Most people lose money at the Trump Taj Mahal – that’s the way casinos work. But if you’re investor Carl Icahn, billionaire owner of Atlantic City’s decaying but still opulent, elephant-fronted Taj, you have some odds in your favor.



Icahn bought Republican presidential hopeful Donald Trump’s troubled New Jersey casino operations out of bankruptcy in March. Now he says striking workers have made it impossible to turn around a property that has lost him $100m and he will close the casino after the Labor Day holiday on 5 September. Regulatory filings show he is unlikely to leave the casino out of pocket.

Icahn has made most of his money fighting battles with management as an activist shareholder. This time, as the owner of Trump Entertainment, he is fighting its employees, mainly members of the local branch of hotels and casino union UniteHere.

Carl Icahn. Photograph: Mark Lennihan/AP

Icahn, who did not respond to calls or messages for this article, accuses the union of forcing management into expensive healthcare and retirement plans that pad the union’s coffers. The union says Icahn is a raider who used expensive loans to squeeze the Trump Taj Mahal into bankruptcy and then used the legal proceeding to shaft the workers. The union also points to another Icahn casino – the Tropicana – which earlier this summer agreed to the union’s full benefits package, as did three other Atlantic City casinos that are controlled by rival Caesars Entertainment.

“We feel real, real disrespected that you would give to one part of your company and not give to the other,” said Chuck Baker, a 56-year-old cook who has put in 26 years at the Trump Taj Mahal. Baker is one of about 1,000 workers who walked out on 1 July, after refusing an offer from Icahn that was less than half that agreed by Icahn’s Tropicana and other casinos. Most of the workers earn less than $12 an hour.

“Icahn Enterprises is a business with shareholders and legal duties to those shareholders,” Icahn wrote to workers in a letter posted on his website, a day after the announcement the property would close after Labor Day. “It is one thing to fund losses when a path to profitability exists; but, to burn tens of millions of dollars when there is no hope is just foolish.”

But the same day as he wrote that letter, Icahn’s holding conglomerate Icahn Enterprises told the Securities and Exchange Commission that its interest in Trump Entertainment Resorts – which is the Trump Taj Mahal and the former Trump Plaza, a casino that has been “idled” since 2014 – was worth $126m, “resulting in a $16m gain on investment activities”. In a separate statement to shareholders, the company said its interest in Trump could be worth as much as $200m, under a different valuation method. Still, conceded the SEC filing, “the Trump acquisition is not material” to Icahn Enterprises’ financial statements. That is because, even at $200m, it is less than 5% of the conglomerate’s investment portfolio, net of debt.

Icahn is right that the Taj Mahal itself has been losing money this year – although it eked out a small operating profit amid bankruptcy last year – but workers including server Marc Scittina said that is in part because it has been operating with an overworked skeleton crew for its size and number of hotel rooms. Scittina, 54, has been skipping doctors’ appointments now that he has an Affordable Care Act plan that has high deductibles. Some of his colleagues are uninsured. “Icahn needs to do the right thing, be fair,” Scittina said, sweating on the hot boardwalk.

The cost of providing the full healthcare package for Trump Taj Mahal employees for a year would be several million, the union says. It would be about the same amount as the $4m Tropicana paid to buy back its own stock in the last quarter, union reps point out. For the workers, it is the difference between a $12-an-hour job with a $3 benefits package that leaves them on the hook for their family’s healthcare and their own hospital visits, or a $6.65 benefits package that they say would give them a decent, middle-class life. Currently, workers say, the Taj is paying $20 an hour to scabs to staff the hotel, restaurants and gaming services.

The fight has become political, in large part because it tangentially involves Donald Trump, who Ichan is championing for president. Trump Entertainment is a black spot on Trump’s business record and has filed for bankruptcy four times. Trump himself has had nothing to do with the Atlantic City enterprise for the better part of a decade. But the striking Taj workers were used as poster boys and girls forHillary Clinton’s campaign when she passed through Atlantic City last month. This week Icahn argued Trump’s economic policies could still secure him the White House.

Ichan could flip the Taj Mahal now for a profit but for Atlantic City, the loss of more than 2,000 full- and part-time jobs would be another big blow. The city is struggling to meet its debt payments, in large part because casino owners like Icahn have fought a long, successful campaign to reduce their property taxes and stymie other business development in the city that might threaten their dominance. The Sands casino – which, like the Taj, was bought by Icahn from bankruptcy and then sold for a profit in 2006 – is now a vacant boardwalk-fronting eyesore of a lot. The local development agency, which is supposed to use casino taxes for the greater good of the city, recently heard a plan to convert the former Sands lot into parking. The same agency has spent millions in the last five years on the casinos themselves, including $7m for the oversized gold lettering that announces the Trump Taj Mahal’s boardwalk entrance.

Outside that entrance, a dozen workers filed back and forth on Tuesday chanting “Stronger together!” and other upbeat rallying calls. “These people here outside? They worked so hard,” says Maritza Luna, 58, a Trump Taj Mahal housekeeper since it opened in 1990. Luna, whose job involves maneuvering a 300lb cart laden with cleaning chemicals, guest toiletries and linen up to six days a week, misses many of her colleagues who earlier this year took part-time jobs at other casinos, where they are required to clean just 14 rooms a day compared with the Taj’s mandated 16 rooms. Luna needs back surgery as a result of an injury she sustained last year at work. After she hired a lawyer, the casino management agreed this week to pay for her surgery. “Why’s he doing this to us?” she asks. “He’s a rich guy!”