JCC Harrah’s New Orleans Casino faced bankruptcy due to an extreme annual tax and needed to rally the support of the people of New Orleans to broker a new tax agreement with the city and state. APCO Worldwide effectively designed and built a grassroots constituency to spread the message that closing Harrah’s doors would have a deeply negative impact on the city and on the casino’s 3,000 employees. The campaign resulted in the Louisiana House of Representatives passing LB1, which provided a tax reduction and allowed Harrah’s to remain open. The success of the campaign also convinced the casino to continue to invest in building and educating grassroots supporters.
Thanksgiving 1995 is one holiday Harrah’s Jazz Casino employees will never forget. On November 24, 1995, the day before Thanksgiving, Harrah’s Jazz Casino locked its doors, filed for bankruptcy and put 2,500 employees out of work. To make matters worse, one week prior to the closing of the casino, a full-page ad had been placed in the Times Picayune touting the casino’s commitment to the city and the state.
Three years later, in 1998, when the newly-formed Jazz Casino Company (JCC) won the bid to re-open as Harrah’s New Orleans Casino, an overwhelming feeling of mistrust remained. Harrah’s was also strapped with a $100 million dollar minimum annual tax and severe restrictions on important amenities such as hotels and restaurants. By 1999, it became obvious that the casino could not survive under the current tax agreement (an effective tax of 46%) and operating restrictions. Harrah’s Entertainment, Inc. had guaranteed the tax payments through March 31, 2001, but after that, there would be no way to continue making the tax payments. The clock was ticking.
JCC Harrah’s New Orleans Casino had one year to broker a new tax agreement with the city and state or face closing its doors one more time. Harrah’s knew it faced an uphill battle to secure a tax reduction and that very few people would champion its cause.
APCO conducted a series of focus groups in March 2000 and regular regional and statewide polling throughout the campaign. APCO also conducted thorough message testing.
Research showed that there was an overall feeling of mistrust of the casino. Harrah’s Entertainment Inc., the national company, was perceived as an “outsider” with no commitment to the local community. The public had little knowledge of the substantive jobs provided at the casino and there were misperceptions about “who” in the state was benefiting from Harrah’s $100 million dollar payment to the city and the state.
APCO was responsible for organizing and aligning Harrah’s strategic campaign team, ensuring that all members of the campaign (grassroots, government relations, employee relations, vendors, etc) were given a voice in decisions being made and plans being created. This organized network of supporters was crucial to the success of the campaign and added value in creating messages that resonated with various target audiences.
Target audiences for the campaign included: members of the Louisiana State Legislature, members of the New Orleans City Council, the Mayor of New Orleans, members of the Mayor’s Blue Ribbon Commission, members of the Chamber of Commerce, employees, vendors, community organizations, the Restaurant Association and the Hotel Association.
Another key audience was the media, specifically key local and regional media, including the local news channels (network and independent); local newspapers; news radio stations; and the wire services.
· To keep the casino doors open and save 3,000 jobs;
· To obtain a financially responsible tax structure;
· To continue operating after April 1, 2001;
· To generate a solid constituent base to lobby for the casino’s tax reduction;
· To take the focus off of gaming and help the city/state realize the economic impact of the casino;
· To gain support from the local business and hospitality community; and
· To persuade the Hotel and Restaurant Associations not to work against the casino’s efforts to ease its amenities restrictions.
· Create a message that resonated with all of the casino’s target audiences;
· Build a constituent base that would effectively carry the message to the target audiences;
· Influence public opinion through a simple, yet powerful message that would drive home the economic impact of the casino;
· Persuade elected officials statewide this was an issue of importance to the entire state;
· Influence the powerful and influential Restaurant and Hotel Associations not to oppose Harrah’s efforts to restructure its tax agreement; and
· Position the issue as a business/economic issue not gaming.
APCO designed and implemented a strategy to build an organized and vocal grassroots constituency to support the casino and make the issue about jobs and people, not gaming. To lead this effort APCO created “HEAT” (Harrah’s Employee Action Team) which consisted of the casino’s 3,000 employees and the message “3,000 jobs for 3,000 families.”
APCO was also responsible for developing third-party allies, such as the casino’s vendors, community organizations and the Chamber of Commerce, to speak on the casino’s economic impact and community contributions via testimonial ads, media briefings, resolutions of support and grassroots activities.
Building a Constituency
Stakeholders. APCO created Harrah’s Employee Action Team (HEAT), made up of employees and vendors. Beginning in June 2000, HEAT briefed employees on the tax issues, showed them how to be politically active and provided the resources to do so. APCO leveraged HEAT to recruit additional “Friends and Family” supporters who could be added to the database and activated as needed. APCO also helped JCC activate its vendors by reaching out through direct mail, hosting vendor receptions/briefings and easing vendor concerns by establishing regular communications on the casino’s financial situation.
Third-party allies. APCO worked with Harrah’s to secure resolutions from community and business organizations supporting the casino. APCO also helped Harrah’s build a strategic alliance with the New Orleans Regional Chamber of Commerce. That alliance included the Chamber’s resolution supporting the casino, direct mail and phone banking to chamber members on behalf of the casino and a statewide media tour.
Reframing/Positioning the Issue
Economic Impact Study. To firmly establish the issue as an economic one, Harrah’s commissioned and released a study of the economic impacts the casino had made on the city and state since its opening. The study highlighted the number of direct and indirect jobs created, the new household income generated and the casino’s position as one of the top 10 employers in the state.
Issue Education. APCO worked with the casino to institute periodic briefings and education sessions and coordinated a monthly newsletter from JCC’s Chief Executive Officer to keep the casino’s supporters informed about the issues.
Media. APCO produced radio ads featuring testimonials by employees, vendors and community organizations. Additionally, APCO created an earned media rapid response team to reply to negative media coverage and misinformation through letters to the editor, op-eds, and participation in call-in programs and interviews.
Working closely with the lobbying team, APCO coordinated grassroots pressure to targeted legislators. During the early stages of the campaign, APCO had HEAT generate a small but steady flow of letters and calls to legislators. As the campaign progressed, HEAT letters increased and APCO used phone banks to generate letters from vendors, Chamber members, friends and family. Employees and vendors began testifying in front of legislative hearings and commissions; displaying bumper stickers and posters of support for the casino.
Grassroots activity peaked in the weeks proceeding and during the special session. In addition to flooding legislators with letters, APCO coordinated seven days of bus brigades during which employees boarded buses to the state capitol, testified before House and Senate committees and created a constant presence in the capitol. At least 125 employees were in Baton Rouge every day of the special session.
By the end of the campaign, grassroots supporters had sent more than 30,000 letters to elected officials; more than 4,000 calls had been patched through and hundreds of employees had rallied in Baton Rouge.
Elected officials commented on the exemplary conduct of the employees as well as their consistency of message and knowledge of the issue. The media also commented on the professionalism and presence of the employees.
Our message “3,000 jobs for 3,000 families” was included in committee and floor debate, and was featured in every media shot and article covering the special session.
Legislators who were against the casino but who voted for the tax reduction stated that they voted for the jobs and the employees. On March 20, 2001 the employees got the vote they needed when the Louisiana House of Representatives passed LB 1, which provided for a tax reduction, an easing on amenity restrictions and allowed the casino to keep its doors open.
The success of this grassroots campaign has convinced the casino that HEAT should remain an ongoing casino program, and that the casino should continue to invest in building and educating grassroots supporters.