S.D. Indian gambling revenue down, U.S. up
Posted: Thursday, August 28, 2008
SIOUX FALLS (AP) -- A drop in revenue from South Dakota's American Indian casinos contrasts with the national picture and with state-sanctioned games.
Casino City's Indian Gaming Industry Report shows Indian gambling revenue in the United States grew 5 percent in 2007, from $25.3 billion in 2006 to $26.5 billion last year. The money was generated by 425 facilities operated by 230 tribes in 28 states.
The same report shows Indian gambling revenue in South Dakota decreased from $100.1 million in 2006 to $97.1 million in 2007 from the 12 casinos operated by nine tribes. It was the second straight year for a decline.
The 2007 drop isn't large, said Alan Meister, an economist with Analysis Group, who wrote the report. "Three percent is fairly modest if you look at the national growth."
South Dakota and two other states -- Iowa and Mississippi -- showed a decline in Indian gambling revenue last year.
"If you look at it from an initial standpoint as location, it's not a high-population gross market as some other states," Meister said of South Dakota's drop.
South Dakota tribes must compete with other gambling, he said, adding that tribal-state gambling compacts dampen the tribes' opportunity for expansion.
Tribal-state compacts in South Dakota restrict the number of gambling machines tribes can operate.
But Jeremiah M. Murphy, registered lobbyist for the Great Plains Indian Gaming Association, said tribal gambling and state-sanctioned gambling are two different markets.
Tribal casinos are really destination gambling facilities -- places where people drive for dinner and a night out, he said.
But tribes are unable to pull in the market to establish casinos as destination gambling resorts because of the state's limit on machines, Murphy said.
The state limits tribes but has no limit on the number of video gambling machines it can operate, he said. "There's no limit except what the market would bear," said Murphy.
Meister's report notes that the Flandreau Santee Sioux Tribe has sued Gov. Mike Rounds, claiming he has not negotiated tribal gambling compacts in good faith.
"The ability to get new gaming compacts would certainly allow them to grow," said Meister.
The state's hesitance to negotiate tribal gambling compacts may be an effort to protect the state's own interests, he said.
An economic slump in the last quarter of 2007 slowed Indian gambling revenue nationwide, Meister said.
Murphy agreed. "The gaming industry nationwide is soft right now," he said.
South Dakota ranks 18th in state Indian gambling revenue.
Meanwhile, gross revenue was up 7 percent in Deadwood casinos during the first half of the year, while second-quarter figures show the income from state-sanctioned video lottery, scratch-ticket games and lotto games was up 4 percent from the same period last year.
Casino City's Indian Gaming Industry Report shows Indian gambling revenue in the United States grew 5 percent in 2007, from $25.3 billion in 2006 to $26.5 billion last year. The money was generated by 425 facilities operated by 230 tribes in 28 states.
The same report shows Indian gambling revenue in South Dakota decreased from $100.1 million in 2006 to $97.1 million in 2007 from the 12 casinos operated by nine tribes. It was the second straight year for a decline.
The 2007 drop isn't large, said Alan Meister, an economist with Analysis Group, who wrote the report. "Three percent is fairly modest if you look at the national growth."
South Dakota and two other states -- Iowa and Mississippi -- showed a decline in Indian gambling revenue last year.
"If you look at it from an initial standpoint as location, it's not a high-population gross market as some other states," Meister said of South Dakota's drop.
South Dakota tribes must compete with other gambling, he said, adding that tribal-state gambling compacts dampen the tribes' opportunity for expansion.
Tribal-state compacts in South Dakota restrict the number of gambling machines tribes can operate.
But Jeremiah M. Murphy, registered lobbyist for the Great Plains Indian Gaming Association, said tribal gambling and state-sanctioned gambling are two different markets.
Tribal casinos are really destination gambling facilities -- places where people drive for dinner and a night out, he said.
But tribes are unable to pull in the market to establish casinos as destination gambling resorts because of the state's limit on machines, Murphy said.
The state limits tribes but has no limit on the number of video gambling machines it can operate, he said. "There's no limit except what the market would bear," said Murphy.
Meister's report notes that the Flandreau Santee Sioux Tribe has sued Gov. Mike Rounds, claiming he has not negotiated tribal gambling compacts in good faith.
"The ability to get new gaming compacts would certainly allow them to grow," said Meister.
The state's hesitance to negotiate tribal gambling compacts may be an effort to protect the state's own interests, he said.
An economic slump in the last quarter of 2007 slowed Indian gambling revenue nationwide, Meister said.
Murphy agreed. "The gaming industry nationwide is soft right now," he said.
South Dakota ranks 18th in state Indian gambling revenue.
Meanwhile, gross revenue was up 7 percent in Deadwood casinos during the first half of the year, while second-quarter figures show the income from state-sanctioned video lottery, scratch-ticket games and lotto games was up 4 percent from the same period last year.
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