Trump Taj Mahal in Atlantic City blames worker strike for closure

The Trump Taj Mahal casino in Atlantic City will close after Labor Day weekend, in part because of a workers' strike, its owner said Wednesday.

"Currently the Taj is losing multimillions a month, and now with this strike, we see no path to profitability," Tony Rodio, head of Taj Mahal manager Tropicana Entertainment Inc., said in a statement.

About 1,000 workers have been striking since July 1 after negotiations fell apart over health and pension benefits.

"How petty. I would never have thought Carl Icahn was so one-dimensional," Bob McDevitt, president of striking Unite Here Local 54, said in a statement. "The great deal-maker would rather burn the Trump Taj Mahal down just so he can control the ashes."

Local 54 members include bellhops, cooks, and housekeepers. About 3,000 workers would lose their jobs in the closure.

Mayor Don Guardian said in a statement that his "thoughts and prayers" were with the workers facing layoff.

"It's unfortunate and disappointing that no resolution was found to keep the Taj Mahal open with the hopes of making it profitable again," Guardian said in the statement.

Near the casino hotel Wednesday, striking workers yelled "No contract, no peace," and union members said they would continue the strike for the foreseeable future.

"We're not going to stop now … that wouldn't benefit anyone," said Vince Scotti of Margate, N.J., who tends bar twice a week at the casino and has been a union member for 33 years.

"There's no shock here. We'd hoped they'd have a little compassion, a little honor, and give us a fair contract, but no," he said.

Four casinos — Showboat, Atlantic Club, Revel, and Trump Plaza — closed in 2014, victims of increased gambling competition on the East Coast and leading to an estimated 8,000 lost jobs. The Taj Mahal closure will leave seven casinos in the resort town, which has long depended on gambling as its lifeblood.

Assemblyman Vince Mazzeo (D., Atlantic) criticized the closure announcement as "an act of corporate Wall Street greed."

Opened by Donald Trump in 1990, the Taj Mahal was teetering on the verge of closure in 2014 when Trump Entertainment Resorts, its owner, filed for bankruptcy.

Activist investor Icahn took control of the company in bankruptcy — spending about $86 million to keep the Taj open — and Trump Entertainment Resorts emerged from bankruptcy in February.

The Taj is run by the same managers as the Icahn-owned Tropicana. The casino kept Trump's name but is no longer owned or controlled by him.

Analysts have long questioned the industry's financial footing, predicting additional casino closures in the competitive market.

The Taj Mahal has been in particularly rough financial waters. Of the eight casinos, the Taj was the only one to report a loss in the first three months of this year, according to the most recent state data available.

The Taj also struggled to fill its hotel rooms in the first quarter. It reported a 49 percent occupancy rate to the state, the lowest of the eight casino hotels; the average was 74 percent.

Rummy Pandit, executive director of the Lloyd D. Levenson Institute of Gaming, Hospitality, and Tourism at Stockton University, said he hoped the Taj's gambling business and hotel reservations would spread to the remaining seven casinos. That would make for minimal impact on overall revenues, he said.

Still, Pandit said, the closure would be a blow to the local economy.

"It's unfortunate for all concerned," he said. "For the operators, for the employees, and, of course, for the guests — especially the repeat customers who've grown used to coming to that property and being recognized and welcomed. So it's not a good thing for the market."

Robert Stells of Long Island said he had continued to gamble at the Taj because he had developed "a great rapport" with some of the employees.

"This place has seemed like it was hanging on by a thread for a long time," said Stells, who plans to visit the city's other casinos. "It's gotten a little stale here in the past few years."

While Atlantic City has sought to diversify its economy, including the planned creation of a Stockton campus, gambling remains a financial cornerstone.

That may soon dissolve even faster, with a question on the ballot in November asking voters to approve casino gaming to North Jersey.

The city is also scrambling to stave off a state takeover. Under a law signed in May, the city has until the end of October to submit a sufficient financial plan that includes a balanced budget for calendar year 2017 and a five-year plan to stabilize its finances.

In the meantime, the state is providing tens of millions of dollars in aid, keeping the city afloat while giving it time to put together its plan to stave off state intervention.

Peter Battaglini, 60, a hotel bellman who has worked at the Taj from its first day of business 26 years ago, said he was shocked when he heard it would close.

"It's that Wall Street mentality — suck all the money you can out of a business and leave it in ruins," Battaglini said. "This really is going to leave a lot of people in a very bad situation."

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Staff writers Amy S. Rosenberg and Harold Brubaker contributed to this article.