NY FOCUS: Half-Billion Dollar Casino Rescue Plan Hinges on Boom. Analysts Predict Bust

This story originally appeared in New York Focus, a nonprofit news publication investigating power in New York. Sign up for their newsletter here.

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NEW YORK STATE · September 25, 2025

Sullivan County is telling investors there will be massive growth at a Catskills casino resort, but its own consultants predict decline.

By Chris Bragg , New York Focus

Sullivan County is asking investors to ​lend ​more than half a billion dollars​ to rescue the struggling Resorts World Catskills​, touting rosy predictions that the casino resort will soon be flooded with visitors and make dramatically more money — even though its own consultants predict the opposite.

Here’s the county’s pitch. Investors would buy up to $585 million in bonds from the county’s newly-formed local development corporation, spun out of its Industrial Development Agency, or IDA. The corporation would buy two hotels, a golf course, and an event venue — almost everything except the casino itself — from the current owner, Empire Resorts, Inc. The cash infusion could enable Empire Resorts to invest in the property and to pay off $300 million in debt due next year, helping it stave off possible bankruptcy.

The non-casino properties, the development corporation assures investors, will soon become a cash cow. Because the parent company of Empire Resorts is a heavy favorite to win a casino license in Queens, the corporation reasons, Empire Resorts will soon have a database with a million new table game customers. It will be able to entice some of them to travel to the Catskills, with its lower gaming tax rates, and to stay in the resort there. By 2029, hotel room occupancy will increase nearly 16 percent, non-gaming revenue will climb a whopping 80 percent, and the investors will make a tidy profit.

The problem? Two studies prepared for the county came to very different conclusions.

Local and county officials have long predicted that three new downstate casinos will draw customers away from Resorts World Catskill, as New York Focus reported in 2023, and analysts have agreed.

The consulting firm Cushman & Wakefield prepared an appraisal of the non-gaming assets which forecasted that the Catskills hotel occupancy will drop to 60 percent by 2029, rather than rising to the 86.5 percent predicted in the bond pitch. (The Cushman & Wakefield analysis is attached to the investor pitch, which does not explain the contradictory findings. Cushman & Wakefield was retained by the firm the development corporation picked to underwrite the bond offering.)

Another firm, Capacity Consulting, prepared a separate analysis for the county finding downstate casinos could cause Resorts World Catskills revenue to plummet up to 76 percent and negatively impact tax revenues from related businesses — such as the resort’s hotels. Yet the investor pitch predicted an 80 percent revenue increase for those businesses by 2029.

The IDA’s executive director, Jennifer Flad, declined to explain these discrepancies.

“I am not in a position to respond to some of your questions,” she wrote.

So what happens if the corporation can’t pay investors back?

The proposed bond offering stipulates that taxpayers aren’t on the hook for investor losses. Matt McPhillips, the chair of the Sullivan County Legislature’s economic development committee, told Radio Catskill that taxpayers “have no stake in this deal.”

“There’s no collateral that the county or its taxpayers are responsible for,” McPhillips said. “This is more to allow the casino to reconsolidate, reposition itself, and really invest in this property.”

But at the request of interested buyers, the local development corporation recently brought in lawyers to analyze ways to protect investors in the case of default.

A default could create political pressure for the state or county to intervene. Resorts World Casino plays a major role in the local economy and employs over a thousand people, its developers received more than $50 million in local tax breaks, and it regularly asks Albany for deeper subsidies.

A default could also harm the county’s reputation and increase its future borrowing costs, according to David Brittenham, a Sullivan County resident and retired partner at a major law firm whose practice focused on corporate financing deals.

“A default could potentially be taken into account by credit agencies in evaluating the county itself — and its borrowing capacity,” Brittenham said. “It’s at least going to be a black eye.”

It’s not clear whether Sullivan County consulted independent bond ratings agencies, such as Fitch, Moody’s, or Standard & Poor’s, about the implications of a default for the county. No rating agency has given the investment opportunity a formal grade.

Brittenham said allowing Empire Resorts to go into bankruptcy could have been a better path for Sullivan County — and wouldn’t necessarily have involved layoffs.

“It’s not clear to me they got expert investment banking advice about their options,” he said. “Bankruptcy, to me, should have been evaluated seriously, because under our bankruptcy law, the idea is to rehabilitate the business, not simply to wind it up. And there are plenty of companies that go through bankruptcy, sometimes more than once, with little or no loss of jobs.”

The county was shaken by the shuttering of a Frito-Lay plant in Liberty this spring that cost nearly 300 jobs.

It’s not clear whether Resorts World threatened layoffs, prompting the county’s $585 million venture. A company spokesperson did not respond to questions. The undertaking has played out almost entirely behind closed doors; McPhillips, the county legislator, did not respond to questions either.

The bailout isn’t yet a done deal, and the formal bond offering continues to face delays.