Adding Up the 2010 Gaming Numbers

Indiana’s riverboats experienced slight admissions (0.4%) and revenue (1.27%) declines in 2010, according to a recently release report from RubinBrown, a St. Louis-based accounting and business consulting firm that specializes in the hospitality and gaming industry.

The company’s 52-page (the Indiana specifics are on Pages 22-25) Gaming Stats report takes an in-depth look at commerical casinos in five states — Missouri, Colorado, Illinois, Indiana and Iowa. It also examines tribal gaming in five states.

A few of the highlights:

  • In Indiana, Horseshoe in Hammond accounts for more than 23% of both admissions and statewide revenue. Next in both categories is Hollywood in Lawrenceburg — with 14% of admissions and 18% of revenues.
  • Missouri continues to lead in casino revenue growth, bringing in over $1.7 billion in revenue and more than $450 million in commercial gaming tax revenue in 2010.
  • Colorado, the only other state to see an increase in adjusted gross revenue, experienced an increase of $25 million during 2010 and generated more than $107 million in commercial gaming tax revenue. The passage of Amendment 50 by Colorado voters in 2009, which allowed the maximum bet at casinos to be raised from $5 to $100 and permitted properties to remain open 24 hours a day, can be attributed as one of the main causes for Colorado’s revenue increase in 2010.
  • Although AGR and admissions declined in 2010, 1.59 and 3.59 percent respectively, Iowa-based casinos saw patrons spending more per trip on average from the previous year.
  • Illinois, again, experienced the most marked drop in revenues among Midwestern states, with a statewide decrease of 4 percent for commercial gaming revenues. Also significant, Illinois riverboat gaming fell to its lowest levels in a decade and horse racing and lotteries remained flat. However, these revenues, according to Adams, may stabilize in late 2011 due to the opening of the Rivers Casino near Chicago’s O’Hare airport. The new facility is expected to generate $150 million in annual tax revenue and create over 1,000 permanent jobs in the Chicago area.

Hoosier Casinos Brace for Illinois Challengers

While much has been discussed about the competition Indiana casinos may face from newcomers in Ohio, Illinois gaming is also striving to compete. The Times of Northwest Indiana reports on how casinos in "the region" are preparing for competition from the Chicago area:

Illinois’ gambit to embark on a wholesale expansion of gambling with five new casinos, including one in Chicago and one in the south suburbs, is being carefully watched by those with a stake in the success of Northwest Indiana’s five casinos.

Hammond Mayor Thomas McDermott Jr. said he thinks a casino in the south suburbs would be more of a competitor for Horseshoe than a downtown Chicago casino. But anyone who wants to compete with the Hammond boat will have his work cut out for him.

"In reality, at the end of the day, even if we have a boat on the other side of the border, it will have to stack up against Horseshoe and that will not be easy to do," McDermott said.

Horseshoe is Indiana’s gaming heavyweight, with its annual revenues of more than $500 million per year accounting for about one-fifth of the state’s total gaming revenues.

Horseshoe generates more than $35 million in tax and revenue share for the city of Hammond, which has used the money to transform entire neighborhoods with new streets, sidewalks, sewers and even moderate-income housing.

The other Northwest Indiana casinos are Ameristar in East Chicago, Majestic Star I and Majestic Star II in Gary, and Blue Chip in Michigan City. In Illinois, Ford Heights has a powerful coalition working to land the south suburban gaming license.

South Shore Convention and Visitors Authority CEO Speros Batistatos agreed Horseshoe is well positioned to withstand any onslaught but said that is not the case with Northwest Indiana’s other casinos.

He said the Four Winds Casino Resort, which opened in 2007 in New Buffalo, Mich., has demonstrated the effect cross-border gaming can have on Northwest Indiana’s casinos.

However, Batistatos feels the real challenge to Northwest Indiana boats from Illinois would come from a downtown Chicago casino and not one in the south suburbs.

"You can say what you want about Hammond, East Chicago and Gary," Batistatos said. "But I don’t know anyone that is going to drive to Ford Heights, even if you plop Caesar’s Palace there."

Northwest Indiana casinos have been combating the competition from Michigan and Illinois with new facilities and improved amenities.