The U.S. commercial casino industry topped the $40 billion mark in total gaming revenue in 2017, according to a new report from the American Gaming Association.
Of the 24 states with commercial casinos, roughly 460 in total nationwide, 20 states reported year-over-year revenue increases. Meanwhile, states received a combined $9.23 billion in gaming taxes.
The annual “State of the States” report is published by the AGA, the Washington D.C.-based gaming trade organization, to give an overview of the commercial casino industry and its economic impact on states and local communities.
“This year’s report demonstrates the commercial gaming industry’s ongoing role as a job creator and revenue generator in states across the country, and we’re proud of the industry’s steady growth over the past few years,” AGA interim CEO Stacy Papadopoulos said in a statement.
The $40.28 billion in total gaming revenue was a 3.4 percent increase over 2016. Eleven states — Colorado, Florida, Kansas, Maine, Maryland, Massachusetts, New York, Ohio, Oklahoma, Pennsylvania and Rhode Island — reported record gaming revenue. Casino openings in Maryland and New York, and expanded gaming in other states, played a role in the increases.
According to the report, commercial casinos supported roughly 737,450 jobs in the 24 states, counting both direct jobs with casino properties and indirect positions with vendors and support businesses. Those jobs totaled more than $34.3 billion in wages, benefits and tips, according to Oxford Economics, which helped produce the report.
The tax revenue figure was 3.1 percent increase over 2016.
In the report, the AGA highlighted the “intensifying competition” within the casino industry beginning in 2017 and continuing this year.
Sara Slane, the AGA’s senior vice president of public affairs, said clearly the increased competition has led to some market saturation issues. The association has advocated for individual states to streamline certain policies and regulations.
“We’ve learned that exorbitant tax rates don’t work,” she said.
The opening of the MGM National Harbor in Maryland across the Potomac River from Washington D.C. in late 2016 helped drive the state to a record $1.6 billion in gaming revenue, a 34 percent increase. However, a few of Maryland’s resorts reported declines due to the competition.
In New York, new casinos helped grow revenue 16 percent to $2.3 billion, although some of the state’s individual casinos continue to under-perform. In Massachusetts, the $960 million MGM Springfield opens Friday and the $2.4 billion Encore Boston Harbor opens early next year.
“Competitive pressures are set to grow in key commercial states in the coming years,” the AGA wrote in the report’s executive summary. “(The) two commercial properties … will reshape the competitive landscape of the New England region.”
In June, Atlantic City rebranded and reopened two Boardwalk resorts which were among the five that closed over a two-year period. The state’s gaming revenue in 2017 were $2.65 billion, an increase of 2 percent, which marked “a second consecutive year of modest revenue growth after a decade of unbroken declines that followed the launch of casino gaming in Pennsylvania in 2006.”
The top three individual commercial casino gaming markets did not change year-over-year. The Las Vegas Strip continued to be the No. 1 market, with $6.4 billion in gaming revenue in 2016. Atlantic City was second with $2.4 billion, followed by the Chicagoland area – which includes casinos in Illinois and Northern Indiana – with $1.97 billion. Baltimore/Washington D.C., which includes Maryland and West Virginia, took over fourth place from New York City with $1.77 billion, largely due to the opening of MGM National Harbor. New York City fell to fifth with $1.57 billion.
The report excluded state gaming revenue and taxes from distributed gaming – video lottery terminals or video gaming devices operated in bars, taverns, truck stops and convenience stores. The states included Illinois, Louisiana, Montana, Nevada, Oregon, South Dakota, and West Virginia.
Video lottery terminals in Illinois are viewed as responsible for the state’s less than 1 percent decline casino gaming revenue. Mississippi, New Mexico and West Virginia were the only other states with revenue declines in 2017.
The commercial casino industry does not include revenue from more than 500 Indian gaming operations across the U.S.
Earlier this year, the National Indian Gaming Commission said total nationwide tribal gaming revenue was $32.4 billion in 2017, a 3.9 percent increase. Ernie Stevens, Jr., chairman of the National Indian Gaming Association, said tribal gaming revenue has nearly tripled from $11 billion since 2000.
Slane said a goal of the AGA is to “get to a point” where one report would cover “tribal, commercial and convenience gaming.”
Howard Stutz is the executive editor of CDC Gaming. He can be reached at hstutz@cdcgamingreports.com. Follow @howardstutz on Twitter.
