By DAN REYNOLDS, senior editor of Risk & Insurance®
Turning away a plate of $395-an-ounce Iranian Golden Osetra caviar at SeaBlue at the Borgata
Hotel and Casino in Atlantic City, N.J., for the $5.95 "buy one wrap, any side and beverage, get one free" deal at the Bob Evans in Columbus, Ohio, may appear to be in poor taste.
But Bill Frese isn't looking at things that way.
"They have opportunities to grow in the Northwest and the Northeast, and having had the opportunity to interview with the CEO, I was very impressed with his plans for growth for the organization," Frese said. "So it felt like a very stable environment that I would be walking into: a company that has been very successful during the economic downturn with an opportunity to grow even more."
Frese, the director of risk management at the Borgata for the past four years, left May 14. He starts at Bob Evans Farms Inc. on May 24 as director of risk management for the Columbus-based restaurant chain, which operates the Bob Evans eateries and the Mimi's Cafe franchise.
One of the reasons for Frese's move from Atlantic City to Columbus will make good sense to anyone who has ever balanced a checkbook, or at least thought about it.
For one, Frese said that he has had enough of New Jersey taxes, which are among the highest in the country.
Frese has two children in the early to mid-teens, and the time has come for him to start thinking about saving, as in for college, as opposed to doling out money to state coffers.
"It is just a very difficult place to raise a family financially," Frese said.
Another reason, Frese added, is that the gaming industry in general is under tremendous pressure these days, although the Borgata is doing well.
Casinos in Atlantic City face stiff competition from neighboring states, Delaware and Pennsylvania, which are both undergoing an exponential expansion in gaming options.
Both states get table games this summer, and Pennsylvania, once it can get casinos in Philadelphia running, is expected to have more slot machines than any other state except Nevada.
RISK MANAGERS, WANTED?
"The Borgata is still going to be successful, but it certainly makes you nervous when risk management is perceived in an industry, not by the Borgata necessarily, but by an industry to be a nonrevenue generating department. You fear that that is where the cuts will start," Frese said.
Frese has only to look out the window, allegorically speaking, to see the risk managers lining up to take his position. There are plenty of qualified risk managers who have been cut or laid off in recent months. .
There are also gaming risk managers who have jobs and yet fear for them, to hear Frese tell it.
"There are a couple who currently have work in the gaming industry but are scared of their employer going under, so that is another pressure," Frese said.
Rick Santoro, the executive vice president of asset protection and risk management for Trump Entertainment Resorts, said that the economic downturn is a time for gaming risk managers, as with risk managers in many other sectors, to keep their eyes peeled.
"I think some of the issues that we face now are that we have to be much more conscious of people filing and generating false claims," Santoro said. The issue is true on the workers' comp side and on the casualty side.
For his part, though, Santoro said that he didn't feel that the risk management function in gaming is under any particular kind of pressure.
"I think that those that are progressive and are aware of emerging trends, have the ability to change their business model to be consistent with what the challenges are, are not feeling the pressure," he added.
Frese said that he is happy to be leaving the Eastern Seaboard for the more manageable and less expensive expanses of the Midwest.
Yet the move from the Borgata to Bob Evans isn't really that much of a stretch in some ways.
"We have 10 restaurants here (at Borgata), so I am familiar with the risks, and I am familiar with the types of claims that you deal with, and I am familiar with the types of insurance that would need to be in place. But this is on a much grander scale," Frese said.
Earlier this year, Lance J. Ewing, former vice president of risk management for Harrah's Entertainment Inc. and a past president of the Risk and Insurance Management Society Inc., left the gaming industry to join Chartis Insurance Co. as vice president of national accounts.
May 17, 2010
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