HARTFORD, Conn. (AP) — Spending by gamblers slowed at
U.S. Indian casinos in 2012, as revenue growth fell behind non-tribal
casinos for the first time in nearly two decades, according to a report
released Wednesday.
The weak economy also put a brake on tribal
gambling revenue, although it hit an all-time high, said Casino City’s
Indian Gaming Industry Report.
Casino City, a publisher of
gambling industry information, said racinos have outgrown Indian casino
gambling in 16 of the 19 years in which race track casinos have
operated. Revenue grew by 8 percent in 2012. But it’s been 18 years
since revenue at commercial casinos, which jumped 4 percent in 2012, had
a higher annual growth rate than Indian casinos.
"That was definitely something different," said Alan Meister, author of the report.
The
brighter comparison for commercial casinos is because more have opened —
four voter-approved casinos have begun operation in Ohio, for example —
and tribal casino markets are aging and locked in tough competition, he
said.
Indian casino revenue growth in 2012 slowed to 2 percent,
to $28.1 billion, down from 3.4 percent in the previous year and half
the pre-recession rate of 4 percent in 2007. Revenue increased at 66
percent of Indian facilities, with a surge of as much as 20 percent in
Alaskan casinos and a steep 8 percent drop at Connecticut’s two tribal
businesses.
After Alaska, states that posted the fastest revenue
growth were South Dakota, Montana, Alabama and Texas. The slowest-growth
states, after Connecticut, were Mississippi, Colorado, Idaho and New
York.
Gambling revenue is concentrated in a few states. Revenue
rose 1 percent, to $7 billion in California, which accounted for 25
percent of U.S. gambling revenue generated at 68 Indian casinos. With
Oklahoma, home to 118 gambling facilities, revenue in the two states
accounted for 38 percent of tribal casino revenue nationwide.
Revenue
has grown steadily at tribal casinos, from $121 million in 1988 to more
than $28 billion in 2012. But with casino growth, revenue that surged
by as much as 148 percent in 1989 has sputtered, dropping below 10
percent each year beginning in 2007.
Part of the reason has been the recession and weak recovery, but much of it can be blamed on the rising
number of casinos.
"There’s
only so much gambling that can be done, only so much disposable
income," Meister said. "You’re adding more and more gambling competing
for the same dollars."
The Northeast is the only place that’s
"tough going" due to intense casino competition, Meister said.
Connecticut’s Mohegan Sun and Foxwoods Resort casinos have posted
consistent declines in slot revenue over the past few years, citing
rising competition from New York and Rhode Island and the sluggish
economy.
Casino gambling is expanding in New York City, New York
state and Rhode Island, and casinos are being proposed and planned in
Massachusetts. As a result, the prospect for greater competition in the
Northeast will continue to present huge challenges to Indian casinos, he
said.
Indian casinos generally finance health care, housing,
education and other tribal activities. In March 2012, the Mashantucket
Pequots in Connecticut halted payments as the tribe’s Foxwoods casino
struggled with debt and other financial troubles. States also impose a
tax on casino revenue and legislators and governors are scrambling to
plug holes in state budgets as casino revenue drops.
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