The just released “State of the States” the AGA Survey of the Commercial Casino Industry shows that, in the words of American Gaming Association’s (AGA) President and CEO Bill Miller “2018 was a transformative year for the U.S. gaming industry,” with commercial casinos experiencing a fourth year of revenue growth that rocketed it 3.5 percent to a record $41.7 billion. That rate also beat the national rate of economic growth. Miller became the third AGA head in December of last year.
The report is assembled for the AGA by London-based Gambling Compliance, a provider of “of independent legal, regulatory and business intelligence to the global gaming industry.”
There are 465 commercial casinos nationwide. The report defines commercial gaming as “licensed land-based casinos, riverboat casinos, racetrack casinos (racinos) and jai alai frontons. It also includes casino locations in states such as Delaware, New York, Ohio and Rhode Island that offer electronic gaming devices classified as video lottery terminals and are operated by commercial casinos under the authority of those states’ lotteries.”
Twelve states, or half the states where there is commercial gaming, reported record revenues last year, and almost all of the commercial gaming states saw some revenue increases. This also contributed to the local economy in each state, said Miller: “Growth in the commercial gaming sector enables the industry to continue to reinvest in communities, enhance partnerships with small businesses and nonprofits and provide career opportunities for nearly two-million American workers.”
The report attributes some of this dramatic increase to the legalization of sports betting in several states: “The rapid expansion of legalized sports wagering following the Supreme Court decision to overturn the Professional and Amateur Sports Protection Act (PASPA) in May 2018 played a role in the industry’s record year.”
“By the end of the year, residents in eight states were able to place a legal sports wager with more expected to join them in 2019,” says the report. “With expanding legalization came new business opportunities, and the gaming industry’s previously strained relationship with professional sports leagues began to thaw: more than two dozen business partnerships were signed in 2018 between professional sports teams and leagues and gaming operators and suppliers.”
Miller added, “More people than ever are experiencing the economic and social benefits of gaming in their communities, due in part to the expansion of legal sports betting across the country.”
At the same time commercial gaming added another state when “voters in Arkansas approved a constitutional amendment, making it the 25th state to legalize commercial casino gaming (and the 41st state overall with legal casino gaming, including tribal casino operations).”
The reported added, “AGA also helped inform state legislatures considering sports betting legislation, emphasizing that the right policies are critical to the success of a legal marketplace. As a result, states unanimously rejected harmful policies such as league royalties and official data mandates. Further, AGA advocacy efforts helped spark regulatory reforms in Louisiana and Ohio that simplify and streamline shipping of gaming equipment, resulting in greater efficiencies for manufacturers, operators and regulators.”
As a result, sports betting grew to $430.2 million in 2018, up from $261.3 million the year before. The AGA anticipates that this ramping up will continue as more states join the sports book bandwagon.
The report also noted that commercial gaming paid a record $9.7 billion taxes to local and state governments. But it points out: “Notably, the $9.71 billion figure—a record haul and an increase of 3.1 percent over 2017—reflects only specific state and local taxes that are applied directly to gaming activities. It does not include the billions more paid by the industry in the form of income, sales and various other corporate taxes, nor does the total reflect payroll taxes paid by gaming operators and suppliers.”
The casinos in Colorado’s three casino towns, Black Hawk, Central City and Cripple Creek, took in a record $842 million according to the AGA report.
That was a 1.7 percent increase over the previous year’s total of $828 million, and a whopping 13 percent jump since 2014. Colorado joins about a dozen states–half of the states that have commercial casinos—that experienced similar results. It was in 11th place in the top dozen.
The mountain towns could rake in even more in the future if voters in November authorize them to offer sports betting. Legalized sports betting last year was something that the “State of the States” report attributed to the overall rise in profits nationally.
The ballot measure, if passed, would tax sports betting at 10 percent. The legislature has already passed a regulatory framework that would allow sports betting at brick and mortar properties and on mobile platforms if the voters approve.
The sponsor of that bill, House Majority Leader Alex Garnett declared last month, “Coloradans should have the option of betting on the Nuggets in the playoffs or the Avalanche in the Stanley Cup.”
Maine’s two casinos brought in almost $144 million in 2018, setting a record. That amount was a 5 percent increase over the previous year.
It joins 11 other states with commercial gaming that set records, a feat that was listed in AGA report.
The 5 percent increase is related to new hotel that opened at Oxford Casino and the expansion of the gaming floor there. The state’s Gaming Control Unit Executive Director Milt Champion, says that will probably be a fleeting advantage that will be blunted by the opening of new casinos in Boston and Springfield, Massachusetts.
Champion told the Times-Record, “I don’t think we will continue to see the increases. There is only so much discretionary money, pretty soon you will see the casinos do a little bit less because sports wagering will come on board.”
A bill to legalize sports betting has been proposed in the legislative. Champion commented, “Maine has taken a very realistic look at any type of new gambling they are in the process of allowing I think Maine is in a very good position and I think it is a model state, not just someplace to look at as a little state in the right-hand corner.”
The bill would allow persons over 21 to bet at the two casinos, at racetracks, and at OTB parlors. It doesn’t include a mobile platform element.
The two casinos paid the state $58 million in taxes.
Although the state has two casinos, the Oxford Casino easily accounted for the lion’s share, bringing in nearly $57 million, compared to $32.8 million for the Hollywood Casino in Bangor.
The report can be downloaded at the AGA website, americangaming.org.
