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But unlike the Strip, Indian casinos enjoyed a slight boost in gaming revenues compared with prior years, although, the increase was not the double-digit jump that tribal casinos experienced between 1993 and 2006.
According to the Indian Gaming Industry Report, authored by economist Alan Meister of Nathan Associates, tribal casinos in 28 states collected $26.8 billion in gaming revenue in 2008, a 1.5 percent increase compared with $26.4 billion.
A year earlier, as the nation's economy began to slide, gaming revenues at Indian casinos grew 4.5 percent. But that compared to a 13-year run when the annual gaming revenues produced by Indian casinos averaged 20.3 percent annual growth during the time of tremendous expansion by tribal gaming.
Meister said Indian gaming has expanded in some states, such as Oklahoma, while other states, such as California, saw gaming revenues decline because of the economy.
"One of the observations we've seen is that while the number of visits are not down, spending has declined," Meister said. "That seems to be a general feeling for the gaming industry as a whole."
In 2008, there were 442 tribal casinos nationwide, a 3 percent increase over 2007, operating 321,079 slot machines and 8,097 table games.
Publisher Casino City Press is releasing the report today, which breaks down tribal gaming results nationally and by individual states.
Indian gaming has proven not to be recession-proof. In addition to reduced spending by consumers, many tribal casinos were forced to lay off workers and downsize development projects because of the slowing economy. Consumer spending on nongaming amenities grew 3 percent, but below the 8 percent jump a year earlier.
"Some of the casinos located in local markets have done OK," Meister said. "But the facilities where it's a distance to travel might be hurt a little bit more."
In comparison to Indian gaming as a whole, Strip casinos saw gaming revenues decline 10.6 percent in 2008 and are down 12.5 percent in the first nine months of 2009.
Many analysts believe Nevada gaming jurisdictions, such as Primm and the Reno-Lake Tahoe markets, have been hurt by the growth of Indian casinos in California.
However, the state, which added three casinos in 2008 to give it 65 total, saw gaming revenues decline nearly 6 percent, to $7.3 billion, compared with $7.8 billion in 2007. In previous years, gaming revenues in California grew 9 percent in 2006 and 1 percent in 2007.
Still, California casinos accounted for more than 27 percent of all the Indian gaming revenues produced nationally, the highest of any state.
Meister said the economy was the biggest factor in California's decline, but he also blamed the state's restriction on the number of slot machines allowed inside Indian casinos as another reason for the slower growth.
However, a court ruling could allow 10,549 new slot machines to be added at 10 tribal casinos, adding to the 67,672 games already in use in California, the highest figure among the 28 states with Indian gaming.
Also, the report cited 11 current or potential tribal casino expansions or renovations and 24 proposed new casinos in the state.
While California posted a decline, Indian casinos in Oklahoma more than made up for the losses.
The state passed Connecticut as the second largest Indian gaming revenue-producing state with $2.9 billion, an 18 percent increase. Oklahoma has the most tribal casinos in the nation, 110, which includes travel centers, smoke shops and retail centers that have gaming.
The biggest reason for the growth was the addition of Las Vegas-style slot machines and many casinos adding table games. Also, a growing number of Indian casinos in Oklahoma have built nongaming amenities, such as hotels, restaurants and entertainment venues.
The expansion in Oklahoma has attracted customers from neighboring Texas, which does not have casinos.
"The full-scale casinos have made the quality of the gaming experience better," Meister said. "Plus, casinos in Oklahoma are closer than other options, such as Louisiana."
California and Oklahoma generated 38 percent of the total Indian gaming revenue made nationwide. Also, the top five states -- California, Oklahoma, Connecticut, Arizona and Florida -- accounted for 61 percent of the nation's Indian gaming revenue.
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