The gambling industry's role in post-Katrina recovery

The Treasure Chest Casino was one of the few riverboat casinos that survived Katrina's initial impact. Treasure Chest Casino

NEW ORLEANS -- Captain Dean Naquin knew it was time to go. Only a handful of the crew was still on board the Treasure Chest, and they needed to get the money off the casino boat.

On Sunday, Aug. 28, 2005, Hurricane Katrina was just hours away, bearing down on Lake Pontchartrain, where the Treasure Chest was docked. For the first time in his life, Naquin was preparing to abandon ship. The corporate office had called that morning to let the crew know they needed to evacuate. Naquin looked at the radar, saw the hurricane taking up the entire Gulf of Mexico and agreed: It was really time to go.

Around noon, Naquin called the crew together and stressed the reality of the situation.

"Remember," he said, "if there's no boat when we get back, there's no job when we get back."

They battened down the hatches like never before. The barge was tied to the shore with wire hurricane cables as thick as a fist, and parts of the boat were powered down to eliminate the normal ding-ding-ding-dings of the slot machines, leaving a strange silence. The ship's doors were locked and braced, some with two-by-fours.

Then, it was time to get the money.

Naquin says he doesn't know the amount they unloaded off the boat and drove out of frantic New Orleans that day, but judging by Louisiana Gaming Control requirements, it was likely millions.

"Let's just say, we got it all off, and it was all safe and sound," Naquin said in a recent interview, nearly 10 years after Hurricane Katrina. "I'm sure the director of finance knew down to the penny what we had, but it was just paper to us."

Normally a four-hour trip, it took Naquin's caravan 12 hours to get to the Treasure Chest's Boyd Gaming sister property: Delta Downs in Vinton, Louisiana.

Katrina was a Category 3 hurricane, with sustained winds of 125 mph when it came ashore on Monday, Aug. 29, 2005, in Southeast Louisiana. Along the Mississippi Gulf Coast, several casino barges broke off their moorings and were pushed ashore, even across highways. Waking up at daylight Tuesday after the storm, Naquin had no idea whether his boat still existed.

He returned to the scene by helicopter later Tuesday, landing in the field in front of the boat. Big, heavy boulders that normally line the banks had been picked up by storm waves and deposited in the parking lot. All the flags, awnings and signs on the outside were completely destroyed. The cables and moorings had been tested, but the boat was still there. It would become their home for the next month.

The first night, the skeleton crew of roughly four slept by lying across three or four chairs in front of slot machines. They had a buffet's worth of thawing food, plenty of booze and a generator for a little light. (They would eventually empty the cigarette machines and barter for fuel.) But outside of the boat, on the horizon normally illuminated by downtown New Orleans, there was nothing.

"It was total darkness surrounding you, dark like you've never seen before," Naquin recalled. "Absolutely nothing."

Gambling is in New Orleans' blood.

The tasty Cajun cuisine and brass music that pops up on the corners play bigger roles in the city, but peel back the curtain a little, and you'll see there's plenty of gambling going on in the Big Easy.

Harrah's, located just outside of the French Quarter on Poydras Street, and two riverboats in the suburbs -- Boomtown and Treasure Chest -- are the primary New Orleans casinos. The historic Fair Grounds has been home to horse racing for more than a century, overcoming a massive fire in 1993 and Katrina in 2005. Video poker machines that generate millions in revenue can be found practically anywhere there's a barstool. Pools relating to anything from Saints games to baby births hang on the walls at most watering holes. It's all out in the open, but there's also plenty of behind-the-scenes action.

It takes about a pint of Abita Amber and a conversation to find a private poker game or a local bookmaker. After the storm, with Harrah's closed for months, there was an uptick in home games, local gamblers say. The city has always been rich with local bookies willing to take the action and pray the Saints and Tigers don't cover. Money games at golf courses and pool halls are routine.

New Orleans loves its food, its music and its Saints. And it loves to gamble.

In the 10 years after Hurricane Katrina struck the Gulf Coast, gambling was an unquestionably important economic catalyst during the recovery. Despite a reduced population, the four fiscal years following Katrina's arrival (2005-06 through 2008-09) were the biggest years of Louisiana's gaming history, according to the Louisiana Gaming Control Board. One year before the storm, in October 2004, video poker generated $47.58 million in revenue; in October 2005, the earliest the bulk of storm evacuees began returning, video poker revenue was $59.07 million.

People gambled, allowing casinos to get employees back to work and giving a boost to the entire Gulf Coast region. A 2014 study by Oxford Economics found that the gaming industry contributes more than $4 billion to Mississippi's economy, supports approximately 37,000 jobs and nearly $1.5 billion in income.

As gambling increased after Katrina, so did calls to a national problem gambling hotline from Louisiana and Mississippi. According to the National Council on Problem Gambling, 7,020 calls from Louisiana were made to the helpline in 2004. The calls climbed all the way to 8,793 in 2008. There was a similar trend in Mississippi.

"Anytime there's a natural disaster, people are going to experience PTSD [post-traumatic stress disorder]. They feel terrible, and they want to feel better," said Deborah Smith, a nationally certified gambling addiction specialist at Sunspire Health Recovery Road. "Gambling actually helps them feel better for the moment. Then, the consequences kick in. There is a lot of connection with PTSD and problem gamblers."

The calls to the gambling helpline eventually leveled off around four years after Katrina, as life slowly drifted toward a new normalcy in the impacted areas.

There were 12 Mississippi Gulf Coast casinos at the time of Katrina; in December later this year, when the Scarlet Pearl is scheduled to open, there will be 13.

'Seeing that flag just got everybody all stirred up'

In Biloxi and along the Mississippi Gulf Coast, money and casino chips could be spotted lying on the ground in the days after the storm.

At the beachfront Beau Rivage Resort & Casino, Katrina piled up slot machines and craps tables in one area and left sticky, stinky sludge everywhere. The walls on the entire first floor were designed to blow out in the face of hurricane winds, and they did. After the storm, you could stand in front of the fountain at the entrance of the hotel, look straight through what used to be the hotel lobby, restaurants and gaming areas, and instead look out to the Mississippi Sound, which flows into the Gulf of Mexico. The storm surge that created that view flowed through the bottom two floors of the casino and was estimated to be 34 feet high.

Most of the money had been evacuated by armored trucks in advance of the storm, but there was still some in the slot machines. Workers dug through the muck to retrieve the bill elevators out of the slots and transport it off-site to be cleaned and disinfected. A team of 40, wearing full Hazmat suits, spent a month cleaning, scrubbing and sorting every coin and bill.

On higher floors of the 1,740-room hotel, everything looked fine. But further tests showed the sideways-blowing rain from the storm had penetrated the walls and gotten into the insulation and sheetrock. Every hotel room had to be stripped down to the steel studs to rebuild.

It was worse for other casinos. Beau Rivage was one of the only barges that stayed put during Katrina. Harrah's Grand Casino riverboat separated from its moorings and ended up across the street, a block away from its normal home. (Casino riverboats, loaded down with slot machines, fuel and other equipment, can weigh more than 2,500 long tons, or 5.5 million pounds.)

"Some of the [casino] barges were tossed around like Tinkertoys," Beau Rivage communications director Mary Cracchiolo Spain said.

Eric Newton, director of security for Beau Rivage, evacuated in advance and returned the day after Katrina hit. While he was trudging around the foot-high sludge in rubber shrimp boots, a woman approached him, holding hands with her two young children. She had tears in her eyes and said: "I work here. I work in housekeeping. My house has been destroyed. What we are wearing right now is all I have left. Do I have a job?"

The answer was yes. He took them across the street, gave them food and water and helped them connect with relatives that lived up north.

"That was tough, really tugged at my heart," Newton said. "We were feeding them good at the time, we had all these Kobe beef steaks out of the freezer, and we had a grill."

Just 48 hours after the storm, MGM declared it would rebuild Beau Rivage. Along with MGM, Boyd Gaming and Pinnacle were among the companies that guaranteed employees their jobs and months of pay after Katrina. Some dealers were given jobs in Las Vegas. Local employees were turned into Red Cross case workers to add to their income. Soon, thanks to the friends in Las Vegas, they had a flag, too.

"The first thing we needed was fuel," Newton recalled. "And then we needed the biggest American flag that they could send us. Our flags were torn up and gone. And my guys wanted to put a big, ol' American flag right out in front of the building. And that's what they sent us, fuel and a flag. Seeing that flag just got everybody all stirred up and going: 'Let's rebuild. Let's go.'"

On Aug. 29, 2006, exactly one year after Katrina, Beau Rivage, the second-largest employer in Biloxi, reopened.

'You sort of felt like, the world ain't ended.'

Boomtown Casino, located 25 minutes outside of downtown New Orleans on the Harvey Canal, was the first casino to reopen after Katrina on the Gulf Coast. On Sept. 30, just one month after the storm, hundreds of people filled the entryway onto the boat, shoulder to shoulder, waiting for the scheduled 1 p.m. opening. To appease the eager crowd, Charlie Frederick, Boomtown's do-everything director, opened an hour early.

Frederick recalls standing at the top of the entryway, peering down on the eager crowd. Some were hungry; others were just looking for anything to get their minds off of their post-storm reality.

"It was such a bad time," said Charlie Thomas, a loyal Boomtown customer of 20-plus-years who was among the droves of people that came to the reopening. "It was sort of nice when it re-opened. You sort of felt like, the world ain't ended."

Doretha Simpson, another veteran Boomtowner who sat next to Thomas on a row of slots this August, nodded her head in agreement, noting that she didn't frequent the casino after the storm to win tons of money.

"It was more about fun," Simpson said.

One week before the 10-year anniversary of Katrina, Frederick stood above the same entryway and thought back to the morning Boomtown reopened. He swears he didn't let a smile slip out from under his bushy, gray mustache that day, even though he'd been working day and night for a month in preparation for that exact moment.

"I knew it was going to be a lot more work," he scoffed, in his grumpy-but-loving Cajun grandpa way.

In preparation for the reopening, Boomtown employees who were in town and able worked for 30 days straight around the clock. Some were paid triple-time. Some slept in the casino, turning the rows of slots into tents with sheets over the top of the machines. There was a makeshift shower installed in the employee break room. They cleaned the parking lot, which was cluttered with debris, mopped the floors and sanitized everything. Nothing compared to the food, though.

"Boy, the food ... that was the worst part," Frederick said adamantly. "Put it this way, it made a rotten egg smell like a rose. There was this one wok, I remember, that didn't get washed out. They just left it. It was my favorite."

Business boomed, though, and it was all that the slender, makeshift crew could handle. There were no tickets for the slot machines, so everything was paid manually. The crew constantly was going from slot to slot, paying jackpots in cash and filling machines with coins. One day, Frederick ran a financial tracking report and found guests from 27 states were on the boat.

For nearly two weeks, until the Treasure Chest reopened on Oct. 10, Boomtown was the only game in town for practically the entire Gulf Coast.

'That first Thanksgiving back was really a reunion'

Dating back to the Civil War, horse racing in New Orleans has always been a survivor.

Union soldiers, occupying the city in the early 1860s, confiscated the majority of race horses. But according to historical accounts, racing remained as popular as ever. In 1941, the track was on the verge of closing and was saved by a last-minute auction purchase from a group of New Orleans businessmen. On Dec. 17, 1993, a seven-alarm fire incinerated the grandstand. It was so hot that the cement steps leading up to the clubhouse glowed red. People watched the blaze on TVs at bars. Stunned racing fans gathered at the track as it burned to the ground.

In 19 days, a temporary facility was constructed, and the 1993 racing meet continued for its final 60 days. But Katrina was different.

After the hurricane hit, the 2005-06 Fair Grounds meet had to be canceled. The majority of the tin roof on the clubhouse had been ripped off by Katrina's winds, almost like an opened can of tuna. Water, up to 8 feet high, flooded the 46 barns, 1,837 stalls and dorm rooms that shelter employees during the season. The track runs Thanksgiving to late March, so thankfully, with Katrina's arrival in August, no horses were on the premises. (In 2008, the track began hosting quarter horse racing in August and September.) The water made it onto the apron and the infield, soaking it with damaging salt water, but did not reach the grandstand or clubhouse facility.

Being out of season, there wasn't a ton of money on-site during Katrina. It was stored in safes and never threatened. But that wasn't the case at an off-track betting parlor in Arabi, a hard-hit community along the eastern bank of the Mississippi River.

"All of that money was underwater, in a safe, but really funky," said Randy McCloskey, a financial officer for the Fair Grounds.

Months later, the funky money was brought back to the racetrack, where McCloskey and others literally laundered it in the washing machines normally used by the jockeys to wash their silks. "When we dried it, we put it in one of those little bags that women put their delicates in," McCloskey said. "Well, the dryer disintegrated it, like confetti. We only did that once."

The 2005-06 meet was moved to Louisiana Downs in Shreveport, along with outside employees, while the track was repaired (inside executives were moved to Churchill Downs, which bought the Fair Grounds in 2004, the year before Katrina). While this served as a blow to struggling New Orleans, it was a huge relief to track workers -- some of whom wondered whether this was the end of racing at the Fair Grounds. Mario Torres, a 25-year veteran of the track and a former jockey, was one of them.

Riding through the maze of green barns and stables on a golf cart this August, Torres points to all the improvements that have been made to the bustling backside of the track. The barns have a fresh coat of dark green paint. There's a new dorm facility for workers. Employees joke with each other while washing the horses.

"This is the best it's ever been," said Torres, a Panamanian who, after hanging up his silks, continued to work at the track. He's the go-to guy when employees need something.

For a month after the storm, Torres didn't know what was next for him. He remembers sitting in his backyard and getting a call from then-president and general manager Randy Soth, asking, "Are you ready to go back to work?"

The Fair Grounds reopened for racing on Thanksgiving Day 2006 to a packed house. The traditional corned beef was served. A group of youngsters, all decked out in elegant 1930s attire, added to the already festive and emotional day. Longtime trainer and New Orleans native Tom Amoss was there. Thankfully, so was his favorite pack of veteran handicappers, who he had gotten to know over the past three decades racing at the Fair Grounds. They'd always ask Amoss about his chances, and he'd try to give them honest feedback about his horses. They built up a camaraderie between trainer and handicapper.

"The year of Katrina, when we had to race at Louisiana Downs, I thought about those guys a lot," Amoss recalled earlier this month. "I wondered if they made it OK. So that first Thanksgiving back was really a reunion. And it was a wonderful reunion, because to a person, they were all there. We shook hands, hugged and there were a few tears in our eyes. It was the beginning, in my opinion, of the resurgence of the Fair Grounds."

On a muggy Sunday in August, local handicapper Bobby Bouchert sits on his barstool across from the ticket window at the Fair Grounds. Ten years after Katrina, it would be a stretch to say the Fair Grounds is thriving. At this point, though, the national downturn in horse racing is more to blame than Katrina. But the Fair Grounds still is surviving: The track now offers quarter horses during the offseason, along with exotic animal racing featuring ostriches and zebras.

Bouchert, 66, is happy, wearing his LSU baseball hat, drinking a beer and thinking back on his life at the track. He has been a regular at the Fair Grounds since 1963. In his early days, he would park next to the track and peer over the fence with binoculars to catch the races before relaying the results back to the bookmakers who could be found all over the neighborhood.

When asked if the track and city feel back to normal these days, Bouchert looks out from under his hat and says, "It's better in some aspects, but still not the same."