NEW LONDON, Conn. — Foxwoods Resort Casino and Mohegan Sun generated $2.1 billion in revenues in the 2010 calendar year, a decline of about 4 percent over the $2.2 billion they generated the previous year, according to a new report.
The findings are contained in the 10th edition of the Indian Gaming Industry Report, which was authored by Alan Meister, an economist with Nathan Associates Inc.
For Connecticut’s casinos, 2010 — the most recent year for which data are available — marked the third straight year of decline. Foxwoods’ and Mohegan Sun’s combined revenues fell by 7 percent in 2009 and by 5 percent in 2008, the report says.
“While the decrease in 2010 is due in part to the downturn in the economy, it is also the result of increased competition in the Northeastern U.S. gaming market, namely commercial casinos and racinos in Pennsylvania, Indian casinos and racinos in New York, commercial casinos in Atlantic City, and racinos in Maine and Rhode Island,” according to the report.
The decline runs slightly counter to the overall picture the report paints of Indian gaming in the United States, which in 2010 generated $267 billion in gaming revenue and $3.2 billion in nongaming revenue. The total was up more than 1 percent after declining for the first time in 2009.
The report cites several future developments that could affect the Connecticut casinos, including Mohegan Sun’s long-standing plan to add a new hotel and Foxwoods’ plans, recently disclosed, to develop a mall linking Foxwoods Resort Casino and MGM Grand at Foxwoods as well as to build a restaurant, convenience store and gas station near the casino.
Competition from casinos that have been authorized but not yet licensed in Massachusetts is at least a few years away, the report says.
Indian gaming’s 2010 performance outstripped that of commercial casinos, which reported a 0.1 percent decline, according to the report.
In 2010, Indian gaming generated about 44 percent of all U.S. casino gaming revenue. Commercial casinos accounted for 45 percent and racinos 11 percent.
“However,” the report says, “Indian gaming continued to gain ground and is poised to overtake the commercial casino segment in the near future.”
As the report points out, Indian gaming revenues continue to be fragmented, with 239 tribes operating 448 gaming facilities in 28 states. However, California tribes generated more than 25 percent of the total revenue. California and Oklahoma, the top two states, generated a combined 38 percent.
The top five states, which also include Connecticut, Florida and Washington, accounted for 61 percent of the Indian gaming revenue in 2010.
According to the report, the Great Recession that struck at the end of 2007 slowed the growth of Indian gaming considerably, shrinking consumers’ disposable incomes and causing a credit crunch that limited tribes’ ability to renovate and expand their facilities.
But, the report says, Indian gaming’s slowdown had begun as early as 2005. Possible explanations include the “maturation” of Indian gaming as a whole and, in some markets, saturation. State and federal policies aimed at regulating Indian gaming have also had “a dampening effect” on the industry, the report says.
(c) 2012 The Day (New London, Conn.)
Distributed by MCT Information Services