Casino Shareholders Assess Indoor Smoking Policies

By Jane Shaw Senior Editor Updated: 05/22/2024

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We count on Jane to inform our readers about the latest slot games in the US market. With her passion for video games and a degree in engineering, she’s our gambling tech expert. Jane’s also active in our blog section, where she tackles the curiosities and changes in the industry.

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Casino Shareholders

In a new strategy to potentially look at banning indoor smoking at casinos, shareholders at Boyd Gaming, Bally’s Entertainment, and Caesars Entertainment are set to vote on proposals that would require the companies to study the costs associated with allowing smoking inside their properties.

The proposals, sponsored by Trinity Health and the Americans for Nonsmokers’ Rights Foundation, aim, interestingly, to look at financial impacts of allowing indoor smoking. Or, in other words, whether a smoking ban would lead to a significant drop in revenue, and the costs involved with allowing smoking.

Shareholder Activism Takes Priority?

Despite owning only a small fraction of the casino companies’ shares, Trinity Health, a nonprofit healthcare network, has decided to use its shareholder status to begin pushing various health initiatives. The organization owns just 440 shares of Bally’s stock – which represents just 0.001% of the company – but it managed to successfully bring new smoke-free proposals to the attention of shareholders.

The casino companies fought to keep the proposals out of their proxy materials, but the Securities and Exchange Commission denied their requests. As a result, shareholders will have the opportunity to vote on the smoke-free assessments at the upcoming annual meetings: Boyd on Thursday, Bally’s on May 16, and Caesars likely in June.

The three casino companies collectively operate 75 land-based casinos in the USA that currently allow indoor smoking – where state law permits. At the time of writing, 14 US states currently allow indoor smoking inside commercial casinos.

However, new research is emerging that shows smoke-free casinos actually generate more revenue than those that allow smoking. The proposal sponsors argue that shareholders should be aware of the costs associated with permitting indoor smoking, including higher health insurance premiums for employees, increased maintenance costs, and the potential loss of customers who avoid smoky environments.

Mixed Reactions from Casinos and Unions

The casino companies have varying responses to the proposals. Boyd argues that it has seen a negative impact in states that have banned indoor smoking and believes these decisions should be left to individual properties. The company claims that if shareholders succeed in implementing a ban, it will lose customers to competitors who do allow smoking.

Caesars board member Jan Jones Blackhurst stated at a recent online gaming conference that the decision to ban smoking in casinos should be left to governments, citing potential economic impacts such as a 20-25% drop in revenues and job losses. She said:

Generally, if you look across the United States, when casinos prohibit smoking, revenues fall anywhere from 20% to 25%, which also then have a huge layoff factor with people starting to lose their jobs.

Unions have also expressed mixed reactions to the proposals. While some worry about potential job losses, the United Auto Workers, representing more than 10,000 table game dealers across the country, are very much behind a smoking ban – fighting for the health of its employees.

As the vote gets nearer, it’s clear there are mixed reactions to the proposals – and, like many things in life, it’s likely going to come down to the financial implications as to whether or not smoking continues to be permitted in land-based casinos.