Skip to main content

Comprehensive Indian gaming report released

  • Author:
  • Updated:

SACRAMENTO, Calif. - While American Indian gaming grew at a fairly robust
rate of 12 percent and grossed a total of $19 billion in the past year,
there are signs that growth may be slowing in some regions of the country
while gaining in others.

These and other figures are now available in what is perhaps one of the
most comprehensive reports on Indian gaming. The 88-page report was done by
economist Alan Meister of the Analysis Group, a Los Angeles-based financial
consulting firm.

Oklahoma topped the list of states that showed the greatest rate of growth
in the past year and tops the list with a very healthy 46.4 percent gain.
However, California casinos still took in the greatest total dollars at
$5.3 billion.

Healthy gains were also seen in Arizona, which increased 25.9 percent; and
in Florida and New York, whose rates of increase were 34.3 and 26.5,
respectively. Arizona has recently allowed blackjack, which may be one of
the reasons for the increase.

However, some areas showed a more laggard rate of growth. For some states
such as Michigan, which clocked in at a paltry 0.1 percent, growth has been
minimal. However, tribal casinos in the state still took in $971 million.

Among the top 10 gaming states in which Indian gaming grew the least,
Connecticut checked in at a 3.5 percent growth rate; Minnesota, 1.2
percent; and Wisconsin, 1.3 percent.

Connecticut, however, still ranked second only to California in terms of
total revenue dollars, with $2.2 billion. That state is home to the
Foxwoods megacasino operated by the Mashantucket Pequot Tribe.

Even California, with its relatively energetic 13.3 percent increase,
showed a drop-off from a nearly 28 percent expansion in 2003.

However, despite some regional slowdowns, the report said that American
Indian gaming is still growing at about twice the rate of commercial casino
gaming nationwide.

William Thompson, a University of Nevada, Las Vegas professor and gaming
consultant who recently completed a book on American Indian issues, said
that a slowdown in gaming expansion is inevitable.

Scroll to Continue

Read More

"Gambling markets tend to mature after five years," said Thompson. Since
this has is roughly the same amount of time since large-scale American
Indian gaming began, the slowdown may be reflecting the market.

Thompson noted that the overall growth rate of 12 percent is still very
healthy; however, he said this also reflects gaming expansions in certain
areas. Though he did not have the exact figure in his hands, Thompson said
that the growth rate for established tribal casinos is in the 3 - 4 percent

Another factor accounting for the larger growth areas, he said, has been
the recent relaxation of rules allowing for casinos in states such as New
York and Oklahoma, something also cited in the report.

In Florida, even Gov. Jeb Bush - long a gaming opponent - wants to come to
the table with tribes regarding casinos. Thompson said that changes in laws
and attitudes are resulting in the growth in those areas.

However, the Meister report also cited slow growth in areas where gaming
has already been long established. New competition from other states is
beginning to put the squeeze on states with established casinos. For
example, an expanding market like New York may entice gamblers who formerly
would take the trip over to Connecticut.

Thompson said that since there is a finite market for gaming once too many
casinos open in any given area, they are just "carving up the same pie into
smaller pieces."

Any given tribal casino is constrained by its proximity to population
centers. Thompson concludes that the future for Indian gaming may be in
multi-tribal efforts that would distribute income among more tribes instead
of tribes competing against one another.

In fact, a proposal already wending its way through Congress would zone
certain districts for Indian gaming and allow tribes in more remote areas
to operate gaming and other establishments within certain designated zones.

Also in the Meister report were figures on revenue sharing with state
governments. In total, tribes shelled out $900 million nationwide, a nearly
24 percent increase from the previous year. The largest state increase was
in Wisconsin, which saw the amount of revenue shared with tribes increase
about 300 percent.

Connecticut, whose casinos contribute over $411 million, or nearly 25
percent of their profits, to the state, led the revenue-sharing list in
sheer dollars. That number far outpaces California, a state with several
more casinos, whose tribal gaming operations anted up slightly over $153
million to the state. However, California's rate of revenue sharing shot up
more than 16 percentage points over the past year.