Gaming Commission chair predicts rebound by '07 for coast casinos

By Emily Wagster Pettus

Associated Press

TUNICA, Miss. (AP)_ The chairman of the Mississippi Gaming Commission says the state's Gulf Coast casino industry should reach its pre-Hurricane Katrina level of jobs, gambling revenue and tax payments by late 2007.

"That's at an absolute minimum," Jerry St. Pe said Friday at the Southern Gaming Summit. "The more likely scenario is that by the end of '07 those factors will be exceeded.

"Most of the discussion Friday at the casino industry gathering centered on the lingering impact of Katrina, which walloped Mississippi's 12 coastal casinos and destroyed thousands of homes and businesses when it struck Aug. 29. The storm's powerful surge lifted massive casino barges like toy boats, tossing some of them on top of buildings onshore.

Three Biloxi casinos are back in business and Mayor A.J. Holloway said he expects four more to be open in his city by the end of this year.

Gaming industry analyst Carlton Geer of Las Vegas estimated that Biloxi's casino market will take until 2008 to recover to pre-Katrina levels. Revitalization, he said, will depend on the number of hotel rooms that reopen to accommodate tourists. Only about 23 percent of the market's rooms are back up now, he said.

Mississippi legalized dockside casinos in the early 1990s, limiting them to the Gulf of Mexico and the Mississippi River. The first gambling boat opened in Biloxi in August 1992.

Weeks after Katrina, Gov. Haley Barbour persuaded legislators to allow coast casinos to develop 800 feet on land as long as they still have part of the casino touching the water. The rules for the Mississippi River casinos did not change.

St. Pe traveled to Las Vegas a few days after Katrina to meet industry leaders and he said Friday that they wanted to know two things_would Mississippi allow casinos to move off the coastal waters and out of harm's way and would the state refrain from increasing tax on the industry.

St. Pe said he believes if the state had not allowed the coast casinos to move onshore, the industry would have returned as "only a fraction of itself."

Several speakers at the summit emphasized the possibilities of new development amid Katrina's destruction.

"There's probably never been a greater time for any type of development, particularly gaming, in Biloxi than there is now," said Ron Hartley, senior project manager for the Biloxi Bay Dale/Morris Architects.

Geer said the coast gaming market now has an opportunity to create a "wow factor" with eye-popping hotels and resorts.

State Sen. John Horhn, D-Jackson, recently became chairman of the Gaming, Sports, and Entertainment Committee for the National Black Caucus of State Legislators. On Friday, Horhn said the casino industry had been making strong efforts before Katrina to have more contracts with small businesses and female or minority-owned firms. He said he hopes those efforts don't become an afterthought during rebuilding.

"The last thing the gaming industry wants is to be compared to FEMA," Horhn said, citing early statements by the Federal Emergency Management Agency that it could not find Mississippi businesses to clean up hurricane debris.

The Southern Gaming Summit had been held on the Gulf Coast for the past decade, but Katrina's destruction forced the gathering to move 370 miles north to the opposite end of the state.

Casino industry vendors showed off the latest in black jack tables and neon-lit slot machines on the floor of the Tunica Arena and Exposition Center, a gleaming new hall that normally hosts livestock shows and cheerleader competitions.

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