Yes, there’s more competition, and casino markets continue to mature, but Indian gaming revenues are still trending upward, notes Alan Meister, policy adviser for California-based Nathan Associates.
Meister releases an Indian Gaming Industry Report each spring. The final 2018 report will be out in about a month, but he gave a few insights to NIGA Convention and Tradeshow patrons late Wednesday afternoon.
The highlights: There’s still good growth in many states, and it continues to outperform the economy and other segments of the gaming industry. And, like commercial casinos, look for more growth via non-gaming amenities.
“However, in general, there is a maturation of markets,” Meister said. “They’re not going to grow as fast as they used to. Competition is coming in, not just from other segments, but in some cases from within Indian gaming.”
He also noted that government policies, such as compacts, artificially limit where the ceiling for Indian gaming could be.
Meister is wrapping up his 16th edition of his report, which has been documenting Indian gaming’s boom since the implementation of the Indian Gaming Regulatory Act in 1989. His earlier reports showed double-digit growth from 2004-06, but no year has shown more than 5 percent since then. (Native American gambling revenues declined only one year, 2009, at the tail end of the great recession.)
The new report has a photo of Pechanga Resort & Casino on the cover, which is appropriate, Meister says, because it reflects how gaming is changing. California’s largest hotel-casino recently went through a $285 million upgrade and expansion, all of it focused on non-gaming amenities.
To that end, Meister noted that non-gaming revenue is up 8.2 percent, compared to 3.9 percent for gaming, when comparing 2016 to 2015.
“In the context of where things are (now), this is pretty good growth,” he said.
When IGRA was passed in 1988, Native American gambling revenues were at $121 million. For 2016, the figure Meister reports is $31.5 billion.
Meister pointed out that 246 tribes operating in 28 states use the revenue to fund day-to-day operations. After expenses, the money goes for public safety, health care, housing, social services, educational youth training and elderly care.
“In many places, the casino dollars go to help people who are truly poor,” he said. “The money is truly needed.”
The results, and the complete study, will be out in about a month. While money gleaned from commercial casinos is subject to taxes – and thus the revenue figures are public – Indian tribes don’t have to spill their information. So, to put together his long-running study, Meister relies on confidential data provided by casinos and tribes, and then aggregates the information, in most cases to the state level, to protect that confidentiality.
“The good news is that I had the best participation I’ve ever had in terms of getting confidential data, so I could hone in and fine-tune the analysis I do, and I didn’t have to rely as much on estimations as on actual data.
“The bad news is it means a longer wait to complete the study because it takes longer to get the data.”
