Casino companies ask US Congress for emergency financial aid

Casinos have joined the airline industry in asking US Congress for emergency financial help as Las Vegas and other tourist destinations take a severe financial hit from the coronavirus outbreak.

The requested aid for the casino companies, raised by lobbyists in recent days, could come in the form of a comprehensive bailout package, similar to what lawmakers may provide to airlines, cruise companies and the hospitality industry. Other possibilities include direct cash payments, deferred taxes or special bankruptcy protections, The Washington Post reports, citing two people with knowledge of the conversations who were not authorized to speak publicly.

One person said that on a strategy call Monday with members of the American Gaming Association (AGA), which represents the industry, a representative of Wynn Resorts raised the possibility of the industry seeking cash payments. Wynn was previously run by one of President Trump’s biggest political donors, Steve Wynn, who resigned his post in 2018. 

The AGA issued a statement to The Washington Post on Monday, saying that with the $260 billion industry at a “near standstill,” additional funds are needed to support casino companies and their employees. “As state governments close casinos as a part of the urgent public health response to COVID-19, elected leaders should move just as urgently to support the workers and businesses who will bear the brunt of those effects,” the AGA said. “Our immediate priorities are actions that provide liquidity to allow us to support employees.”

The casino industry has been battered by shutdowns related to the coronavirus, with an increasing number of states demanding that all casinos, restaurants and bars close immediately to minimize person-to-person contact and reduce crowds.

Casinos in Atlantic City and in Maryland have been shut down. Wynn Resorts announced it would close its Wynn Las Vegas and Encore properties, while MGM Resorts International said it would close all Las Vegas casino operations Monday, followed by closing the hotels Tuesday. Some casinos in Las Vegas and across the country continue to operate despite recommendations from the Centers for Disease Control and Prevention that people reduce in-person contact and that events of 50 or more people be canceled.

The Trump administration has already moved to help the oil and gas industry by announcing plans to buy oil for the Strategic Petroleum Reserve to buttress companies hit by a downturn in energy prices. Trump administration officials have also said the administration will push for special financial relief for the airline, cruise and hospitality industries, which have also been hit hard by the coronavirus.

A bipartisan package approved Friday by the House and supported by Trump did not include bailouts for these companies, but assistance for specific industries, particularly the airlines, is expected in a third congressional package. Lawmakers have started to work on that third package this week, according to multiple congressional aides involved in deliberations, as the Senate takes up the legislation approved by the House.

The gambling industry supports 1.8 million jobs, according to the AGA, which could argue that thousands of low-wage workers will suffer if the companies are not bolstered by the federal government. But extending financial aid to casinos may provoke more political opposition than efforts to support airlines or other travel industries, particularly as federal lawmakers face scrutiny over whether they are picking winners and losers in an economy broadly affected by the pandemic.

Trump administration officials have sought to compare their efforts to the targeted help offered to the airline industry when business was hammered after the 9/11 terrorist attacks. Treasury Secretary Steven Mnuchin, testifying to lawmakers earlier this month, denied the financial assistance being considered amounted to a “bailout.” Among the ideas floated include deferring federal taxes for certain industries and providing zero- or low-interest loans to certain companies. “This is not a bailout,” Mnuchin told lawmakers. “This is considering providing certain things for certain industries.”