RubinBrown Gaming Stats 2018

TRIBAL GAMING

2017 GAMING REVENUES BY REGION ACCORDING TO RUBINBROWN'S ESTIMATE

In 2017, the tribal gaming industry segment generated an estimated $32.6 billion, growing at a rate of 4.6%. The continued growth marks the eighth consecutive year of growth for the segment. The growth experienced in 2017 is primarily attributed to improving economic conditions throughout the U.S., plus the continued expansion of resort amenities and services offered at existing casinos. There are limited opportunities for new market expansion efforts near large population centers, which makes the 2017 growth notable. Unlike the commercial gaming segment, which saw revenue growth from market expansion efforts in the Northeastern United States, the tribal gaming revenue growth is considered organic growth. Since the passage of the Indian Gaming Regulatory Act (1988), the tribal gaming segment has grown to encompass more than 240 individual tribal nations operating more than 480 casinos. The development of these casinos has led to the creation of more than 200,000 jobs on tribal lands and generated billions of dollars for neighboring state governments, which have benefited from revenue sharing agreements outlined in various tribal-state gaming compacts. Between 1988 and 2006, the industry consistently generated double-digit growth rates. Since 2006, the tribal gaming industry segment has reached a point of maturity, where there have been limited opportunities to expand into new markets. During the past 10 years, the tribal gaming industry segment has only seen revenue growth at an annualized rate of 2.0% while welcoming more than 90 new casinos, a 23.3% increase in the number of casinos.

$8.92B 27.3%

$3.06B 9.4%

$3.34B 10.2%

$4.97B 15.2%

$7.54B 23.1%

$2.41B 7.4%

$2.40B 7.4%

Portland

Sacramento

Phoenix

Tulsa

Oklahoma City

St. Paul

Washington D. C.

Looking forward, tribal casino revenue growth is expected to continue from economic growth and limited expansion. The expansion will come from the development of resort-destination casinos, acquisition of new lands or commercial gaming entities.

One of the more notable expansion efforts has been the Pokagon Band of Potawatomi Indians (Pokagon), located along the southeastern shores of Lake Michigan. In January 2018, the nation opened a new casino in South Bend, Indiana, with the support of local government officials. The expansion was notable as it demonstrates a tribal nation’s ability to acquire new lands and new economic opportunities in markets that have previously been inaccessible to tribal gaming. Outside the Pokagon’s expansion, other tribal expansion efforts are blurring the lines between commercial and tribal gaming. In early 2018, the Poarch Band of Creek Indians announced plans to acquire the Sands Bethlehem Casino in Pennsylvania from the Las Vegas Sands Corporation. The acquisition of the commercial casino will provide the Poarch Band of Creek Indians access to a new gaming market while also providing them the opportunity to enter the iGaming industry with Pennsylvania’s latest gaming expansion efforts. While tribal gaming has provided significant economic benefits to over 240 tribes, less than 45% of federally recognized tribes offer gaming. For those tribal nations not positioned to developed large-scale destination-resort casinos, the diversification of revenues away from gaming will be critical to further the trends of economic development. Tribal Gaming Statistical Notes The 2017 revenues is estimated by using the National Indian Gaming Commission’s (NIGC’s) prior year (2016) data as a baseline and then projecting the growth rates experienced in each of the seven tribal gaming regions. The calculation of the regional growth rates utilize numerous short-term and long-term metrics monitored by RubinBrown on a monthly basis. The tribal gaming regional summaries included on the subsequent pages (18 to 24), utilizes the NIGC’s revenue data released in July 2017 † . The data represents gaming revenue information collected from all tribes reporting audited financial statements to the NIGC and is a collection of data with varying fiscal year ends occurring within the 2016 calendar year.

Tribal Gaming

17

† see statistical note on page 25