FLAGSTAFF, Ariz. (AP) — Casinos run by the Navajo Nation have temporarily laid off more than 1,100 workers because of prolonged closures caused by the coronavirus pandemic.
The tribe's Navajo Nation Gaming Enterprise announced the decision Thursday night, saying it was left with no choice but to move ahead with the layoffs because of lack of revenue caused by the closures.
"Due to the extended closure, since March 17, 2020, our business operations have been severely impacted and as a result, we must make very difficult financial and personnel decisions," Brian Parrish, the tribal casino operation's Interim CEO, said in a statement. The layoffs took effect on New Year's Day.
The tribe operates four casinos in Arizona and New Mexico, and together they employ more than 1,200 people, including more than 775 tribal members. The Gaming Enterprise plans to keep 165 employees on the payroll to ensure essential functions are maintained at the casinos.
Officials had repeatedly warned that layoffs would become necessary if the casinos weren't allowed to reopen at least with limited capacity.
But officials also warned Thursday that permanent closure of the entire operation is possible by the end of January if casinos are not allowed to reopen or if more funding isn't allocated to keep the operation running. The tribe allocated nearly $25 million in federal virus relief funding to the casino operation in August but that money has run out.
The tribe invested $460 million in the casinos and that would be lost if they closed. Closure would also lead to ongoing yearly losses of about $220 million in revenue and economic activity, Parrish said. He said he believes it's possible to safely reopen with reduced capacity even amid the pandemic.
"The Nation's vision took years to build but the Nation has been successful," Navajo Gaming Board Chairman Quincy Natay said. "If it allows its gaming industry to fail, a permanent closure will cause a long-term setback for Navajo economic development, even if it eventually reopens."
The Navajo Nation spans parts of Arizona, New Mexico and Utah.