Letter From The President Of The International Association Of Gaming Attorneys

2006-09-01 01:00

To The Readers Of The Metropolitan Corporate Counsel :

Hurricane Katrina roared ashore in the summer of 2005, damaging every casino on the Mississippi Gulf Coast, and, together with Hurricane Rita, damaging 11 of Louisiana's 19 casinos. Much has happened in both states since those storms, and the gaming industry has begun 'rebuilding' in earnest.

The Mississippi State Legislature passed House Bill 45 ('HB 45') legalizing gaming in certain onshore structures located in Harrison and Hancock Counties. Some pre-Katrina licensees have already utilized HB 45 to reopen in onshore locations and others are expected to follow suit. Although a majority of Mississippi's pre-Katrina Coast casinos remain closed (some, perhaps permanently), the five that have reopened as of the date of this letter are enjoying significant success. A Mississippi State Tax Commission report lists gross gaming revenue for the Gulf Coast counties for the period from January to June 2006 as totaling approximately $374 million - and not all five casinos were open for the entire reporting period. Three additional pre-Katrina licensees and the reincarnation of a fourth pre-Katrina licensee are expected to reopen or open their doors soon, some later this month. Also, one casino project well underway but shy of licensure prior to Katrina plans to open this fall.

Three of the original 11 properties in Louisiana affected by the storms remain shuttered. Although these three licenses have been inoperable for almost a year and the New Orleans land-based casino was closed for almost six months, Louisiana casino gaming revenues for the fiscal year ended June 30, 2006 (excluding Native American casinos) grew an astonishing $164 million or about 7.3 percent. This growth may have been fueled, in part, by clientele unable to patronize inoperable Mississippi Gulf Coast casinos and an influx of temporary construction workers.

As president of the International Association of Gaming Attorneys and the manager of Phelps Dunbar's gaming practice in Mississippi and Louisiana, I am mindful of the gaming industry's importance to the economy of the Gulf Coast region. The past several months have proven that the gaming industry remains strong and dynamic, able not only to adapt to changing circumstances but also to evolve in the appropriate regulatory environment. This ability bodes well for the recovery at large of the Gulf Coast region.

Sincerely,

Dan M. McDaniel, Jr.