ATLANTIC CITY — Billionaire Glenn Straub, who bought the former Revel casino hotel out of bankruptcy, lost his bid Tuesday to be exempt from getting a New Jersey casino license.
The Casino Control Commission ruled that Straub is required to be licensed to reopen the Revel as a casino, even though he intends to lease operations to another company.
"We would turn the Casino Control Act on its head if we permitted this applicant to avoid licensure," said Matthew Levinson, chairman of the commission. He said he would move to schedule a licensing hearing for Straub.
But Straub said after the meeting that he would pursue the issue in court. He said he does not want to subject his company to regulations imposed by the state board. He said the ruling was "just one government agency backing another government agency."
"These people just rubber-stamp what the state agencies do," he said.
Straub, who bought the former $2 billion casino hotel out of bankruptcy in 2015 for $82 million, argues that because he is leasing the gaming operations to a group of business people calling their enterprise TEN, he personally does not need to be licensed.
Robert Landino, head of TEN, attended the hearing but declined to comment. Landino and other executives have filed for a certificate of compliance for casino operations, but they do not currently hold a license either.
Straub said he would reopen the property as a hotel Feb. 20 with or without a license, but there has been no other indication that an opening is imminent.
Indeed, the head of the Division of Gaming Enforcement went a step further Tuesday and questioned the ability of the property to reopen any time soon. He noted that the TEN operators had not submitted a completed application to be licensed themselves.
"The opening of this facility for casino operations is not even remotely imminent at this time," director David Rebuck said.
"This has been an arduous process," said Straub attorney Lloyd Levenson, beginning his argument Tuesday morning before the three-member board. He argued that Straub would not have significant control over his casino hotel according to the terms of the lease with his operators.
"In sum, from the time a patron of TEN drives up to the building, parks in valet or self parks, checks in at the front desk, goes to his or her room, grabs a bite to eat, gambles, maybe buys some forgotten toiletries and goes to sleep, the patron is having an experience provided by the tenant," Levenson said.
Levenson urged the commission to make it possible for Revel/TEN to open, not to keep it from opening.
"We have to think about what's happening in Atlantic City in 2017," Levenson said. "We can't look back to the glory days of Atlantic City. We have to think a little bit out of the box, not to violate the statute but to think, how can we make this work? Not how can we make it not work."
Levinson, the casino board chair, said: "I recognize the social and economic benefits that reopening a casino hotel would have. I want to see this property reopen and see thousands of my neighbors put back to work. But the environment in Atlantic City does not change the requirements of the Casino Control Act."
Mary Jo Flaherty, a deputy attorney general representing the Division of Gaming Enforcement, which has been tangling with Straub since 2015, responded: "This can work. This can all happen. All that has to happen is licensure. "