Major Hurricane Would Devastate Mississippi’s Coastal Casino Industry

Wed January 19, 2005 - Southeast Edition

BILOXI, MS (AP) A major hurricane would devastate the casino industry on Mississippi’s coast, putting people out of work for a year and costing the state about $141 million in revenue, a preliminary report concluded.

The Sun Herald newspaper reported the conclusion was reached by members of the Mississippi Ad Hoc Gaming Committee, comprised of coastal and governmental interests, in a yet-to-be-released report.

The committee weighed economic numbers, engineering studies, environmental impacts and legal issues to examine how gambling barges can be protected from storms.

The preliminary report was dated Jan. 3 and was to undergo a final revision before being mailed to legislators, The Sun Herald reported.

“I think the significance of this is that it is the first time that these kinds of projections have been put together based on sound engineering data,” said Bill Walker, chairman of the committee and the executive director of the state Department of Marine Resources. “These are not just guesses. These are engineering estimates that are then converted into economic losses.”

Since casino construction began on the Gulf Coast in the 1990s, local and state officials have feared the havoc a hurricane on the scale of Camille would inflict on the high-rise hotels and floating gambling barges. Camille, a Category 5 killer, struck the Mississippi coast in 1969 with winds topping 200 mph.

State law says casinos can locate along the Mississippi River or the Mississippi Sound or tributaries that connect to the bodies of water. Most barges sit in man-made lagoons, or cofferdams, connected to the main body of water.

The Mississippi Ad Hoc Gaming Committee was to make recommendations on how gambling barges can be protected from storms.

The Sun Herald said the options for better protecting casinos may require amending the state’s dockside gambling law.

The committee’s suggestions:

• Coffer cell enclosure: This protective shell could give better control of water levels and shield casinos from wave action.

• Pile-supported or jack-up barges: Casinos would be put on pilings or have lift mechanisms installed to elevate them during periods of high water.

• New conventional construction on pilings: New casinos would be built on pilings over state-owned water bottoms.

• Stationary on-land casino operations: New casinos would go on land immediately adjacent to state-owned water bottoms.

The report estimated that the period land-based casinos would be closed for repairs from a category 4 or 5 hurricane would be 91 days. This compares to 122 days for construction on pilings and 275 days in a coffer cell. A hurricane of this magnitude could close the present gambling barges for a full year.

There had been concern from state politicians and others that on-land casinos would infringe on neighborhoods and business districts. The report uses the phrase “immediately adjacent” to state-owned bottom lands.

“This option is not meant to imply movement of gaming activities to locations apart or any significant distance from areas presently approved for these activities,” the report said.

Another concern with this option is that casinos would no longer have to pay tidelands leases to the state, which fund conservation efforts, environmental education and public piers and parks.

“The committee as a whole recognizes the importance of the Tidelands Trust Fund to coastal Mississippi and feels that this fund should be protected,” the report said. “Should decisions be made that would move gaming operations away from state-owned water bottoms, a process similar to the Tidelands Trust Fund should be put in place to assure continued revenue to coastal Mississippi.”

Secretary of State Eric Clark, who organized the committee and is the steward of the tidelands program, opposes the land-based option.

The committee will disband once the report is published.

Committee member Jerry St. Pe’, who is the chairman of the Mississippi Gaming Commission, said he hoped legislators and other public policy-makers will put the report to good use.

“This report represents the first time that the public is going to be able to see not only the significance of this industry to the local and state economies but also clearly understand that it is fragile because of the circumstances we face on the coast each year with hurricane season,” he said. “There are some things that can be done to significantly reduce that risk.”