Casino City’s Indian Gaming Business Report 11 Executive Summary Indian gaming experienced solid growth on a nationwide basis in calendar year 2017. The 4.3% growth of gaming revenue was stronger than the 3.9% growth in 2016. It was the eighth straight year of growth following the Great Recession, leading to a new all-time high of $32.8 billion in gaming revenue in 2017. Non-gaming amenities continued to expand at a strong pace at many Indian gaming facilities. In 2017, non-gaming revenues grew an estimated 10% to an all-time high of $5.4 billion. Altogether, the $38.2 billion in gaming and nongaming revenues in 2017 were generated by 248 tribes operating nearly 362,000 gaming machines and 7,700 table games in 500 gaming facilities in 28 states. Indian gaming’s growth in 2017 was in large part the result of growth of the general economy. U.S. gross domestic product (GDP) grew 2.2% in 2017, faster than the 1.5% growth in 2016 and U.S. per capita disposable personal income (DPI) grew 4.7% in 2017, faster than the 2.8% growth in 2016. Digging in deeper at the state level, gross state product (GSP) increased in every state and 2017 growth was at a faster pace in 32 of them. Meanwhile, state-level per capita disposable personal income (DPI) also increased in all states and at a faster pace in 48 of them. Although Indian gaming’s pattern of faster growth generally followed suit with the national and state economies, 2017 was the third consecutive year that Indian gaming’s growth outpaced that of the U.S. economy. Indian gaming also outperformed other casino gaming segments to maintain its role as the largest industry segment. The traditional commercial casino segment grew 2.9% to $30.9 billion and the racetrack casino (“racino”) segment grew 0.3% to $8.7 billion. These growth rates were stronger in the commercial casino segment and weaker for racinos than those in 2016 (0.7% and 1.6%, respectively). Indian gaming now represents approximately 45.4% of the nationwide casino gaming market, compared to 42.6% for the commercial casino segment and 12% for the racino segment. The only segment to outgrow Indian gaming in 2017 was card rooms with 7.8%. There was some disparity in the performance of Indian gaming across gaming facilities, tribes and states, varying from approximately +8.1% in Washington to +.3% in Louisiana. Indian gaming grew across all states in which it existed. The top 10 fastest growing Indian gaming states were (high to low): Washington, Texas, California, Alabama, Idaho, Arizona, Oregon, Oklahoma, Colorado and Minnesota. In 2017, the largest Indian gaming state in terms of gaming revenue continued to be California, nearly double the size of the next largest state, Oklahoma. California alone accounted for 27.4% of total nationwide gaming revenue for Indian gaming. It was by far the leading driver of overall nationwide gaming revenue growth in 2017 given its sheer size and significant growth (contributed to 43.9% of total nationwide Indian gaming growth). Its 7% growth was slightly higher than in 2016 (6.3%) and so continued to remain above its pre-recession level. This growth also pushed California Indian gaming to a new all-time high of $9 billion in gaming revenue. Gaming revenue continued to be highly concentrated among the largest Indian gaming states. The top two states, California and Oklahoma, generated a combined 41.2% of gaming revenue. Adding Washington, Florida and Arizona puts the top five states at 63.4% of total gaming revenue. The top 10 states, which included Connecticut, Minnesota, Michigan, Wisconsin and New York, generated 84.5% of total gaming revenue. That leaves 18 other states combining to equal only 15.5% of total nationwide Indian gaming revenue. Gaming revenue also continued to be highly concentrated among a small number of very large Indian gaming facilities. In 2017, the top 6.7% of all Indian gaming facilities, which each generated $250 million or more, accounted for 46.3% of total gaming revenue nationwide.
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