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State’s share of casino revenue drops 9.4% in first quarter of ’09

Arizona’s prime tourism season was better for the state’s Indian casinos than was the holiday season, which brought a record drop in casino revenue sharing for the state.

The 15 gaming tribes sent 9.4 percent less shared revenue from casinos to the Arizona Department of Gaming for the January-to-March period compared to last year. Still, the spring decline was better than the 16.1 percent drop for the October-to-December quarter, according to department statistics.

The tribes sent $22.1 million to the Gaming Department for the first quarter, a slide from $24.4 million the same quarter last year. First-quarter shares were $24.6 million in 2007 and $22.4 million in 2006.

The past three quarters have had the three biggest year-to-year cash declines in casino revenue sharing since the Arizona Tribal-State Gaming Compact was put in place in 2003. The compact allowed tribes to add blackjack tables and more slot machines in exchange for opening casino books to state audits and sharing 1 percent to 8 percent of gambling revenues.

Revenue sharing has declined six straight quarters since the start of 2008. Before that, the amount shared had increased each of the 18 quarters since revenue sharing started, according to Gaming Department statistics.

Tribes have shared $505 million with the state in six years, with most of the money distributed to schools, trauma centers, wildlife conservation, tourism agencies and gambling-problem programs.

Mark Brnovich, the new Gaming Department director, said casinos, like other businesses, are not immune to economic crises.

“Nevertheless, their operations continue to generate significant funding for valuable programs,” Brnovich’s news release read. “Current decline in tribal gaming revenue in Arizona is only about half of what is being reported at tourist destinations such as Las Vegas.”

Gamblers indeed are loosening the purse strings at Casino del Sol and Casino of the Sun, said Wendell Long, chief executive of the Pascua Yaqui Gaming Enterprise Division.

“Although we are not happy with 9.4 percent, at least we’re fortunate not to see the 20 percent decreases in Atlantic City and Las Vegas,” Long said.

The Pascua Yaqui casinos have held steady with about 1,200 employees through the last three quarters.

“The tribe is committed not to lay off any people and we’re not going to lay anybody off,” Long said.

The 23 Indian casinos in Arizona operate a total of 14,654 slots, 212 poker tables and 259 blackjack tables. The Desert Diamond Casino on Nogales Highway and Harrah’s Ak-Chin Casino in Maricopa have the most slot machines in Arizona: 1,089.

The two Pascua Yaqui- and three Tohono O’odham-operated casinos in the Tucson area have a combined 3,385 slot machines, 43 poker tables and 47 blackjack tables, according to Gaming Department statistics.

Tribes pay the state 1 percent of the first $25 million in revenue, 3 percent of the next $50 million, 6 percent of the subsequent $25 million and 8 percent when cumulative revenue during a year exceeds $100 million.


How gaming revenue is distributed

The Arizona Department of Gaming distributed tribal casino revenue-sharing funds for January through March as follows:

• $2 million stayed with the Gaming Department to cover administrative and regulatory expenses

• $442,055 went for problem-gambling education, treatment and prevention

• $11 million went to the instructional-improvement fund for schools

• $5.5 million went to the trauma and emergency services fund

• $1.6 million went to the Arizona wildlife conservation fund

• $1.6 million went to the tourism fund

Source: Arizona Department of Gaming

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