Like Wisconsin’s 10 other federally recognized tribal nations, the Ho-Chunk Nation in Wisconsin is taking another look at its dependence on casino gaming, following the impact of the Covid-19 pandemic. Temporary shutdowns, layoffs, service cuts and more left many tribes reeling, Ho-Chunk included.
Ho-Chunk President Marlon WhiteEagle said, “We were hit pretty hard by the pandemic. And that begs the question of what we can do to move beyond gaming.” The tribe owns six casinos; the three largest are in Madison, Wisconsin Dells and Black River Falls. WhiteEagle said gaming typically makes up 75 percent of the tribe’s revenue.
WhiteEagle admits tribal officials have become complacent since gambling changed the tribal way of life in the 1980s. Diversification−including future development on Ho-Chunk land held in federal trust plus federal contracting and entrepreneurship−could make a difference. White Eagle said, “It takes courage to fail. And we’ve made a lot of courageous efforts. But obviously we need to get back on the horse and keep trying.”
When Covid-19 hit in spring 2020, the state’s tribal casinos’ annual net winnings, previously $1.3 billion, dropped to $893 million. The portion Wisconsin receives under tribal gaming compacts decreased by more than 99 percent between the 2019 and 2021 fiscal years, from $29.1 million to $154,000, according to state records. All revenue sources, including gaming and state and federal grants, brought Ho-Chunk around $500 million before the pandemic.
The pandemic caused about 2,250 Ho-Chunk employees to be laid off, representing more than 80 percent of the tribe’s gaming workforce. WhiteEagle announced the layoffs in a YouTube message to tribal citizens, triggering negative reactions and an effort to remove him from office.
Gaming revenue today makes up three-quarters of the tribe’s revenue, WhiteEagle said. Ho-Chunk is planning to break ground on a $405 million casino complex in Beloit, which still requires approval from the federal Bureau of Indian Affairs. He noted plans include a property that could be used for an education center or healthcare facility if gambling increasingly moves online and brick-and-mortar casinos become a “thing of the past,” said Ryan Greendeer, spokesman for the Ho-Chunk legislature. WhiteEagle said he’s hopeful sports betting is “on the horizon” for the tribe.
Some Wisconsin tribes have renegotiated their gaming compacts to allow sports betting sites. Most other forms of online gambling are prohibited. In the meantime, said Patrice Kunesh, founder and former director at the Center for Indian Country Development at the Federal Reserve Bank of Minneapolis, the long-term profitability of brick-and-mortar casinos isn’t a given. Ho-Chunk Gaming Business Development Manager Jon Warner said it’s critical for tribes to seek opportunities beyond gambling. “Right now, our baby boomers are there. They’re the sustainable market. We’re fairly confident that we’ve got 20, 30 years of brick-and-mortar casino profits for us. After that, it’s going to change,” Warner said.
Outside of gaming, the tribe owns and operates five convenience stores, which provided revenue when the casinos temporarily closed. The tribe also operates three hotels and the Ho-Chunk RV Resort and Campground near Wisconsin Dells.
WhiteEagle noted some past attempts at diversification have not succeeded. For example, in 2003, the tribe introduced a bottled water brand but was unable to break into new markets. The same year, the tribe opened a $3 million cinema in Tomah that has not reopened since it closed due to Covid-19.
One promising industry is industrial hemp, said tribal attorney Samantha Skenandore. “Tribal nations are just really good at regulating the sins of the world, like gaming, tobacco, cannabis, all of these industries the government can’t handle the political pressure of regulating.” Also, restarting a small business loan program could encourage entrepreneurship.
Another real money-making possibility is for Ho-Chunk to offer its 6,633 acres of trust land for commercial use. WhiteEagle said, “We could attract large corporations that contribute to our tribal economy through taxes or fees.”
Still, the success of gaming continues to delay diversification, WhiteEagle said, noting other ventures simply cannot dependably generate 15 percent to 20 percent profit margins. “When we see anything less profitable, there’s a thought of, ‘Is it worth it?’ And then it stalls out,” WhiteEagle said.
