The expected annual tax gains for Tuxedo generated by the planned casino are lower than predicted by the developer, concludes a study by consulting firm Alvarez & Marsal. Although the expected revenues are lower than promised, the firm says that market conditions favour the casino as it will generate positive economic results for the town and school district, both facing budget deficits.
A recent released study by Alvarez & Marsal (A&M) shows that the casino proposed by Genting Americas* in Tuxedo, New York, will bring less revenues and less traffic than the developer had estimated. The consulting firm had been hired by the Town Board and based its study on independent research and analysis of available data.
Genting Americas plans to build a $1.5 billion luxury casino resort on a 238-acre privately-owned site surrounded by Sterling Forest, which, according to the developer, will generate $25.4 million a year in annual tax gains for Tuxedo. However, according to the A&M’s research, with an estimated annual revenue of $1.1 billion, the generated annual tax gains for the city will be approximately $12 million in 2017 and nearly $19 million in 2026**.
Although these figures are significantly lower than the figures predicted by Genting Americas, they are still higher than the minimum of $10.9 million that the developer is legally obliged to pay Tuxedo under the host community agreement. The study also predicts a lower number of expected annual visitors (6.1 million) than the developer (6.9 million).
Responding to the divergences in figures, the consulting firm says that this could be the result of the unpredictable market. In conclusion, A&M says that the market conditions overwhelmingly favour the casino, as the town and the school district that currently both face large budget deficits, will be positively transformed by the casino.
* Genting Americas is an affiliate of the Genting Group; a global diversified set of companies.
** The figures are based on the assumption that no other casino's are built in northern New Jersey or New York City in the studied timeframe.