Economic Spin-off's of Tribal Casinos
Native American casinos owed their very existence to both a U.S. Supreme Court ruling and a 1988 law granting tribal governments special privileges. One wonders what degree of financial success they have to show for all the criticisms hurled at the industry about regulatory compromises, tax privileges, corruption and accusations of fronting for non-qualified mainstream Americans.
Data on Indian gaming net revenues, sometimes referred to as net win (dollars wagered minus payouts), indicates a very rapid rise in revenues, especially in the years immediately following passage of the Indian Gaming Regulatory Act (IGRA). By 2003, it was estimated that tribal gaming venues had reached a gross revenue of $32 billion, nearly half the $72.9 billion taken in by the gaming industry as a whole and outpacing, remarkably enough, the $28.7 billion take of all other casino venues around the country.
In part, such a remarkable market share stems from the sheer scale of some tribal casinos. Indian properties may be off the beaten track - i.e., no properties in Las Vegas, Reno or Atlantic City - but the largest casino in the country, Foxwoods in Ledyard, Connecticut, is owned by the Mashantucket Pequot. Last year (2006), the Chickasaw Nation opened the doors on the largest casino in Oklahoma, Riverwind.
A second success factor is judicious location near important cities on both coasts. Foxwoods may be in the Connecticut countryside but it is within easy driving distance from four of the East Coast's major cities - New York, Boston, Hartford, and Providence - and this doubtless ensures brisk business at more than 7,000 slot and video poker machines and 380 game tables in the resort-and-golf-course complex. In general, much of the tribal-establishment gross revenue is spun off by casinos located in, or near, large metropolitan areas.
The revenues generated in tribal casinos spread throughout 28 states can be substantial. As a group, the more numerous reservations (and gaming properties) in the Central United States took in gross revenues of about $5.9 billion in 2002, followed by those located in the Western United States ($4.8 billion). Properties in the East lagged behind with a gross take of approximately $3.8 billion that year.
Most tribal casinos, particularly those in the midwest and the Great Plains, average rather modest gross revenue and net win. What little they make, nonetheless, has helped to roll back reservation unemployment and poverty rates, as well as provide essential services that would not otherwise be available.
On social services, for example, tribal governments are now able to put up daycare centers and elder-care programs. Other community needs they have been able to provide are education (specifically, school buildings), medical and dental facilities, police and firefighting forces, housing and even alcoholism-treatment centers.
As to employment benefits, the 220 federally-recognized tribes that operate 360 Indian gaming venues boast of having generated 600,000 jobs, directly and in support industries. More importantly, tribes such as the Chickasaw have been able to add manufacturing to the economic base of previously-deprived reservations.
Though socio-economic deficits remain, tribal governments flush with cash from their casinos have apparently made significant strides in reducing poverty. Over the 16 years when they operated two casinos, for example, the Mille Lacs tribe of East Central Minnesotta reportedly slashed poverty incidence in their reservation by over three-fourths, from 81% to just 15%
Born as a form of accommodation to Native Americans, tribal casinos have proliferated and generated enormous revenue share. And there is evidence that proceeds or "net win" dollars have gone a long way to uplifting the socio-economic lot of over 200 federally-recognized tribes.