A Calculated Gamble for Coney Island

By Ezra Doueck

For decades, when the scorching city heat baked the paved streets of New York City, swarms of urban refugees headed to the Atlantic coastline, and particularly to Coney Island, to cool off on the shore.

There, they could enjoy the water and the breeze on the boardwalk, while joining the crowds of thousands, sometimes tens of thousands, enjoying music, children’s laughter and the warm smell of saltwater in the air. From the famous Cyclone rollercoaster to the original Nathan’s (still home to the annual hotdog-eating contest), Coney Island was a beloved destination.

Established in 1916, Nathan's is perhaps the best-known hotdog restaurant in the world. Photo by Emma Kazaryan
Established in 1916, Nathan’s is perhaps the best-known hotdog restaurant in the world.
Photo by Emma Kazaryan

But over the course of several decades in the mid-20th Century, Coney Island fell on hard times, a victim of rising crime rates and increased poverty in surrounding neighborhoods.

Now local policymakers are excited by a plan to expand casino gambling in New York State, hoping to build a full-service casino in Coney Island and restore the area’s luster. A decision on whether to put a casino in Coney Island is at least seven years away, but the proposal has already generated intense debate within the historic neighborhood.

Coney Island, a densely populated peninsula in southern Brooklyn, attracted millions of visitors in the early 20th Century. For decades, it was known for its amusement parks and boardwalk. Yet, over time, the amusement parks closed one by one, and local officials and investors offered a string of revival schemes through redevelopment. Robert Moses in the 1940’s, Fred Trump in the 1960’s and Mayor Rudolph Giuliani in the 1990’s were among them.

The latest such attempt is the plan for a casino, one of seven to be built throughout New York State. The locations have not yet been designated, and other New York City sites are being discussed by the New York State Gaming Commission.

The plan is already a deep source of controversy.

“If you want to see crime go up, if you want to see traffic go up, if you want to see small businesses go out of business – then support the casino,” said City Councilman David G. Greenfield, a vociferous opponent of the proposal, in a news release, “But if you care about the community, we must join together and stop the Coney Island casino.”

Casino advocates point to job creation and economic stimulation, and include powerful politicians, such as Sheldon Silver, Speaker of the New York State Assembly; Marty Markowitz, until recently the Brooklyn Borough President, and Gov. Andrew Cuomo, who put forward the original plan to create seven casinos, which won the approval of 60 percent of voters in a November referendum.

“The votes are in,” stated a news release from NY Jobs Now, a PAC that has raised nearly $4 million from supporters of the proposal, “And New Yorkers – business and labor, Democrats and Republicans – have come together to bring billions of dollars back to our state, create thousands of good-paying jobs and generate hundreds of millions of dollars in new revenue for schools and local governments.”

In the first phase of the state plan, four casinos will be built upstate by Fall 2014, in the Catskills, the Capital Region near Albany and the Southern Tier along the Pennsylvania border. After a seven-year moratorium period, three New York City borough casinos will be approved, one of which may be in Coney Island.

Coney Island's famous Boardwalk, bustling in summer, stretches for 2.5 miles along the shoreline. Photo by Emma Kazaryan
Coney Island’s famous Boardwalk, bustling in summer, stretches for 2.5 miles along the shoreline.
Photo by Emma Kazaryan

According to a New York Times/Siena College poll published in October, nearly 72 percent of New Yorkers feel that the casinos would bring significant new revenue to New York State, which currently has a $2 billion budget deficit. In his campaign to win public support, Cuomo promised rapid job growth, increased aid to education, boosted tourism and lower property taxes as an expected result of the new casinos.

Opposition groups, such as the Stop the Coney Island Casino Organization, say that placing a gambling casino in a residential area will increase crime and compulsive gambling, depress the local economy and lead an overall deterioration in quality of life in the neighborhood. And, overall, there may be a NIMBY effect – people support the notion of a casino, but “not in my back yard.”

The gambling industry (which prefers to be called the gaming industry) has grown enormously in the United States and worldwide. In the U.S., the industry had nearly $40 billion in revenue in 2012 and said it employed more than 334,000 people nationwide. Forty-seven states now permit gambling, and surveys have found that 34 percent of Americans visited a casino in the past 12 months.

The referendum in November approved a new approach to casinos in New York State, permitting “live games” with human dealers. In 2001, the state approved what are known as “racinos,” casinos paired with horse-racing tracks that are permitted only to have computerized gambling.

Locally, there are racinos at Aqueduct Race Track in Queens (the Resorts World Casino) and at Yonkers Raceway (the Empire City Casino). Both are very successful.

As of Aug. 1, the Resorts World Casino in Queens had sent more than $329 million in taxes to the state, including about $210 million allocated for education, according to Resorts World spokesman Stefan Friedman. The casino has also created 1,750 permanent jobs, with a large majority from the neighboring Queens community.

Since 2011, the New York State gambling market has experienced a 43.1 percent increase in gross revenue, to $1.8 billion, with more than 5,200 full-time casino employees.

Many vacant lots dot Coney Island and cry out for economic development, casino supporters say. Photo by Emma Kazaryan
Many vacant lots dot Coney Island and cry out for economic development, casino supporters say.
Photo by Emma Kazaryan

This attempt to bring gambling to Coney Island is not the first.  In the late 1970’s, private investors proposed gambling casinos, as in Atlantic City, N.J. The plan backfired; a land boom was created at the prospect of a casino, then the state legislature failed to legalize gambling, leading to vacant lots and abundant disappointment.

Those lots are still empty today. Markowitz says a casino would transform Coney Island into “the city’s premier year-round amusement and seaside entertainment destination.”

Every year, more than $3 billion is spent by New Yorkers in neighboring states’ casinos. Casino supporters think local casinos would keep that spending at home, while also attracting tourists from nearby states.

According to the Empire State Development Corporation, the introduction of new casinos would provide nearly 10,000 construction and permanent jobs, $1.6 billion in construction spending and nearly $420 million in tax revenue for the state.

“Granted, there are areas that are in need of economic revival,” Brooklyn resident Isadore Betesh said in an interview. “In places such as Coney Island, I can speak as a consumer to say that new, modern, and upscale entertainment venues will only help in attracting visitors to the area, no doubt helping local businesses in the process. With so much money being spent by New Yorkers in surrounding states, it only makes sense that we should try to draw that revenue back in. As of now, they were getting all the revenue, and we were just getting the addictions and complications that come with it.”

While there is little argument that casinos generate revenue, their impact is on surrounding communities is unclear.

In the 1990’s, a study at Iowa State University found that among small local business owners near a riverboat gambling facility in Clinton, Iowa, 12 percent reported an increase in business, 29 percent reported a decrease, and 60 percent no change at all.

The recently renovated Parachute Jump is the sole remaining attraction of the demolished Steeplechase Park. Photo by Emma Kazaryan
The recently renovated Parachute Jump is all that remains of the demolished Steeplechase Park.
Photo by Emma Kazaryan

“When people go to a new casino with six different gorgeous restaurants in it,” said Sam Sutton, a long-time resident of the Gravesend section of Brooklyn and an activist in the Stop the Coney Island Casino Organization. “There is no reason for them to ever go outside the casino, to local businesses. If you look at the casino in Queens, and if you look one block out from the casinos in Atlantic City, the local neighborhoods are bleak. There’s no doubt about it.”

Atlantic City once had a median family income of $34,000 in 1980. In 2010, it was $35,000, a minimal improvement. In the mid-90’s, proprietors of casinos in Gary, Ind., promised a swift revitalization of the depressed community; median household income in Gary is lower than it was 20 years ago.

“We are dreading the possibility of a casino being built nearby,” Sutton continued, “Casinos bring a certain kind of element to the area, and they bring certain types of people. They bring crime and gambling addictions and prostitution…why do we need that? And to think that a community kid can literally get on a bicycle and ride 10 minutes away every night to get involved with all of that—it would be a complete fiasco!”

Some research has found that crime increases after casinos are opened. Earl Grinols, an economist at Baylor University, in a national study published in 2006, found that within five years of a casino opening, robberies in the area increased 136 percent, auto theft by 91 percent, burglary by 50 percent, larceny by 38 percent and rape by 21 percent. A study published in 2005 by the University of Buffalo’s Research Institute on Addictions found that a person’s chance of becoming a gambling addict doubles if he or she lives within 10 miles of a casino.

From house to house and store to store in Coney Island, the casino remains hotly debated.

“Absolutely, let’s keep casinos out of Coney Island,” said a local shop owner, who spoke tongue-in-cheek and only on the condition of anonymity, “And while we’re at it, let’s close down all the bars too, because some people have a drinking problem, and let’s turn it into a pedestrian mall like Times Square, so no one will have a car accident. Nathan’s? That can close down too…way too much fried food. Close the ballpark, too, so nobody gets hit by a foul ball. And the Cyclone? A public health menace for sure– it can cause dizziness! Or, we could just let adults make their own responsible decisions.”

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