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New Mexico's Indian casino revenues were still growing throughout 2005, but not as quickly as they had in previous years, according to a recent report.
The Indian Gaming Industry Report by Alan Meister, an independent economist who studies the gaming industry, lists New Mexico as having Indian gaming revenues of $646 million in 2005. That's a four-percent increase from 2004, when the state's Indian casinos brought in $623.9 million, according to Meister's research. As a result, in 2005 New Mexico moved from 12th to 11th in terms of statewide Indian gaming revenues, out of the 20 states with Indian gaming operations listed in the report. The rankings do not include other commercial gaming - New Mexico has none - or racinos, horse racing tracks with casinos attached.
According to the State of New Mexico Gaming Control Board, Indian gaming's slot machine revenues, after revenue sharing and regulatory fees, increased from $484 million in 2004 to $574 million in 2005, a 19 percent increase.
While Meister's report attempts to calculate all Indian casino gaming revenues, the state only tracks slot machine revenues, which are addressed in the tribes' compact with the state on revenue sharing.
According to Meister's data, New Mexico's gaming industry fared better in the years prior to 2005. The state's 2004 revenues were up 14 percent from 2003 revenues and up 26 percent over 2002's revenues. Gaming revenue data for the report was collected using state and local government agencies, tribes, gaming facilities, news sources and other publicly available studies.
There are currently 16 casinos in New Mexico operated by 13 tribes. There has only been one tribal-based casino opening in the last two years, the Apache Nugget Casino in 2004 by the Jicarilla Apache tribe. But more casino openings are planned by tribes such as the Nambe Pueblo in northern New Mexico, which approved plans for a 500-employee casino between Santa Fe and Espanola. The Navajo Nation, which recently approved gaming on reservation lands, is planning numerous casinos, including one near Shiprock.
Nationally, Indian casino revenues are rising considerably. In 2005, national Indian gaming revenues totaled $22.7 billion, a 16 percent increase from 2004 and a 25 percent increase from 2003.
But the data, when examined over decades, shows the gaming industry may be reaching a saturation point. Since 1996, the gaming industry has grown revenues an average of 15 percent per year, compared to a 72 percent annual growth rate between 1988 and 1995, due largely to more casinos being built during that time period, Meister says.
Today, more than 80 percent of the Indian gaming industry is concentrated among 10 states - New Mexico missed the list by one spot - with California and Connecticut accounting for 42 percent of the total national Indian gaming revenue in 2005.
Even with revenue rates in New Mexico rising modestly compared to previous years, the number of slot machines has increased from 12,323 in 2004 to 12,937 in 2005, a five percent increase. Table game operations have also increased almost 10 percent, from 260 in 2004 to 285 in 2005.
The report attributes some of the growth in New Mexico revenues to the rise in popularity of New Mexico's racinos. Between 2004 and 2005, racinos in the state increased their revenue by nearly 40 percent, from $150 million to $209 million. That same year, the state experienced the second highest gaming revenue growth in the nation and New York was the only state that ranked higher. Larry Waldman, chief economist at the Bureau of Business and Economic Research (BBER) at the University of New Mexico, says the growth can be explained by the 2004 opening of the Zia Park Race Track & Black Gold Casino in Hobbs, which reported about $53.7 million in slot revenue in 2005.
Waldman says racinos have become more popular as the horse racing industry has expanded. It has led to more spectators gambling on the slot machines and larger purses, with nearly $166 million bet on New Mexico racetracks in 2004, the most recent year for which the state has such data, Waldman reports.
Indian gaming, however, still provides the bulk of New Mexico's gambling revenues, outpacing racino revenues by nearly two-thirds. Waldman says the state earns eight percent of a casino's net slot winnings - $45 to $50 million annually after regulatory fees - as a result of revenue-sharing compacts with the Native American tribes that operate the casinos.
According to data obtained by the BBER, the state's five most profitable casinos are in the Albuquerque area, with Sandia Casino leading the pack with around $137 million in annual slot machine revenues. Sandia representative Amber Jordan says despite "bringing in the lion's share of casino profit" in the state, Sandia is working to improve the tribe's quality of life. But, she adds, "we still have a very long way to go."
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