Las Vegas Strip casinos get good news on popular vice ban

When a law or rule gets passed in one city, it sets a precedent for the same thing to happen in other jurisdictions. In some cases, when one city or state approves or outlaws something it creates a precedent for other locales to follow.

That can create a sort of wildfire spread effect. In the five years since the Supreme Court allowed states to make their own decision on sports betting, only 11 states have not approved some form of it. 

It was a rapid adoption, in this case, because legislators love the easy money aspect. Legalizing cannabis, a more polarizing decision, has spread in the same way. Once one state legalized recreational marijuana many others followed not because legislators recognized the hypocrisy of legal alcohol consumption while outlawing marijuana, but because they like the tax revenue.

Sometimes, rules that aren't tax drivers can spread quickly. That happened with outlawing smoking at bars and restaurants. It wasn't that long ago when restaurants had smoking sections and bars simply allowed smoking, but that change spread across the nation very quickly.

Those rules left casinos as the only indoor places that largely still allow indoor smoking. Some casinos can make their own decisions on that because their properties sit on sovereign Native American land while casinos in Atlantic City and Las Vegas allow smoking due to specific carve-out exceptions to the laws that outlaw smoking inside other buildings.    

A vote in New Jersey to remove the casino smoking exception will have a major impact on the Las Vegas Strip.

New Jersey legislators vote on Atlantic City casino smoking  

Casino workers, at least union casino workers in Atlantic City, support a smoking ban for what seem to be obvious reasons. United Auto Workers (UAW) represents dealers at three Atlantic City casinos, Caesars Entertainment's (CZR) - Get Free Report Caesars and Tropicana, and Bally's Corps' Bally’s.

UAW President Shawn Fain has an issue with his members facing secondhand smoke.

"Thousands of UAW members…are exposed on a daily basis to the toxic harms of secondhand smoking,” Fain wrote in submitted testimony to state lawmakers, Casino.org reported. “Patrons blow cigarette/tobacco smoke directly into their faces for eight hours, and due to the nature of their work, table dealers are unable to take their eyes away from the table, so they bear through the thick smoke that surrounds their workplace.”

Casino operators, both in Atlantic City and Las Vegas have both argued that smoke free casinos would hurt revenue and cost jobs. In Atlantic City, casino operators have made it clear that they would lose business to casinos in neighboring markets that allow smoking. 

Now, state legislators in New Jersey appear to not have the votes needed to repeal the provisions that exempt casino operators from smoking laws.

Atlantic City keeps smoking (what that means for the Las Vegas Strip)

State Senator Joe Vitale, who sponsored the New Jersey bill, "reportedly lost consensus on the casino smoking proposal after the gaming industry warned that such a regulatory change would put their businesses at a competitive disadvantage with casinos in (nearby Philadelphia) - Get Free Report where casinos can allow indoor tobacco use. The casinos project that a smoking ban down the shore would lead to (thousands of job cuts) - Get Free Report," Casino.org reported.

Atlantic City keeping smoking takes away leverage from Las Vegas unions which would support similar bills limiting, if not outright banning smoking.

Currently, on the Las Vegas Strip only MGM Resorts International's (MGM) - Get Free Report Park MGM bans smoking outright. Many Caesars Entertainment (CZR) - Get Free Report resort casinos have non-smoking sections but the effectiveness of those varies based on their location and proximity to smoking sections. 

The Venetian and its sister property The Palazzo recently began allowing smoking of cigarettes, cigars, and vapes at their table games. Exactly where you can smoke in a casino varies based on each company and each property.

Get exclusive access to portfolio managers’ stock picks and proven investing strategies with Real Money Pro. Get started now.