(Adds Atlantic City mayor quote, background on gaming in U.S.)
By Barbara Goldberg and Sruthi Ramakrishnan
June 27 (Reuters) - Caesars Entertainment Corp.'s decision to close its Showboat casino makes it the second gambling house shuttered in what New Jersey Governor Chris Christie had called a crucial year for the future of gambling in Atlantic City.
Debt-strapped casino operator Caesars said it would shut the Showboat in August because of falling revenue and high property tax in Atlantic City. It will be the second to close this year, after the Atlantic Club Casino Hotel closed its doors in January.
The closure will reduce to 10 the number of casinos in the Jersey Shore city, down from 12 last year, when Christie said he would consider allowing casinos to be built elsewhere in New Jersey, possibly in the Meadowlands, if the sagging gambling industry failed to show signs of revival in 2014.
Revenue from Atlantic City has declined by more than $3 billion since 2006 as competition has grown, Caesars Chief Executive Gary Loveman said in a statement.
With more states embracing legalized gambling, including online gambling, customers and revenues are being stretched in Atlantic City and elsewhere in the United States, said Jeff Guaracino, chief strategy officer of the Atlantic City Alliance.
"What you have here is a gaming issue nationally. This isn't an Atlantic City issue, (it's) the rapid expansion of gaming in the United States, yet gaming revenues have not be able to keep up," Guaracino said.
Delaware's Senate this week approved a nearly $10 million financial bailout for the state's three casinos. In Tunica, Mississippi, Caesar's closed its Harrah's Casino Tunica this month after a county-wide decline in gambling tax revenues from $47.3 million in 2006 to $28.3 million in 2013.
Amid the nation's shifting gambling tableau, Atlantic City is finding new footing to attract different kinds of tourist dollars, with Caesar's building a conference and convention center and large-scale retailers such as Bass Pro Shops moving into town.
"Atlantic City is creating new jobs, building new attractions and diversifying our economy beyond just gaming," said Mayor Don Guardian.
Caesar's brought the Mardi Gras-themed Showboat property into its fold when it bought Showboat Inc for about $512 million in 1998. It also took on about $635 million of Showboat debt in the deal.
Caesars said on Friday it would provide preference to the displaced Showboat employees for available positions at its other three properties in the city. The company had about 68,000 employees at the end of last year.