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Looking Up

State of the States 2012 shows the recovery continues

While the commercial casino industry saw its national revenue picture flatten out in 2010 after two years of declining revenue, the economic impact data for 2011 paints an even rosier picture of a commercial casino industry that is well on its way to slow and steady recovery—which should give everyone in the industry reason to be optimistic. This national economic impact data and more can be found in the newly released 2012 “State of the States: The AGA Survey of Casino Entertainment.”

In 2011, commercial casino revenues reached $35.64 billion, which was an increase of 3 percent compared with 2010 figures. Direct gaming tax contributions to state and local governments also continued to rebound in 2011, totaling $7.93 billion, an increase of 4.5 percent compared to 2010 numbers.

These and other positive economic indicators are welcome news to all of us in the industry, and things are beginning to turn around for the gaming equipment manufacturing sector, too. After two years of contraction, the manufacturing sector, on the strength of continued gaming expansion around the world, posted gains in revenue, employment and wages during 2011. Revenue sourced to the manufacturing sector was $12.3 billion in 2011—a robust 7 percent increase compared to 2010 figures. A full analysis of the sector, prepared by Nevada-based Applied Analysis on behalf of the Association of Gaming Equipment Manufacturers, can be found in the new State of the States.

While the economic impact figures in State of the States give empirical evidence of some of the many benefits of casinos—jobs, economic development and tax revenue—the firsthand experience of civic and political leaders in casino communities provides even greater insight into how casinos truly impact the local jurisdictions they call home.

This year’s State of the States report reprises a 2005 survey of civic and political leaders in casino communities, and the results show that the surveyed leaders view the gaming industry, and the positive impact casinos have on their communities, in an overwhelmingly favorable light.

The study, conducted by VP Communications, Inc. in conjunction with national pollster Peter D. Hart, polled 210 elected officials and civic leaders from casino counties in commercial casino states, excluding Nevada. More than three-quarters of those surveyed (78 percent) have lived in their area for more than 20 years. These individuals not only know their communities well, but many have the experience and personal history to evaluate their communities before and after the introduction of casinos.

The survey results indicate that, according to community leaders, casinos have more than delivered on their promises of jobs, economic development and tax revenues, and those benefits can be felt throughout communities. More than half of the community leaders surveyed say casinos have done a good job of providing quality jobs (53 percent) and contributing to local economic activity (52 percent). Seven out of 10 (70 percent) leaders think that casinos do a good job contributing tax revenue, and nearly three out of five (58 percent) agree that casinos do a good job generating area tourism.

Specifically, in regards to tax revenue, nearly three-quarters (71 percent) of leaders say that casinos generate a net tax increase because the taxes are derived from money from outside the area or that would not have been spent otherwise. Those revenues are put to good use, as well more than half (57 percent) of the community leaders say that casino tax contributions have allowed their communities to avoid cutting key programs or start new projects that would not have been possible otherwise.

In addition to highlighting the many benefits casinos bring to local areas, surveyed community leaders also indicate the social ills so many anti-gaming activists claimed would accompany casinos have never materialized. For example, more than three-quarters (76 percent) of community leaders say that casinos have done more to help than hurt other area businesses. Also, almost nine out of 10 (88 percent) say major problems like crime, prostitution and a tarnished image for their community have never come to pass. I’m also happy to report that nearly three-quarters (74 percent) of the surveyed leaders think that casinos are good corporate citizens.

When all is said and done, an overwhelming majority (83 percent) of community leaders says that the overall impact of casinos in their area has been positive, and the same proportion (83 percent) say that the introduction of casinos has met or exceeded their expectations. This is especially impressive given the fact that 70 percent of community leaders had positive reactions to the idea of casinos from the start.

Perhaps the most telling survey result is that, when everything is taken into account, more than three-quarters (76 percent) of community leaders surveyed would choose to vote “yes” if given the chance to go back and cast the deciding vote to allow casinos in their communities.

State of the States also polls the general public about its attitudes toward casino gambling, and this year’s result—81 percent of Americans view casino gaming as acceptable for themselves or others—is in line with survey results during the past decade.

All in all, this year’s State of the States includes a lot of good news for the gaming industry. Not only is our industry continuing to recover, but our community partners are overwhelmingly supportive and appreciative of the benefits we bring, despite all of the recent economic challenges we have experienced. These signs point to a strong future, and make it easy to be optimistic about the positive growth ahead.

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