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Tribes post record casino revenue; industry report lists Oklahoma figures for 2016 at $4.4B

by John Magsam | October 7, 2018 at 4:22 a.m.
Gamblers check out the casino floor during opening day at the Cherokee Casino in Grove, Okla., in January 2017. Tribal casino revenue in Oklahoma in 2016 was $4.4 billion, according to an industry report.

American Indian tribes in Oklahoma saw record revenue from their casino operations in 2016, according to a recent report.

Oklahoma saw tribal casino revenue of $4.4 billion in 2016, up 5 percent from the previous year and marking the 15th concurrent year for growth. Nongambling revenue, from things like hotel rooms and on-site restaurants, was $753 million, a 14.5 percent increase over 2015, according to Casino City's Indian Gaming Industry Report released last week.

Oklahoma had 31 tribes running 131 gambling facilities in 2016, though many of those operations are smaller, noncasino locations. The gambling machine count was up nearly 2 percent to 73,587 for the year, and the number of table games was up about 4 percent to 770.

Alan Meister, the chief executive officer of Meister Economic Consulting and author of the Casino City report, said slower growth nationally in tribal gambling revenue was linked to a general lag in the nation's economy and a slower pace of growth in personal income. He said the percentage of Oklahoma's growth in gambling revenue while less than last year still is greater than the national average and is considerable for a larger state with a more established casino market.

"We're seeing growth but slower growth when compared to 2015," Meister said.

He said the growth of noncasino revenue was significant for Oklahoma, with solid gains compared with national trends.

Nationwide American Indian casinos took in $31.5 billion in 2016, a 3.9 percent increase but down from 5.2 percent growth in 2015. It's the seventh year of consecutive revenue gains and an all time record. Nongambling revenue was up 8.2 percent to $4.2 billion, a record high.

Six Oklahoma tribes operate casinos that include hotels near Arkansas' western border, all of which feature restaurants and entertainment. While gambling is still the key revenue source, industry watchers have said for years that modern casinos must offer a variety of experiences if they want to stay competitive and lure customers from neighboring states and away from local competitors.

Kelly Way, associate professor in the hospitality management department of the Dale Bumpers College of Agricultural, Food & Life Sciences at the University of Arkansas, Fayetteville, said while gambling has been and will always be popular, the tribal casinos have done a good job at offering more and better nongambling amenities at their complexes.

She noted many have high-end meeting rooms, pools and spas, entertainment venues with solid headliners, and restaurants with high quality food and service.

Arkansas has no tribal-owned gambling, but betting is allowed on greyhound races at Southland Park Gaming & Racing in West Memphis and thoroughbred horse races at Oaklawn Racing & Gaming in Hot Springs. State law allows gambling on electronic devices at the racetracks that are similar to devices offered at out-of-state casinos.

A proposed constitutional amendment to authorize four casinos in Arkansas is facing legal challenges as its backers attempt to get their measure on the Nov. 6 general election ballot. Issue 4 would allow casino licenses for single locations in Pope County in or near Russellville; in Jefferson County in or near Pine Buff; and at or near Southland Park and Oaklawn Park.

The Quapaw tribe has said it's considering applying for the license in Jefferson County, and the Cherokee Nation has said it's interested in the Pope County license. Both tribes operate casinos in Oklahoma and near the border with Arkansas.

Tribes operate 246 casinos in 28 states but the Casino City report shows that most of the gambling revenue is concentrated in a few states.

California saw $8.4 billion in revenue for 2016, the highest of any state and makes up 26.7 percent of total revenue taken in by tribal casinos nationwide. Oklahoma was second with 13.8 percent of total revenue. Combined the two states took in 40.5 percent of tribal casino revenue in 2016. The next-closest states were Florida with $2.6 billion, Washington with $2.5 billion and Arizona with $1.9 billion. Combined, the top five states made up 63 percent of total U.S. revenue for American Indian casinos.

Gambling at American Indian casinos beat out traditional casinos and racetrack casinos to keep its place as top dog in the industry for the second year running. Traditional casinos saw a revenue increase of less than 1 percent to $30 billion, and racetrack casinos had growth of 1.6 percent to $8.7 billion. American Indian gambling operations now make up just shy of 45 percent of the total gambling market.

Along the border with Arkansas, Oklahoma tribes are continuing to open new locations and are expanding and renovating older facilities.

Cherokee Nation is building a casino as part of a large-scale retail development in Tahlequah, Okla. The 92,000-square-foot facility will have 525 electronic games, a cafe, full-service bar, a live music venue and a 144-seat restaurant. The location also includes 33,000 square feet of meeting space. The tribe held a topping-out ceremony at the site last week and expects to open the casino in the spring.

The Eastern Shawnee Tribe's Indigo Sky Casino in Wyandotte, Okla., invested $36 million on an expansion project, adding a second hotel tower that will include an additional 127 rooms, bringing its room count to 244, adding a 600-seat event center and expanding its restaurant. The project was finished in September of 2017.

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