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ACH, the casino formerly known as the Atlantic City Hilton, appears to be on the shakiest ground. In November, state regulators approved a plan for the casino to stay open with a fresh infusion of capital from its owners, Los Angeles hedge fund Colony Capital LLC, and a cancellation of its debt. But the casino has committed to staying open only through the end of October, and it's going after the smallest of small fish in a market that prizes whales. It recently got permission to use table game gambling chips worth as little as 25 cents -- the first time Atlantic City has let any casino use a chip worth less than $1. Resorts Casino Hotel also has yet to turn a profit in the first year of new ownership, although it expects to at least break even by the end of 2012. Atlantic City's casino revenue peaked in 2006 at $5.2 billion; it has since fallen to $3.6 billion at the end of 2010, mostly due to casinos opening in neighboring Pennsylvania and New York, and the poor economy. Many expect revenues for 2011 to be in the range of $3.2 billion. Atlantic City desperately needs new money, Pollock says. "The spigot had been turned off on new capital investment and it's crucial that that spigot get turned back on again," he said. "Atlantic City was on its way toward reinventing itself with a new business model" when the bottom fell out of the economy. The Seminole Indians, through their Hard Rock franchise, say they are ready to do just that. They plan to break ground by July 15 on Atlantic City's first so-called "boutique casino," a smaller, less expensive gambling hall authorized under a pilot program to jump-start the stagnant casino market here. The first phase of the project, with 208 hotel rooms. will cost about $465 million, and eventually grow to 850 rooms. New Jersey's state government adopted a number of reforms for Atlantic City in 2011 that will have the chance to bear fruit in 2012. It beefed up the Casino Reinvestment Development Authority and put it in charge of revitalizing the resort, including making sure its streets are clean and safe. But the reform likely to have the most immediate impact is the formation of the Atlantic City Alliance, a private casino-financed nonprofit corporation that will spend $30 million a year for the next five years to promote Atlantic City to the rest of the world. That's money the casinos were required to pony up to the state's racetracks in return for keeping slot machines out of racetracks, until Christie intervened and killed the arrangement, much to the delight of the casinos. "What did Revel do in its first year, and what did we do with the $30 million we suddenly had at our disposal to market Atlantic City?" said Rodio, the Tropicana president. "That's what we'll be debating next New Year's Eve."
[Associated
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