ATLANTIC CITY - The controversial bill to allow up to four smaller casino hotels with as few as 200 rooms in this seaside gambling mecca goes before the state Senate's Government, Wagering and Tourism Committee in Trenton on Thursday.

While it's been several weeks since State Sen. James Whelan (D., Atlantic) announced his bill, the uproar over it hasn't died down.

Operators of existing Atlantic City casinos remain divided on how much new investment can be generated. Some are opposed to what they describe as giving an unfair advantage to new developers by allowing them to invest a fraction of what it cost to build the existing casino hotels.

Don Marrandino, Eastern Division president for Harrah's Entertainment Inc., which owns four casinos in Atlantic City, was taking a neutral position.

"We would be open if the developer [of a smaller casino hotel] added world-class amenities that would further stimulate tourism," he said Tuesday.

The bill is the first proposed change to the requirement of at least 500 hotel rooms that was part of the 1977 Casino Control Act, which legalized gambling in Atlantic City.

An Assembly version was introduced last Thursday by Assemblyman John Burzichelli (D., Gloucester) and referred to the Regulatory Oversight and Gaming Committee.

The bill has already spurred interest from at least one developer - Och-Ziff Real Estate - which announced in March, one day after Whelan said he was sponsoring the lower-room-threshold bill, that it had struck a deal to build a $300 million Hard Rock Casino Hotel next to the Atlantic City Hilton.

"I think we'll have bipartisan support," Whelan, a former Atlantic City mayor, said Tuesday. "Hopefully, it moves forward.

"With Atlantic City, we have experienced a couple of tough years, and we're not seeing a lot of new investment and reinvestment in this market," he said. "Frankly, Philadelphia and Pennsylvania [casinos] have a lot to do with that.

"Hopefully, by lowering the threshold of what it costs to enter the Atlantic City market, we can accomplish two things: create new product, and . . . fill in some of the blighted and vacant ground, some of which has been along the Boardwalk for the last 30 years."

But Mark Juliano, chief executive officer of Trump Entertainment Resorts Inc., which owns the Trump Taj Mahal, Trump Marina, and Trump Plaza casino hotels, calls the bill "a terrible idea."

"We all played by these rules for a long time," he said. "To change the rules now when we're really hurting is not fair, and it's not right."

Allowing smaller boutique hotel casinos is one of a handful of gaming reforms being touted in Trenton. Each calls for changing the Casino Control Act to aid Atlantic City as it struggles against the new gambling competition.

Other New Jersey lawmakers are also pushing to allow sports betting at casinos and for installing slot machines at racetracks.

Four of the nine operating casinos in Pennsylvania have announced plans to add hotels with at least 300 rooms - similar in size to what Whelan's bill envisions. Sands Casino Resort in Bethlehem breaks ground on a $50 million, 300-room hotel this month.

Whelan said because there was no minimum room threshold in Pennsylvania, "you can get into Pennsylvania for a fifth of what you need to get into New Jersey. So why spend a billion dollars here when you can go there and spend $250 million?"

Under his bill, developers could also build a casino in phases of not more than 30,000 square feet and not less than 200 rooms, with the requirement that they expand to the 500-room requirement within five years of licensure.

"We have opened one new casino in 20 years [the Borgata in July 2003], and that's not acceptable when you're in the tourism business," he said.