Carl Icahn Says He Will Not Invest $100 Million in Taj Mahal, If North Jersey Casinos Are Built

Last updated on November 2nd, 2018

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Carl Icahn, the new owner of the Trump Taj Mahal, said he might not invest the planned $100 million in the Atlantic City casino, if the New Jersey legislature chooses to build a North Jersey casino. Previously, Carl Icahn had indicated he would renovate the bankrupt Atlantic City casino.

Mr. Icahn said he might not make the investment, because he believes New Jersey politicians broke promises they made to him regarding casino expansion in the state.

He said politicians promised to protect Atlantic City against competition, but those same politicians now want to undermine AC by building gaming palaces elsewhere. Icahn attributed political ambition to the decision.

Icahn Blames Political Leaders

In a press release, Icahn said, “Unfortunately it appears that certain political leaders are lining up against Atlantic City because of their personal ambitions. They are for gaming in North Jersey, which as everyone knows would destroy thousands of jobs in Atlantic City and South Jersey.”

The politicians Carl Icahn seems to reference are State Senate President Stephen Sweeney and State Sen. Ray Lesniak, who are each considering a run for governor on the Democratic ticket. Both have been wholeheartedly in support of a North Jersey casino plan, which would place 2 casinos near New York City.

The plan is to draw customers from NYC, while also retaining North Jersey gamblers who might choose gaming establishments near Philadelphia, in Upstate New York, or in Eastern Connecticut, instead.

Gov. Chris Christie

Another one of the politicians Carl Icahn seemed to reference is Gov. Chris Christie. Christie has supported Atlantic City through the years, even setting a 5-year moratorium on building casinos outside Atlantic City. That moratorium was announced in February 2011 and is set to expire this month, meaning Christie kept his promise.

The departing governor is an easy target, though. Gov. Christie faces term limits which requires him to leave office in 2017, when his second term is up. Christie recently ended his campaign to become the Republican Party’s nominee for US president in 2016.

He quickly endorsed Donald Trump, who once owned 3 casinos in Atlantic City. Many see Christie’s endorsement as a decision based on political calculation, as he likely hopes to have a high profile position in a Trump White House, either as vice president or attorney general.

Says He Wants to Save Atlantic City Jobs

Carl Icahn said in a phone interview from his home in Far Rockaway, New York, that he is not swayed by promises that Atlantic City casino license holders are likely to benefit from the North Jersey casino plan. He said his point is not to make money (which he could do with the North Jersey plan), but to keep jobs in Atlantic City.

He told Kaja Whitehouse of USA Today, “Even though I could benefit more from a license in North Jersey, I would much rather see Atlantic City continue to blossom, especially since I have been, in my opinion, an important part of it.”

Tropicana Casino Turnaround

Carl Icahn currently owns the Tropicana Casino and the Trump Taj Mahal in Atlantic City. He bought the Tropicana out of bankruptcy in 2010, and led a 5-year turnaround which won a great deal of praise.

Many expected him to do the same with the Trump Taj Mahal. In fact, Donald and Ivanka Trump gave their blessing to Icahn’s leadership, saying he is a family friend and a great businessman. The two sides agreed on keep the “Trump” name on the casino.

More Bad News for Atlantic City

Yet now, it appears as if the long-awaited renovation might not happen at all. It is the latest bit of bad news for Atlantic City’s gambling industry, as well as its economy as a whole. The city’s gaming revenues have declined from $5.4 billion in 2006 to an estimated $2.3 billion in 2015. The city lost 9,000 jobs in 2014, including 8,000 in the gaming sector.

Even if the North Jersey casino plan allows for revenues to go to Atlantic City’s casino companies, that does nothing to alleviate the economic downturn for the thousands of casino workers who almost certainly would lose their jobs. The earlier cuts have forced the Boardwalk city into near-bankruptcy. New Jersey Governor Chris Christie recently announced a 5-year takeover of the AC economy by state officials, who will set a budget and trim the payroll.