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Bits and Pieces from Indian Country - September 2006
12 November 2006
By Ken Adams
Washington is an interesting state for gambling. Long thought by gaming observers
to be a conservative, almost anti-gambling state, it has proven on closer examination
to be very much a pro-gambling state. Even before Indian gaming, gambling was
big in Washington. The total revenues from the lottery, charitable bingo, and
pull tabs were over a billion dollars. Washington was also one of the four most
important sources of tourism and gambling dollars for northern Nevada. The tribes
in Washington were ahead of most states in compacting with the state to operate
casinos; the Tulalip Tribes signed the first compact in 1991.
With each new generation of Indian gaming, state and local legislators tried
to find ways to “level the playing field” for the non-Indian operations.
Over time most of those efforts have failed, mostly because the tribes even
with the efforts of the legislators have managed to stay ahead of competition
with the types of gaming, number of games, and limits that they can offer. There
are other issues that contribute to the situation and the gradual decline of
non-Indian forms of gaming. The obvious one is taxation; local operators pay
a tax that the tribes do not pay. Another issue, one that is beginning to play
itself out in other states as well, is anti-smoking legislation. Washington
has banned smoking in all public places, but cannot ban it in Indian casinos.
That certainly tips the balance even further in favor of the tribes.
Representatives from three of the seven house-banked card rooms currently
operating in Spokane County say competition from Northern Quest, anti-smoking
regulations, and taxes assessed by local government entities are making it
difficult to stay in business. Nontribal gaming operations are having a tough
time surviving in Spokane County because of a mix of regulatory and competitive
pressures, industry representatives say. Four casinos have shut down over
the last five years and others are struggling to turn a profit, raising the
specter of other closures as well. At the same time, the nearest tribal casino,
Northern Quest Casino, in Airway Heights, steadily has expanded its operations.
It now has 1,200 employees, 1,225 electronic games, and 39 gaming tables…Like
a bell curve, the number of licensed house-banked card rooms in Spokane County
rose annually from 1997 until 2000, and has since dropped off. It was 1997
when the state of Washington legalized house-banked card rooms, and December
2000 when Northern Quest Casino, owned by the Kalispel Tribe of Indians, entered
the local gambling market…The number of such card rooms that report
their revenues to the state grew here from six in 1997 to 11 in 2000, and
was reported at eight in mid-May by the Washington state Gambling Commission.
Since then, Bluz at the Bend, at 2721 N. Market, has closed its gambling operations.
Rocky Wilson, Spokane Journal of Business, 8-18-06
The tribes have been responsible and productive citizens of the state even
if they have not paid taxes directly on their gaming revenue. Besides the people
employed by the casinos, the tribes buy their supplies from the local community,
and by compact contribute approximately 2 percent of their table revenue to
local charities. And as the casinos’ profits substantially improve the
living situation on reservations where the standard of living prior to Indian
gaming was significantly below the rest of the state, the tribes are diversifying
and creating other businesses that also make important contributions to the
local economy.
Washington's 29 tribal governments are creating new economic opportunities
on Indian reservations and in nearby communities, and are generating tens
of millions of dollars in local and state taxes, according to a leading national
economist who has just completed a major, two-year-long profile of the state's
Indian economy…Tribal governments "are building, buying, selling,
hiring and investing like never before," reports Jonathan Taylor, an
independent economic consultant based in Cambridge, Mass… The total
value-added, multiplier effect of tribal government and enterprise spending
within Washington exceeds about $2.2 billion a year. Taylor calculates that
sum yields an estimated $141 million in state and local taxes in Washington…
For generations, there were few opportunities for employment on reservations.
Because reservation land is held by the federal government in trust for tribes,
it was difficult or impossible to attract private investment for economic
development. Tribal government gaming is the first economic development tool
that has been successful on Indian reservations across Washington and revenue
from it is being to finance other investments. Ron Allen, Seattle Post-Intelligencer,
8-14-06
If Indian gaming in Washington, with just 29 tribes and 33 casinos, is that
important, just how important is Indian gaming in California, with over 56 casinos
and close to 60,000 slot machines? Important enough for Governor Schwarzenegger,
when he took office, to base part of his proposed financial turn-around on revenues
from tribal casinos. He didn’t quite get what he predicted – in
fact he has not managed to get much yet. But therein, as the famous bard said,
lies the tale. Arnold has been back at the bargaining table, willing this time
to grant some significant concessions, while at the same time not tolerating
any attempt by tribes to make an end run around him and operate any “gray”
games at all. He made significant progress in August, announcing within a week,
six new agreements that would gain the state billions of dollars over time and
permit nearly another 25,000 slot machines.
Unfortunately for the governor and the tribes, the “guys” in Sacramento
have the final say and they won’t. Won’t what? Won’t say –
anything, except that they were annoyed by the timing and didn’t like
the labor component of the agreements.
Schwarzenegger signs deals with tribes for more slot machines; the announcement
came just a day after the state Assembly rejected a similar deal between the
governor and the Agua Caliente Band of Cahuilla Indians in Palm Springs. Deals
announced Tuesday by Gov. Arnold Schwarzenegger would allow two of California's
richest Indian tribes to vastly expand the number of slot machines in their
casinos in return for paying billions of dollars to the state. Robert Jablon,
Associated Press, 8-28-06
Unless the Legislature acts quickly, by Thursday, Big Lagoon Rancheria's
gaming compact will be about as profitable as snake eyes on the craps table.
The much-debated compact, signed with Gov. Arnold Schwarzenegger on Sept.
9, 2005, would allow the Big Lagoon Rancheria to own and operate a casino
in Barstow, some 700 miles away from the Rancheria's North Coast trust lands.
Jessie Faulkner Eureka Times-Standard, 8-30-06
Democrats on Thursday blocked new compacts that Gov. Arnold Schwarzenegger
negotiated with five of the state's richest casino tribes, stalling action
on more than 22,000 new slot machines until next year. Democratic leaders
refused to vote on one bill ratifying the agreements, saying the governor
sent details of the compacts too late for proper scrutiny before the end of
the legislative session at midnight Thursday. Assembly Democrats defeated
a second bill that would have granted a third casino to the Agua Caliente
tribe in Palm Springs. Clea Benson, Sacramento Bee, 9-1-06
The failure of the compacts to get legislative endorsement does not necessarily
mean they are dead; it just means that for this year, if not dead, they are
in a coma. Just as gaming is gaining more prominence in elections in many states,
Indian gaming is a significant political issue in those states with Indian gaming.
In Washington and Oklahoma, there are Indians serving as representatives in
the state legislature. The tribes have money and they spend it in their best
interests and that includes electing people who are sympathetic to their cause.
We can expect more tribal members to be elected and eventually to have them
also serving in Washington, D.C.
Gaming is part of our culture, and it is becoming more of a factor in politics,
not in the backroom way of Jack Abramoff and his associates, but in the “up
front at the ballot box way” that is at the heart of American politics.
Abramoff hurt gaming, and he hurt Indian gaming, but the Abramoff effect as
it is being called will eventually pass. We don’t need another of his
ilk, but we do need representation.
Gaming needs incumbent and prospective elective officials who are willing to
stand up and represent gaming openly. The industry needs to get over its embarrassment
and unwillingness to stand in the spotlight and make its case. Gaming pays billions
of dollars in taxes and contributes billions more in other expenses and ancillary
industries; gaming employs hundreds of thousands of people. In New Jersey the
casino workers are being wooed as a block to express, at the polls, their dissatisfaction
with the politicians who allowed the casinos to close, which caused the workers
to lose wages, benefits, and tips. Every state with gaming casino employees
should be encouraged to vote to support their industry, just as autoworkers,
steelworkers, and members of other unions vote to support their industries and
jobs.
Gaming may be vulnerable to the uncertainties of politics, but it would be
less so if all of its employees, investors, and other beneficiaries voted for
its best interests.
But now, that is simply my opinion, isn’t it?
Ken
Recent Articles
Best of 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.
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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.
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