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Best of Ken Adams

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Bits and Pieces from Indian Country - July 2008

1 August 2008

Indian gaming numbers for 2007 were released by the National Indian Gaming Commission. Indian gaming is still growing, although the growth has slowed to 5 percent. The Indian Gaming Regulatory Act is twenty years old this year and revenues have grown from $200 million to $26 billion. It isn't likely that anyone who voted for the act in 1988 could have predicted its success; it isn't even likely any one of those congressmen and women would even believe today's Indian gaming. The Seminole Tribe of Florida owns the Hard Rock franchise; the two Connecticut tribes have or are in the process of developing casinos in many jurisdictions across the country. The Oneida Tribe of New York and Oneida Tribe of Wisconsin have built very successful broad-based economies. The Tulalip Tribes of Washington have gone from leasing a few acres of land to Boeing to operating casinos, hotels, and their own incorporated village with industrial and major retail development. The examples are almost endless, but they all share one characteristic: as soon as there is enough free cash to pay for the major needs of tribal members, those needs become the top priority. And once those needs are being met, excess cash is used to develop new businesses both on and off tribal land. I know of no other single piece of federal legislation that has been so successful.

Philip N. Hogen, Chairman of the National Indian Gaming Commission (NIGC), announced today that net revenues from Indian gaming continue to grow, increasing 5% from 2006 and generating $26 billion in revenues in 2007. "The continued growth is significant considering recent economic struggles throughout the country. Indian gaming continues to be an important factor in local economies by providing much needed jobs throughout Indian country and other economic development," Hogen said. "The Indian gaming industry has experienced tremendous growth since the inception of the Indian Gaming Regulatory Act (IGRA) twenty years ago in 1988 when the Indian gaming industry saw revenues of $200 million, to now over $26 billion in 2007." NIGC Region V, which includes Kansas, Oklahoma and Texas, had the largest percentage increase in revenues. The region generated revenues of $2.6 billion in 2007, a 20% increase from the $2.1 billion generated in 2006. The region has experienced active growth, more than doubling revenues in the three-year period from 2004 to 2007, climbing from 83 operations generating $1.3 billion in 2004 to 100 operations generating $2.6 billion in 2007. Region II, consisting of California and northern Nevada, had only a 1.6% increase in revenue but still saw the biggest revenues of NIGC's six regions, increasing to $7.8 billion in 2007 from $7.7 billion in 2006. (Official Press Release, 6-18-08)

Everything isn't all roses in Indian gaming, any more than in gaming in general. The economy is affecting many Indian gaming operations in the same way it is affecting gaming operations in Las Vegas or Atlantic City. And the casinos are responding in the same way also, by cutting expenses, including employees.

Foxwoods Resort Casino on Thursday issued layoff notices to slightly fewer than 200 employees, effective immediately. The cuts comprise less than 2 percent of the casino's 10,000-member work force. Most positions that were cut were managerial, but a few hourly positions were affected, tribal spokeswoman Lori Potter said. (Kira Goldenberg, New London Day, 6-27-08)

Approximately 70 employees of the Colorado River Indian Tribes' BlueWater Resort & Casino were told May 30 by acting general manager Bill Beeson they were laid off. A prepared statement handed out to the newly laid off employees stated the "staff reduction ... is necessary due to the declining economy and reduced patron counts at the BlueWater…The combined impact of an economic downturn and higher gas prices are being felt throughout the gaming industry, including at the BlueWater Resort & Casino. The high gas prices add to the downturn, which particularly affect "destination" gaming sites such as the BlueWater, which relies heavily on people driving in from southern California and from the Phoenix area." (Joan M. Travis, Parker Pioneer, 6-13-08)

Gaming is in the midst of some very difficult times. Gaming stocks are down, and revenues are declining as customers struggle to adjust to higher gas and other prices that are squeezing the disposable income of gamblers and everyone else. These factors are forcing casinos to tighten their belts too. This is also increasing competitive pressures, and casinos are spending more on marketing and promotions. Ultimately profits are reduced even further, making it even more difficult for the weakest to survive. It is an axiom in biology that only the fittest survive. It is just as true for businesses, at least during difficult times, and, as I said, these are indeed difficult times for gaming.

But now, that is simply my opinion, isn't it?

Ken

Ken Adams

Ken Adams is the principal in the gaming consulting firm, Ken Adams and Associates. Formed in 1990, Ken Adams and Associates specializes in information, analysis, and strategic planning for Indian tribes, casino operations and gaming manufacturers.

Ken spent over 20 years in the hotel-casino industry, prior to founding Ken Adams and Associates. He held the positions of: Director of Casino Operations, Casino Manager, and Keno Department Manager. During this time, he developed numerous innovative marketing and customer development programs and systems for evaluating casino performance. Some of those programs, such as slot clubs and tournaments, have become industry standards.

Ken is also actively involved in gathering and disseminating information that is important to the gaming industry. He is editor and publisher of and the Adams' Report, a monthly newsletter specializing in identifying trends in casino gaming, regulation and manufacturing, the Adams Daily Report, an electronic newsletter that provides electronic links to the key gaming stories of the day, and the Adams Review, a special report distributed by Compton Dancer Consulting that provides editorial commentary on gaming trends.
Ken Adams
Ken Adams is the principal in the gaming consulting firm, Ken Adams and Associates. Formed in 1990, Ken Adams and Associates specializes in information, analysis, and strategic planning for Indian tribes, casino operations and gaming manufacturers.

Ken spent over 20 years in the hotel-casino industry, prior to founding Ken Adams and Associates. He held the positions of: Director of Casino Operations, Casino Manager, and Keno Department Manager. During this time, he developed numerous innovative marketing and customer development programs and systems for evaluating casino performance. Some of those programs, such as slot clubs and tournaments, have become industry standards.

Ken is also actively involved in gathering and disseminating information that is important to the gaming industry. He is editor and publisher of and the Adams' Report, a monthly newsletter specializing in identifying trends in casino gaming, regulation and manufacturing, the Adams Daily Report, an electronic newsletter that provides electronic links to the key gaming stories of the day, and the Adams Review, a special report distributed by Compton Dancer Consulting that provides editorial commentary on gaming trends.