It’s going to be a long, cold winter — even in the Las Vegas desert.
With COVID-19 cases, hospitalizations, and fatalities trending steeply upward all across the U.S., state and local leaders everywhere in the country are facing hard decisions about whether to close schools, restaurants, and other businesses, not to mention what restrictions to place on travel in and out of their state.
Nevada is no exception. And in that state, “other businesses” points directly to one major economic driver: casinos.
Late Sunday afternoon, Gov. Steve Sisolak announced at a press conference new restrictions that will not close casinos but will further restrict their operations. Capacity at casinos (and all businesses) will be reduced from a maximum of 50% of normal limits to 25%. This puts Nevada casinos on the same footing as those in Atlantic City, which have been at a 25% cap since reopening in July.
Sisolak, who tested positive for COVID-19 himself last week but has reportedly not experienced symptoms to this point, said Nevada has entered a “red zone” with regard to COVID spread. He emphasized that the next three weeks are critical and that more dramatic measures might need to be taken if case numbers don’t begin dropping.
“I am not issuing a shutdown order,” the governor said. “My goal is to aggressively try to attack this spread while maintaining some portion of our economy and our daily life.”
Like many states, NV seeing record case loads
There are plenty of critics who believe Gov. Sisolak has not been aggressive enough, and that he continues not to be with this latest edict.
The number of daily new cases in the state remained under 500 throughout March, April, and May, while casinos and many other businesses were closed, but began to spike in late June and early July, as the effects of Vegas reopening with hardly any restrictions began to be felt. The daily case numbers hit a summer peak of 1,447 on July 16 and came down after mask mandates became stricter and many bars were forced to close. But another spike began in October, and on Nov. 19 a new high of 2,416 new cases in a single day was recorded.
There are currently more than 50,000 known active COVID cases in the state.
Gaming industry consultant Jeff Hwang is among those who feel Sisolak’s latest actions are not strict enough:
Taken altogether, the “STATEWIDE PAUSE” is essentially just reduced capacity limits in casinos, restaurants, bars, and gyms, and designed to avoid taking action for another three weeks. And which will ultimately do nothing to stop our current trajectory. https://t.co/fnJDUvtPyr
— Jeff Hwang (@RivalSchoolX) November 23, 2020
On the flip side, members of Nevada’s Assembly Republican Caucus sent a letter last week to Sisolak, a Democrat, insisting prior to his Sunday announcement that “stricter restrictions will once again lead to declining sales and revenue for local businesses and an increase in unemployment — our state simply cannot afford this.”
It’s a situation in which there is no winning — just levels of losing. According to Howard Stutz of CDC Gaming Reports, gaming revenue on the Strip was down 45% through September, gaming visitation was down 55%, and passenger volume at McCarran International Airport had dropped 56.5%.
A second casino shutdown?
The economic impact has been devastating, and there’s no easy solution to balancing that with the tragic health impact of the virus.
What Nevada politicians and businesspeople alike are hoping to avoid is a second shutdown like the one that lasted 78 days from March to June.
Several operators have taken matters into their own hands with a partial shutdown. At latest count, five properties on the Strip — Palazzo, Encore, Park MGM, Mandalay Bay, and Mirage — have opted to close from Mondays thru Thursdays, apparently having determined the best move for their bottom lines is to welcome only weekend customers.
If Sisolak doesn’t get the results he’s looking for over the coming weeks (Dec. 13 will mark three weeks since Sunday’s virtual press conference), the industry has to brace for the possibility of a full shutdown of casinos.
Actions taken to this point, however, suggest, that’s a last resort for the governor, and he expressed optimism Sunday about the capability of enforcing the new limits.
“I can assure you,” he said, “that the full force of the Nevada Gaming Control Board will be behind the implementation and the enforcement of these 25% requirements.”
Hwang remains skeptical:
Of course, casinos were already “restricted” at 50% on the floor and yet Caesars is reporting 90%+ room occupancy on weekends.
I’ll believe it when I see it enforced for the first time (you know, having been in virtually every open casino in the state of Nevada since reopening). https://t.co/2XLrWYmoTm
— Jeff Hwang (@RivalSchoolX) November 23, 2020
Photo by James Mattil / Shutterstock.com