As Oklahoma’s economy sputtered in the last fiscal year, people continued to gamble.
The state of Oklahoma got a 3 percent bump in tribal gaming revenue in the 2016 fiscal year, a welcome boost as other revenue has lagged with a downturn in the energy market.
Tribes paid the state $132 million in exclusivity fees from certain electronic and table games, the state said Wednesday. According to the state’s Office of Management and Enterprise Services, that $132 million in state funding, which mostly goes to education, is generated from about $2.2 billion in casino revenue from well over two dozen tribes across the state.
In fiscal year 2015, the state received $128.4 million, which was then the highest total since tribal gaming became legal in the state.
The numbers were released in a report by the Oklahoma Gaming Compliance Unit, a division of the Office of Management and Enterprise Services.
People are also reading…
“The record amount is not only good news for Oklahoma education funding, but also continues an upward trend,” the report states.
Only one of the three tribes with the largest gaming presence in the Tulsa area — the Cherokee Nation — saw an increase in the exclusivity fees it pays the state. Cherokee exclusivity fees jumped by 7 percent. The Osage and Muscogee (Creek) nations saw declines in the fees they paid the state, falling by about 3 percent and 5 percent, respectively.
Mark Fulton, chief operating officer of Cherokee Nation Entertainment, said the tribe has seen tremendous growth in the past year. He credited some of that to a new casino in South Coffeyville, which is mere miles from the Kansas border.
The Creeks and Cherokees said Oklahoma’s economic weakness hasn’t shown as much in Tulsa as it has in the more rural, less economically diversified parts of the state.
A study from Oklahoma City University last year showed that about half the exclusivity fees paid to the state came from rural areas.
Pat Crofts, CEO of the Muscogee (Creek) Nation Casinos, said the economy’s impact on rural operations is because of their dependence on oil and gas exploration and extraction.
He said the tribe’s revenue has been flat in the economic downturn.
“You see that a lot more in the rural, non-metropolitan areas,” said Fulton, the Cherokee Nation Entertainment CEO.
He said the Cherokees watch consumer confidence and the unemployment rate closely, adding that the state unemployment rate’s rise has had a “crippling effect.”
Both Crofts and Fulton said the increase in exclusivity fees is a sign that the casino market isn’t saturated, but that the saturation point is probably not that far away.
The Creeks massive expansion of its River Spirit Casino — the addition of Jimmy Buffett’s Margaritaville brand, which comes with hundreds of new luxury hotel rooms on the banks of the Arkansas River — could either grow the market or further divvy it up.
Fulton expects Cherokee casinos to take a hit.
“We’ll have some impact from the Creeks and their expansion over there. Hopefully, as they’ve been telling everyone, they’ll grow the market and bring people in,” said Fulton. “They’ve invested a lot. We expect that there will be some shared trips now. We’re bullish on Oklahoma.”
Crofts said, as he has in the past, that the Creeks expect to be a regional draw and grow the market.
That market could be under threat along its eastern border, however. A ballot measure in Arkansas allowing three casinos will go before voters in November.
The Cherokee have agreed to operate one of the casinos and have donated $400,000 to help the campaign. The validity of some of the signatures collected to get it on the ballot has been challenged in court.
“If that did happen (the measure passes), you would see very little expansion of gaming in northeast Oklahoma,” said Crofts. He added: “There’s certainly nothing going to be built in Arkansas that comes close to what we’ve built in Tulsa.”