COVID-19 Restrictions Expanded in New Jersey for Another 30 Days

Atlantic City casinos, like many others across the country, have been operating under strict capacity limits and several health safeguards intended to keep customers and staff safe. It now appears that New Jersey punters will have to contend with these restrictions after New Jersey Gov. Phil Murphy extended the state’s health emergency for an additional 30 days until Feb. 18th, 2021.

The Governor has extended the public health emergency a total of 11 times so far and this shouldn’t be the last time. As long as the infection cases persist, it’s safe to say that the city’s 9 casinos will continue to operate at the established limited 25% capacity for the foreseeable future.

Under these restrictions, all guests and staff members must continue to wear their face masks. Customers will also have to gamble at reduced table games in order to adhere to social distancing guidelines. All the slot machine banks have also been re-arranged so that they are socially distanced and safe for use.

Indoor dining will remain open but the Governor has considered shutting it down to stop the rate of infection cases. However, absent of a new federal stimulus bill, shutting down indoor dining would devastate an already stressed system that’s been heavily affected by the hardship caused by the pandemic.

Among the restrictions that have impacted restaurant owners severely is the requirement that all businesses, including bars and restaurants, be closed by 10 p.m. every night. Eateries and drive-throughs in the state are only allowed to stay open for pickup and delivery until 11 p.m. the city is responsible for enforcing the mandates given by the Governor. However, the states and municipalities themselves are supposed to implement even stricter rules designed to control non-essential businesses.

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The brick and mortar casinos have suffered immensely and these restrictions and recovery from the pandemic-induced recession will take years. The contagion has impacted the state budgets on all fronts and the government is doing all it can to shoulder the burden of the growing medical and unemployment expenses while also facing an intense decline in tax receipts, particularly from the brick and mortar casino market.

Every state in the country is dealing with similar issues, not just the Garden State, which has the most thriving gambling industry in the country thus far. Online gambling and poker have helped considerably to shoulder the financial shortfall. But federal cash assistance is needed for the state to get back on its feet fully, as well as help the casinos and small businesses that have been severely affected.

The good news is that the inoculation process is already underway. Today, people aged 65 and older, as well as individuals aged between 16 and 64 suffering from high-risk medical conditions are now eligible for vaccination. Previously, only individuals 75 and older and essential frontline workers were eligible to receive the vaccine. As more and more New Jersey residents become eligible for the vaccine, it is expected that the Governor will loosen some of these restrictions.

 

So what can the world expect from the New Jersey gambling industry in 2021?

New Jersey gambling had a surprisingly good year amid a pandemic. Last year, the gaming revenue summed more than $2.88 billion. Although this may sound like an impressive number, the number represented a year-over-year decline of more than 17%. The city’s retail casinos, land-based and mobile wagering, as well as online gaming and interactive poker, suffered a collective loss of $587.2 million.

The revenue collected from slot machines and table games dropped 44% compared to last year. all the city’s 9 casinos were forced to shut down operations in Mid-march and did not re-open until July as we’ve discussed here. Borgata, which is usually the top earner in the market, did not re-open its doors until late July. Those that did open operated and continue to do so at 25% capacity, which has impacted operations severely.

Online gaming and sports betting were the city’s saving grace as we’ve covered here. Without revenue from both these verticals, New Jersey would have been worse off, as is evidenced by states that currently do not have regulated sports and online wagering. Internet slot machines and table games grew in popularity with interactive poker also growing quite a bit.

The Golden Nugget emerged as the biggest player in the iGaming market. Golden Nuggets online operations received a boost of 80% to reach $318.8 million. Resorts Digital is Golden Nugget’s biggest competitor so far, trailing in revenue at $208.5 million for the year.

Despite the retail casino sector continuing to struggle all through, the Garden State unsurprisingly emerged as the leader in sports wagering last year. In total, New Jersey gamblers bet more than $6 billion in wagers, and 92% of these wagers were done online. Of the sportsbooks in the state, the Meadowlands alongside its sports betting partner FanDuel emerged on top of the leaderboard followed closely by DraftKings and Resorts Digital.

Of the city’s 9 casinos, only 2 saw their gross revenue improve in 2020. But this situation should change in 2021. The vaccination is already helping to build up the demand for retail gambling. So this is great news for all other 7 casinos. That means that Bally’s, Borgata, Caesars, Hard Rock, Harrah’s, Ocean, and Tropicana all have a chance to turn around their fortunes before the year is out.

 

Final Thoughts

New Jersey is not close to being out of the woods as it regards the pandemic. As such, the expanded restrictions are important as they will only help to save more lives. Even though this comes at the expense of many businesses in the city, the expanded restrictions are non-negotiable, especially if the city wants to recover as quickly as possible.

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