Detroit's three casinos allowed to partially reopen Aug. 5

After shutdowns that began in March to mitigate the spread of COVID-19, Michigan Gov. Gretchen Whitmer issued Wednesday an executive order authorizing Detroit's three casinos to open at greatly reduced capacity on August 5.

Under Whitmer's new executive order, capacity at the MGM, Greektown and Motor City casinos will be limited to 15%. The Detroit casinos have been at a competitive disadvantage because many of Michigan's tribal casinos — which are not under state jurisdiction — reopened with special precautions weeks ago.

Casinos must conduct a daily entry screening protocol for customers and employees, including temperature screening. Casinos also must require patrons to wear a face covering, except while eating or drinking or for identification purposes, the release said.

But Whitmer is also dialing back economic reopening in northern Michigan, reducing the size of groups allowed to gather and banning indoor alcohol sales in nightclubs and other establishments that mostly serve alcohol, with little food, Detroit Free Press reports. Both changes are effective Friday.

Both the size of indoor gatherings Up North, now limited to 10, down from 50, and the restrictions on indoor alcohol sales match restrictions that are already in place in central and southern Michigan.

"As we see COVID-19 cases continue to rise, Michiganders cannot afford to drop our guard," Whitmer said in a news release.

"After seeing a resurgence in cases connected to social gatherings across the state, we must further limit gatherings for the health of our community and economy. By taking these strong actions, we will be better positioned to get our children back into classrooms and avoid a potentially devastating second wave."

Outdoor gatherings are limited to 100 people, though a higher limit of 250 people outdoors will remain in effect in the Upper Peninsula and northern Lower Peninsula, Whitmer said.

Michigan's economic reopening has been on pause for weeks, amid rising coronavirus case numbers.

The Upper Peninsula and northern Lower Peninsula remain in Phase 5 of Whitmer's six-phase reopening plan, while the rest of the state remains in Phase 4. Gyms, movie theaters, and various entertainment venues are among the businesses that can be open in Phase 5, but not in Phase 4.

Alex Calderone, managing director of the financial consulting firm Calderone Advisory Group, based in Birmingham, said reopening at 15% capacity is potentially helpful for Detroit's casinos, but "Michigan may be playing it too safe."

Detroit casinos have laid off thousands of workers during the pandemic, and it is unlikely many of them will return to work with the casinos operating at greatly reduced capacity.

"Given that operating expenses have been slashed so drastically, it is possible they will be able to operate profitably, even at lower revenue levels driven by the 15% capacity restriction," Calderone said.

Still, the restrictions will mean continued economic pain for both the city of Detroit and state of Michigan, which reap significant tax revenues from the casinos when they are operating near capacity, he said.

"Michigan has imposed the most onerous capacity limitations of any gaming jurisdiction I am aware of," Calderone said.

Michigan's seven-day average of daily new cases is now in the high 600s, after bottoming out June 15 at 152 and rising to 275 late that month. But state officials said Tuesday case numbers may have reached a plateau, while daily death counts are far below those of March and April and hospitalization rates remain well under control.

Whitmer had hoped to announce that south and central Michigan could join northern Michigan in Phase 5 of her six-phase reopening plan ahead of the July 4 holiday, but that was postponed because of rising cases.