The federal government recently formed and passed a $2 trillion relief package to aid companies suffering during the coronavirus pandemic. A major part of this package included funds to help small businesses hurt by the pandemic, but it does little to aid casinos that are forced to shut down to stop the spread. The American Gaming Association (AGA) is hoping to get the bill changed to help casinos find a way to get through the crisis.
AGA President and Chief Executive Officer Bill Miller is hoping that the United States Small Business Administration takes another look at their policy when it comes to helping small casino companies. The Small Business Administration established a Paycheck Protection Program (PPP), but Miller claims that it does very little for small gambling operations in the United States.
The money promised to companies from this program will help pay employees during the time that casinos are forced to keep their doors shut according to state and local rules and regulations.
One of the biggest problems of the Paycheck Protection Program is that it eliminates all small casinos from being eligible. Any company that generates more than one-third of its annual revenue from legal gambling is not eligible to receive any money from the program.
While this only technically wipes out over 30 percent of casinos from receiving relief funds, it will cost a large number of people their paychecks.
Any company that is eligible under these guidelines can apply to receive up to $10 million from the PPP. Another rule is that companies must employ less than 500 people on a full-time basis, which will also rule out larger casino companies.
The American Gaming Association is hoping that the laws can either be amended or that a new program can be created to help out all of the casinos in the gambling industry.
Support For Plea
AGA President Miller has plenty of support in his plea to the SBA, most notably from South Dakota. Senator Mike Rounds (Republican) recently penned a letter to the SBA, telling them that these current restrictions would be crippling to the economy in South Dakota.
Rounds cited casinos in Deadwood that employ more than 1,000 people, and are currently ineligible to receive any funds. Rounds claims that without help from the federal government, these casinos would be forced to close, which would cost countless people jobs and would ruin the economy in the state.
There are currently 989 tribal or commercial casinos located in the United States, and all but two were closed as of April 5. Most casinos were forced to shut down around St. Patrick’s Day, but casinos in South Dakota remained open until the end of last week. Currently, all commercial and tribal casinos are closed in the state.
Another major problem with the Paycheck Protection Program is that it is done on a first-come, first-served basis. The PPP was a $349 billion initiative, but those funds are expected to run out extremely fast.
If casinos are not able to apply for these funds, then there is a chance that there won’t be any money if the rules are eventually amended.
Some of the largest casino companies in the United States have agreed to pay their employees through the duration of the shutdown, but smaller companies will not be able to carry that financial burden.
The American Gaming Association is hoping to get these rules amended early this week to save businesses in their industry. The federal government is also reportedly working on a new program to provide extra financial relief.