September 29, 2024

Louisiana’s biggest casino market places another bet on gambling. Is it overplaying its hand? – The Advocate

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Guests packing the floor of the Horseshoe casino in Westlake on opening day, Dec. 12, 2022.
Construction workers finishing up installations on the floor of the Horseshoe casino in Westlake before its official opening, December 7, 2022.
A dealer laying out cards during a staff training session at the Horseshoe casino in Westlake ahead of its opening, December 7, 2022.
Jeff Favre, senior vice president and general manager of the Horseshoe casino in Westlake, on the balcony of the suite where he rode out Hurricane Laura in August 2020.
New staffers Carlotta Albro and Tina Williamson during a training session at the Horseshoe casino in Westlake ahead of its opening, Dec. 7, 2022.
Dealer Tory Derouen during a training session at the Horseshoe casino in Westlake ahead of its opening, Dec. 7, 2022.
Slot machines on the floor of the Horseshoe casino in Westlake before the official opening, Dec. 7, 2022.
Returning staff member Tory Derouen dealing cards during a training session at the Horseshoe casino in Westlake ahead of its official opening, Dec. 7, 2022.
The hotel tower and entrance of the former Isle of Capri casino, now rebranded as the Horseshoe, on opening day, Dec. 12, 2022.
Guests packing the floor of the Horseshoe casino in Westlake on opening day, Dec. 12, 2022.
Construction workers finishing up installations on the floor of the Horseshoe casino in Westlake before its official opening, December 7, 2022.
Dealer Tory Derouen during a training session at the Horseshoe casino in Westlake ahead of its opening, Dec. 7, 2022.
WESTLAKE — Southwest Louisiana continues to bet big on gambling.
The state’s biggest casino market, the Lake Charles area, is growing further with the return of a third casino, the former Isle of Capri. Destroyed by Hurricane Laura in 2020, the former riverboat is now reopening on land as the Horseshoe, adding over 700 jobs and further growing the over $1 billion tax base the industry contributes to the state budget.
Gambling accounts for about 10% of state general fund revenues. And the Lake Charles area, despite having only two active casinos after Laura, has continued to play an outsized role. Last year, the Golden Nugget and L’Auberge together paid $126 million in fees to the state, according to the state Gaming Control Board’s annual report.
The hotel tower and entrance of the former Isle of Capri casino, now rebranded as the Horseshoe, on opening day, Dec. 12, 2022.
Before Hurricane Laura hit, the Isle of Capri riverboat on the shore of Lake Charles had just submitted plans to become the first riverboat in the state to move onto land, something the Legislature voted to allow in 2018. Then the storm blew the riverboat into the I-10 bridge, wrecking it beyond repair.
On Monday, the rechristened Horseshoe opened and local business and government leaders hope it will drive more traffic to the area.
“The Lake Charles market has really become a destination point,” said Ronnie Johns, a former state senator and the current chairman of the Louisiana Gaming Control Board.
Located just 35 miles from the Texas border, local casinos draw most of their visitors from the Lone Star State, where gambling remains illegal. An estimated 75% of those gambling at Lake Charles casinos come from outside the area.
Lucious and Aundria Barnum drove from Houston and braved a line of cars snaking eastbound toward the casino to try their luck on opening day. “We wanted to get in on the action,” Aundria Barnum said. “Hopefully we’ll win some money.”
The two said they hope that one day their state will legalize gambling too. “Until then, we’ll keep driving.”
Slot machines on the floor of the Horseshoe casino in Westlake before the official opening, Dec. 7, 2022.
The dependence on Texan gamblers has raised some concerns in Lake Charles over the possibility of legalization next door. “It’s something that we monitor very closely,” said Johns. “It would have just a huge impact.”
While he’s confident that Texas will legalize some form of gambling one day, Johns doesn’t think it’s coming any time soon. “It’s not a state that’s looking for a source of revenue,” Johns said.
The recent legalization of sports betting has allowed the Lake Charles casino market to add another lucrative attraction to its portfolio. In 2021, new sportsbooks opened at both the Golden Nugget and L’Auberge. The new Horseshoe will feature a sportsbook operated by Caesars.
Sports betting was too new to be included in the gaming board’s most recent annual report, but according to Johns, it had generated $27 million in revenues for the state through October 2022.
A dealer laying out cards during a staff training session at the Horseshoe casino in Westlake ahead of its opening, December 7, 2022.
State and local governments share those proceeds. “The gaming sector of the economy is an important aspect of our local revenues,” said Calcasieu Parish Administrator Bryan Beam. “The casinos here have been a definite positive in terms of economic impact.”
That impact goes beyond just the taxes and fees casinos pay, which fund a plethora of state programs like early childhood education and local capital improvement projects.
“It straddles a whole bunch of different industries,” said Dan Groft, director of the H.C. Drew Center for Business and Economic Analysis at McNeese State University. “There’s benefits and costs, but most people would argue that the benefits far outweigh the costs in terms of economics.”
Gambling addiction, although rare in the overall population, can spell financial ruin for individuals who suffer from it.
The casinos and adjacent hotels, as well as the restaurants, bars and retail stores housed within the properties, provide thousands of jobs in the Lake Charles area alone.
Tory Derouen is one of over 700 employees that were being trained ahead of the Monday opening of the Horseshoe. Derouen met his wife, a cocktail waitress, at L’Auberge. Their work at the local casinos has paid for the house the couple and their three children live in, a new car and daily expenses.
Returning staff member Tory Derouen dealing cards during a training session at the Horseshoe casino in Westlake ahead of its official opening, Dec. 7, 2022.
“It’s one of the top jobs in the area. If you don’t work at the plants, you work at the casino,” Derouen said. He enjoys it. “It is a fun job,” Derouen said. “All you gotta do is show up.”
Getting the new casino ready has been no small feat. First, the pandemic slowed down the process of moving the operation onto land, and then Laura blew the entire site to bits.
“It’s been a rough ride,” said Jeff Favre, the casino’s senior vice president and general manager.
Jeff Favre, senior vice president and general manager of the Horseshoe casino in Westlake, on the balcony of the suite where he rode out Hurricane Laura in August 2020.
But, he added, the hard work was well worth it. “We’re not the same property that we were before.” In addition to being the first riverboat in the state to move onto solid ground, the hotel tower is being completely redone, and will eventually bring back 253 much-needed hotel rooms to the area.
The lack of rooms has driven up nightly rates to record highs. While that’s good news for individual hotels, like the Golden Nugget and L’Auberge, it presents a challenge for the local tourism and hospitality industry.
“We just can’t house as many visitors as we did before the storm,” said Kyle Edminston, president and CEO of Visit Lake Charles, the local conventions and visitors bureau.
Any additional hotel rooms help the local tourism sector, Edminston said. “All of these properties are only going to benefit our entire community by getting more visitors into our community.”
There have been some concerns that the Horseshoe’s reopening might cannibalize the local gambling market, rather than growing it. But Edminston and others are confident it will attract more visitors. “I think there’s certainly more demand than can be supplied by the three that have been open,” he said, referring to L’Auberge, the Golden Nugget and Delta Downs, a racetrack with slot machines in nearby Vinton.
New staffers Carlotta Albro and Tina Williamson during a training session at the Horseshoe casino in Westlake ahead of its opening, Dec. 7, 2022.
Beam shared a similar view. “There were questions about whether this market could justify this many casinos, and everything that’s been added has verified that it can,” he said. “Even though they will take some customers from the other casinos, it will be a net increase in the gaming market here.”
Even if Texas were to legalize, gaming market experts say the Lake Charles casinos’ amenities, from lazy rivers and spas to high-end restaurants and bars, might make it enough of a destination for people to take the trip anyway.
“The Lake Charles market would have to adapt,” Johns said, saying moving riverboat casinos like the Horseshoe onto land is a step in the right direction. “People like to travel,” he said. “They’ll become actual destination facilities.”
Email Alena Maschke at alena.maschke@theadvocate.com
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