Joseph Jaeger Jr. is the most successful New Orleans businessman you’ve never heard of.
It’s not because he doesn’t have a compelling story to tell. He does. He spent his early childhood in the Lower 9th Ward, dropped out of college in the mid-1960s, and went from an apprentice plumber to owning the company he worked for — and then selling it for a mint in 2015.
Now he’s the biggest hotel owner in New Orleans, with a dozen more lodging and tourism projects in the works.
And while Jaeger has always avoided the limelight, he has stepped into the public arena this year for the first time, not to promote a business deal or a new hotel, but to fight a bill in the Legislature that he says is bad for taxpayers.
Jaeger (pronounced YAY-ger) has emerged as the biggest critic of legislation pushed by a team of lobbyists for owners of the Harrah’s casino in New Orleans. House Bill 553 would give Harrah’s a no-bid, 30-year extension of its exclusive license to operate a land casino in New Orleans in exchange for the company’s promise to invest $350 million to build a new hotel and other amenities and to increase its annual payments to the state by about 10 percent.
Jaeger thinks state lawmakers should push for a much better deal, and he is trying to persuade them to insist on better terms, especially since the state is so short of money for health care, jails and public education.
HB553 blew through the House with little opposition — Speaker Taylor Barras, R-New Iberia, is the sponsor, and Harrah’s lobbyists made sure to secure lawmakers of all political stripes as co-sponsors — and is now awaiting a hearing before the Senate Judiciary B Committee.
Jaeger visited the state Capitol for only the second time in his life on a recent Tuesday to buttonhole senators and was invited to the fourth floor, where he spent 20 minutes outlining his concerns to Gov. John Bel Edwards.
Jaeger first aired his criticisms in a letter to the editor of The Advocate last month.
“At a time when budget cuts could force the closure of hospitals and layoff of educators, and as the Legislature debates how to raise taxes on Louisiana citizens,” he wrote, “we cannot let the state lose out on the $500 million of revenue it could earn when it authorizes a 30-year contract for the downtown New Orleans casino.”
Dan Real, Harrah’s general manager, noted that Jaeger is virtually alone in the business community in publicly expressing opposition to a measure that the company says will create 600 construction jobs and 500 permanent jobs.
The Louisiana Restaurant Association, the Greater New Orleans Hotel & Lodging Association, the New Orleans Chamber of Commerce and other business groups — plus the Greater New Orleans AFL-CIO — have written letters of support, citing the planned investment, which includes a 340-room hotel.
“He’s going against the grain of the entire hospitality industry,” said David Satz, a senior vice president and attorney for Caesars Entertainment, Harrah’s parent company.
‘Not going to pout’
Of late, Jaeger has turned a portion of his attention to the Harrah’s deal. He questions why state legislators would renew the contract now, six years before it expires, instead of putting it out for bid in a few years to see how much more money the state could receive.
He notes that Harrah’s executives offered an upfront payment of $125 million to the state in 1994 to get the original 30-year license but are offering nothing upfront now for the 30-year extension.
Satz, Harrah’s attorney, said the $7 million per year in additional payments that the company is offering the city and state is roughly equivalent to the $125 million when inflation is factored in over time.
Jaeger also asks why the state hasn’t done an independent analysis of the Harrah’s deal.
At the state Capitol earlier this month, Jaeger met with half a dozen senators, including Danny Martiny, a Republican from Kenner who is listed as one of the Harrah’s bill’s co-sponsors. It’s not clear whether Jaeger is winning any converts.
“Why are you all doing this six years early?” he asked Martiny. “I don’t know,” Martiny said he replied. “I haven’t been actively involved in that thing.”
After Jaeger met with Edwards, a spokesman said the governor still supports the legislation.
Jaeger said he will turn back full time to his business projects if senators ignore his arguments and don’t insist on more money from Harrah’s.
“I’m not going to lose any sleep,” he said. “I’m not going to pout. I will have done my job trying to make sure everybody is educated as best I can try it.”
Read the full story at TheAdvocate.com.