopening this week alone. In Colorado, however, retail casinos remain shuttered much to the dismay of county leaders in the historic mining settlements that host gaming in the state. Thousands of furloughed gaming employees are on edge as the casinos burn through millions in losses per month.

While Gov. Jared Polis has pledged to work with leaders from Teller and Gilpin Counties to safely reopen the casinos, the state’s “safer-at-home” guidelines appear fraught with inconsistencies. Last month, the Colorado Department of Public Health and Environment (CDPHE) partially approved a variance request from Teller County authorizing the reopening of restaurants, gyms, movie theaters and other non-essential businesses under strict guidelines. The Department, though, rejected the county’s request as it pertains to casino re-openings.

At the moment, it is unclear if any of Colorado’s 33 non-tribal casinos will reopen before the end of the month.

Variance requests

Teller County is home to a handful of casino properties in Cripple Creek, including Wildwood Casino, which bills itself as the highest casino in the world at 9,593 feet above sea level. On May 8, Teller County submitted an application to the CDPHE, requesting a variance to portions of Executive Order D 20 044 Safer at Home and Public Health Order 20-28 Safer at Home mandates. With casinos shut for most of the spring, the city of Cripple Creek has been unable to collect gaming-device fees and has seen sales-tax collections plummet due to state restrictions. Since the start of the pandemic, Cripple Creek has experienced a budget shortfall of upwards of $2 million, Teller County Commissioner Marc Dettenrieder told COBets.com. 

Unlike in some states which have given gaming regulators the authority to decide when to reopen casinos, the onus in Colorado has been left to the Health Department. The pressure may intensify this week as more states loosen restrictions on casinos. On Thursday, a host of Las Vegas casinos opened at 12:01 a.m., exactly one minute after the Nevada Gaming Control Board lifted a 12-week shutdown order.

As of June 4, approximately one-half of the nation’s casinos have reopened. (Courtesy: American Gaming Association).

Despite the need for expediency given the dire economic circumstances, it took the CDPHE two weeks to respond to the county’s request. When asked on the state’s casino reopening plans at a June 2 news conference, Polis noted that the Department’s average turnaround time on variance requests typically lasts around a week. In some cases, the governor said he has seen the CDPHE complete approvals in a period of three to four days, while the more complicated ones can take closer to a week. Given the backlog of requests, Polis emphasized that the CDPHE is responding to the requests as quickly as it can.

“As illustrated, in our case we waited a painful two weeks,” Dettenrieder said. “Based on what I’ve seen so far, there is some disconnect between the Governor’s office and CDPHE.”

Teller County submitted a casino-specific variance request on May 29, Dettenrieder said. The application, along with a separate variance request from Gilpin County, is still pending.

“We continue to work with counties to figure out plans for casinos,” a spokesperson from the Colorado State Joint Information Center wrote in an email to COBets.com. “This is not a statewide activity so we expect the nexus of action to be at the county level.”

The state also strives to be “deliberate with each and every variance request,” to ensure that its disease prevention experts have enough time and information to “diligently evaluate the data relevant to that county,” the spokesperson said.

Prioritizing safety upon reopening

After the CDPHE rejected the casino portion of Teller County’s application on May 22, a contingent of casino representatives met with the health department last week, Dettenrieder said. The casino reps have also been in contact with the Division of Gaming, he added. From all accounts, the meeting with the CDPHE went well.

The County presented an updated 20-page variance request with comprehensive social-distancing guidelines, mask requirements for all customers, and temperature checks upon entrance. Under the proposal, all table games with the exception of blackjack will not reopen immediately. At first, games such as poker, roulette and craps will remain closed.

When retail sportsbooks eventually open, Teller County does not anticipate encountering an inordinate amount of social-distancing concerns.

Newly authorized sports betting does not present any social distancing issues in Cripple Creek. In those casinos, sports betting is entirely operated through an ATM-like kiosk, accessed only by one customer at a time. There are no Las Vegas-type sports betting lounges in Cripple Creek. –Teller County casino variance request.

Six digital sportsbooks — BetMonarch, BetMGM, BetRiversDraftKingsFanDuel, and FoxBet — launched Colorado specific mobile apps in May over the first month of legal sports betting in the state. A seventh, Smarkets USA, is expected to make its Colorado debut soon. For the month of May, total unaudited, gross revenues for Colorado sports betting came in at $25.5 million, according to the Division of Gaming.

Counties recommend limited occupancy

Officials from Gilpin County, in which the gaming town of Black Hawk resides,  are also erring on the side of caution with their variance request. In its 50-page proposal to the CDPHE, the County recommends that casinos limit occupancy to 30% of the building’s occupancy code. Gilpin County Commissioner Ron Engles said the county could petition the state to increase the capacity limits if data indicates that new infection rates are low while customers demonstrate an appetite for returning to the casino floors.

An April study from the Wall Street Journal and USA Today found that Gilpin County will be the hardest hit  county in the nation by the economic downturn caused by the virus. Approximately 70% of the county’s revenues come from the gaming industry, the study determined.

“Certainly, the casinos wanted to open with higher capacity,” Engles told COBets.com. “When we put our public health hats on, we thought with the way restaurants are opening across the state people aren’t really confident coming in yet.”

Others believe that some political leaders on the state level have misconceptions on the gaming industry’s ability to maintain a safe environment inside Colorado casinos. One industry expert argues that playing a slot machine alone is considerably safer than congregating in other areas that have already been approved by the CDPHE.

“It’s far less social than eight people going to a restaurant together,” an industry source told COBets.

Casino tax revenue was $0

From an economic standpoint, county commissioners are urging the state to expedite its review. Colorado collected about $5 million in taxes from the state’s casinos in March, down from about $12.2 million in the same month a year ago. The state generated $0 over the last two months.

“Time is of the essence, we need to get all the businesses and industries open in Teller County based on the argument we submitted to the state,” Dettenrieder said. “We have a low case count and our facts on the ground support opening up.”

 

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Matt is a veteran writer with a specific focus on the emerging sports gambling market. During Matt's two decade career in journalism, he has written for the New York Times, Forbes, The Guardian, Reuters and CBSSports.com among others. In his spare time, Matt is an avid reader, a weekend tennis player and a frequent embarrassment to the sport of running.

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