NWI casino revenues drop for second year in row

2013-01-08T16:00:00Z 2013-01-10T00:37:05Z NWI casino revenues drop for second year in rowKeith Benman keith.benman@nwi.com, (219) 933-3326 nwitimes.com
January 08, 2013 4:00 pm  • 

Revenues at Northwest Indiana's five casinos dropped by $24.3 million in 2012, the second straight year of decline with the state of Indiana predicting more declines ahead.

The five Northwest Indiana casinos raked in $1.11 billion total in 2012, as compared to $1.13 billion in 2011, for a 2.1 percent drop overall, according to a tally by The Times of Indiana Gaming Commission monthly revenue reports. That drop compares with a 5.5 percent drop statewide in 2011.

The drops in casinos' total take affects state, county and city revenues, as well as employment at the casinos themselves.

"It's never going to be the kind of gravy train we saw as recently as six years ago," said Ed Feigenbaum, editor of Indiana Gaming Insight, after release of the gaming commission's December casino revenue report on Tuesday.

Statewide, gaming revenues were down by a total of $47.6 million, or 1.7 percent, according to an Indiana Gaming Insight tally.

The latest state revenue forecast projects Indiana tax receipts from casinos will decline over the next two budget years by $41.4 million, a 9 percent drop, due to competition from new casinos in Ohio. That is more than $100 million less than revenues just four years ago.

In Northwest Indiana for 2012, Majestic Star II Casino in Gary sustained the largest overall percentage drop in revenues, with its total take down 3.9 percent. Blue Chip was the only casino in Northwest Indiana to eke out a gain, with revenues up 1.3 percent for the year.

Horseshoe remained unrivaled as the casino with the largest overall revenue haul, taking in $498.4 million for the year. Though revenues there declined by 2.2 percent in 2012, Horseshoe ended the year on an up note, with December revenues increasing 2.2 percent as compared to December 2011.

Horseshoe General Manager Dan Nita remains concerned about movements afoot in the Indiana General Assembly for land-based casinos, with city of Gary officials pushing for one in their city.

"The No. 1 thing they should always consider: Anything they do needs to benefit all the operators in the state," Nita said. "They shouldn't prefer one community over another."

Addressing the problem of declining casino revenues is a ticklish one for state legislators, Feigenbaum said. They could reduce taxes on casinos in hopes of making them more competitive, but the immediate effect would probably be a further reduction in revenue.

Or legislators could go for "game-changer" solution, such as land-based casinos, Feigenbaum said. But that inevitably would benefit one casino operator and community at the expense of others.

But it will be even clearer something has to be done when a new Horseshoe Casino opens in Cincinnati in a couple of months, affecting at least three southern Indiana casinos, Feigenbaum said. In addition, casinos in Michigan like Firekeepers continue to make improvements, affecting the Northwest Indiana market.

At Northwest Indiana's five gaming boats in December, an overall 1 percent decline in revenues continued a 2012 trend that saw revenues drop in nine out of the year's 12 months.

The five casinos raked in a total of $91.9 million in December, as compared to $92.9 million in December 2011, according to the Indiana Gaming Commission's monthly revenue report.

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