Background

Background

In order to fully understand the economic climate, we conducted a review of Atlantic City’s portfolio, which makes it clear that the city is in immediate need of change.  Atlantic City’s population dipped below 40,000 people for the first time in half a century, reporting a 2.4% decline in population from the 2000 Census to the 2010 Census (US Census, 2010).  About one-third of the city’s residents live in poverty and more than two-thirds of its adults age 25 and older have a high school diploma or less.  In July 2014, its non-seasonally-adjusted unemployment rate was 13.9 percent, more than twice that of New Jersey’s as a whole (Griego, 2014).  The city’s total assessed property value was $20.5 billion in 2010 and has fallen to $11.3 billion as of July 2014, and is continuing to drop.  Four casinos have closed in the past twelve (12) months, resulting in more than 8,000 workers receiving pink slips.  Those jobs offered union-negotiated benefits, and many of those employees made careers out of them, buying houses and raising families in Atlantic City.  With casinos closing and workers losing their livelihood creates unimaginable ripple effects such as foreclosures, unemployment claims, and rising real estate taxes.   

Atlantic City’s decline began in 2007, a year after Pennsylvania opened gaming.  For decades, Pennsylvania residents had been one of the largest demographics flocking to Atlantic City’s casinos, but now faced with closer alternatives, those tourists elected to stay local and spend their gambling dollars in-state.  Just four years after opening, Pennsylvania would bump Atlantic City out of second place in annual gaming revenue.  In 2013 Pennsylvania’s annual gaming revenue was $3.1 billion and as they rose, Atlantic City fell from a peak $5.2 billion in gross casino revenues to $2.8 billion in 2013.  Beginning in the 1970’s, Atlantic City had a broad monopoly in the North East gambling market.  However since 2001, nine (9) more states have opened casinos. Since 2006, revenue has fallen more that 45 percent (McCarthy, 2014).

Atlantic City, once a booming city in its peak, now ranks at the bottom of most social and economic indicators with the downfall of the local gambling industry and the rise in gaming in other states.  The issue in Atlantic City is that the city’s role within the gambling sector has been significantly diminished and is no longer producing the revenue the city has relied upon.  Atlantic City’s resorts are no longer the significant economic stimulator that they once were for the city. 

The city needs a new industry to be introduced to revitalize the economy and the image of Atlantic City, and a world class sports facility at Bader Field is the answer.