The new Four Winds Casino South Bend in Indiana, owned by the Dowagiac, Michigan-based Pokagon Band of Potawatomi Indians, opened January 16 in a ceremony featuring tribal drumming, presentation of flags and a ribbon cutting. It’s the fourth Four Winds Casino—the other three are located in Michigan—and the first tribal casino in Indiana. Frank Freedman, chief operating officer at Four Winds Casinos, said, “This is an incredibly exciting time for all of us. This ribbon cutting signifies the work of hundreds of people over the course of the past 13 months. We’re proud to cut this ribbon today for the first tribal casino in the state of Indiana and the fourth Four Winds property.”
National Indian Gaming Association Chairman Ernie Stevens, Jr. said, “I congratulate the Pokagon Band on this historic grand opening event. This event is more than celebrating the opening of the Four Winds South Bend Casino; it will be another great testament to the success of Indian gaming and all that it will bring to tribal communities.”
The Bureau of Indian Affairs approved the Pokagon Band’s application to take into trust 166-acres of tribal land in South Bend in 2016. The decision restored the Pokagon Band’s ancestral homeland in Indiana.
Chairman John Warren said the tribe’s casinos help provide the 5,000-member tribe with health care, housing and education programs, and created 1,200 new jobs in South Bend.
The 175,000 square foot Four Winds South Bend offers 1,800 slot machines and electronic games, four restaurants, players lounge, coffee shop, three bars, retail outlet and 4,500 parking spaces including an enclosed parking structure. Live blackjack and roulette will not be offered since the tribe has not negotiated a compact with Indiana.
The state will not receive state taxes from the new Four Winds South Bend because it’s owned by a federally recognized Indian tribe that does not have a compact with the state of Indiana. But the tribe will pay 2 percent of its profits to the city of South Bend under a local agreement. The band also committed to paying $5 million over three years to community programs. The tribe has a compact with Michigan, allowing table games at Four Winds New Buffalo, Dowagiac and Hartford. But under the compact the tribe has to pay 8 percent of its slot revenues to Michigan.
In contrast, Indiana’s 13 state-regulated casinos, operated by private companies, paid 27 percent in state and local taxes on gambling profits in 2017. A study by Spectrum Gaming Group commissioned by the Indiana Casino Association, which represents 11 of Indiana’s 13 commercial casinos, indicated the tax differences gives the new tribal casino an “enormous marketing and pricing advantage, particularly in slot payout rates.”
When the Pokagon Band opened its first Four Winds casino just across the Indiana state line in New Buffalo, Michigan in 2007, that event significantly impacted Boyd Gaming’s Blue Chip Casino in Michigan City, resulting in a loss of $50 million in revenue in the first year, which has since dropped from $267 million in 2007 to $159 million in 2017.
But David Strow, a vice president at Boyd Gaming, said, “We have seen several new casino properties open in this region over the last 10 years, and Blue Chip has continued to compete successfully each time over that timeframe.”
He added the company has features and amenities that distinguish it from Four Winds South Bend, including a hotel, spa and table games.
Meanwhile, gambling competition has increased in other neighboring states, resulting in a 20 percent drop in Indiana casino profits and the loss of 3,000 jobs since 2009, according to the Indiana Gaming Commission. Casino tax revenue of $442 million in 2017 was a decrease from $680 million in 2010, and it’s expected to fall to $388 million in 2019. House Ways and Means Committee Chairman Tim Brown said, “I have told people we will just deal with the activity that we can estimate and that’s what we’ll plug into our formula. We’re not going to try and necessarily make it so that it can make up a certain percent of the budget.”
Tribal officials also expect Four Winds South Bend to draw customers away from two of its three Michigan casinos in New Buffalo, and Dowagiac. Freedman said ultimately that migration of customers will result in a net gain.
“You basically do feasibility studies, and understand what that migration might be,” said Freedman. “The net effect is plus, plus, plus. So some of our guests that currently frequent New Buffalo that live here, it will be natural to start coming here.”
Freedman also noted, “New Buffalo was built with table games and was built with an expectation, with a hotel, of a longer visit. In South Bend we’re going to market to an urban environment, more day trippers. So if a group’s coming in to see a Notre Dame game and want a party of 25 at the steakhouse, we can do it.”
South Bend Mayor Pete Buttigieg pointed out, “You look at the growth in the growth and what’s happening economically, and there’s a lot of momentum in the city right now. But one thing that will be on the history books even 100 years from now is that the first time there was ever a federally recognized tribal land in the state of Indiana, it was right here in South Bend.”
