Casino tax revenue at 8-year low: Commission
BY KAREN CAFFARINI Post-Tribune correspondent January 15, 2014 12:54PM
Ameristar Casino. | Sun-Times Media File
The win comprises the wagering dollars retained by the casinos after prize amounts have been paid to winning players.
Blue Chip $167,915,736
Majestic Star I $104,238,856
Majestic Star II $85,193,725
Updated: February 18, 2014 6:03AM
Indiana’s casino industry saw its combined wagering and admissions taxes drop to its lowest level in eight years in 2013 and its 12,900 employees were the fewest since 1998, according to a year-end report released by the Indiana Gaming Commission.
On the bright side: Indiana still ranks third in the nation in tax revenue generated by gaming; several of its casinos, including Ameristar in East Chicago, are making capital expenditures; and casino observers are predicting 2014 to be a year of stabilization, Ernest Yelton, executive director of the gaming commission wrote in his report.
Ameristar made improvements to its parking garage last year.
According to the report, the total win from all Indiana gaming enterprises was almost $2.5 billion in 2013, a 7.6 percent drop from 2012. Wagering taxes dropped 9 percent and admissions were down 11 percent. The total taxes were $752.4 million.
“Three quarters of a billion dollars is still a handsome sum,” Yelton wrote of the taxes generated.
Yelton called the lower number “a new normal” for the state, a result of growing competition from abutting states and a slowly recovering economy.
Yelton did not return several phone calls seeking further comment on the findings.
Matt Schuffert, vice president and general manager of Ameristar Casino in East Chicago, said the struggling economy was not the only factor negatively impacting casinos in the region. The closure of Cline Avenue bridge also had an adverse effect on Ameristar.
Indiana gaming analyst Ed Feigenbaum isn’t so sure the industry will stabilize in 2014. He also pointed out that some job losses through the years were due to changes in technology, not the economy and competition, and will never come back.
“Casinos no longer have slot attendants. That’s a significant number of people,” Feigenbaum said.
Still, casinos continue to hire. Schuffert said Ameristar is actively recruiting for to hire 40 more people.
Feigenbaum said for Northwest Indiana, there still are too many variables across the border in Illinois to say whether the industry will stabilize here.
“We still haven’t seen the full effect of video lottery terminals in Illinois. For people looking to spend a little bit of money at Indiana casinos on penny slot machines, this may be an alternative to them that’s closer to home,” Feigenbaum said.
He also didn’t know if Illinois would change its no-smoking law for casinos, expand its horse racing industry or allow more casinos, particularly in the South Suburbs and Chicago, which could be especially detrimental to Northwest Indiana casinos.
Matt Schuffert, vice president and general manager of Ameristar Casino in East Chicago, remains hopeful the economy and the casino industry will turn around in 2014.
He said the casino will continue to offer promotions and giveaways.
Feigenbaum said to rise above the competition and economic factors, casinos must look at their demographics and cater to that specific niche to stand out from competitors.
“It could be entertainment, restaurants, sports bars or a hotel that you could focus on,” Feigenbaum said.
He pointed out, for instance, that the casinos with hotels were able to stay open during recent snowstorms, while Horseshoe in Hammond, the sole casino without a hotel, closed for one day.