Mohegan Sun Casino in Uncasville, Connecticut, unfortunately experienced its fifth consecutive year-to-year decline in gross gaming revenues (-1.0 percent), according to the 2012 New England Casino Gaming Update by the Center for Policy Analysis.

Massachusetts Residents Spent $909 Million on Gaming in 2011

Gale Courey Toensing
4/18/12

Massachusetts residents continued to be big spenders at New England gaming facilities last year, dropping nearly $909 million at resort casinos and slot parlors in the northeast and contributing hundreds of millions of dollars in tax revenues to Connecticut and Rhode Island, according to an annual survey published by the Center for Policy Analysis (CFPA) at the University of Massachusetts Dartmouth.

The ninth annual New England Gaming Casino Update by Dr. Clyde Barrow reported that Bay Staters spent $908.8 million last year on gaming and non-gaming amenities at Connecticut's destination resort casinos and at the slot parlors in Rhode Island and Maine, making more than 7.1 million visits to those facilities. The $908.8 million was a 6 percent increase over 2010 spending levels of $857.2 million, the largest year-to-year increase in spending by residents of any New England state. The increase in spending paradoxically comes as gross gaming revenues generally continued to decline in the lingering recession.

Both Foxwoods Resort Casino and Mohegan Sun Casino experienced a decline in total revenues (gaming and non-gaming) last year, “although gaming revenues appear to be on the verge of stabilizing in 2012,” Barrow reported. Foxwoods total revenues dropped -1.6 percent from $1.19 billion in 2010 to $1.17 billion in 2011. At Mohegan, total revenues dropped -2.3 percent from $1.25 billion n 2010 to $1.23 billion last year. It was the fifth year in a row that profits dropped at both casinos. But Bay Staters made 5.1 million visits and spent $624.1 million at the Connecticut tribal casinos, which are the biggest in the country. The $624.1 million represented a 1.7 percent increase in spending over 2010 when Massachusetts residents spent $613.2 million. In 2011, Massachusetts spending generated $86.9 million in tax revenues to Connecticut. Massachusetts residents represented 32 percent of visitors to Foxwoods and 20 percent of visitors to Mohegan sun.

By contrast, Rhode Islanders spent approximately $200 million at Connecticut’s two casinos last year compared to $209.6 in 2010, a drop of -4.6 percent; New Hampshire residents spent around $64.2 billion in Connecticut, an increase of 10.1 percent over 2010 when they spent $58.3 million. Maine residents spent $34.3 million, a 28.9 percent increase over $26.6 million the previous year; and New Yorkers spent approximately $321.1 million in Connecticut last year, a hike of 3.3 percent over the previous year’s $310.9 million.

Foxwoods, owned by the Mashantucket Pequot Tribal Nation, and Mohegan Sun each pay the state 25 percent of their slot revenues, but they don’t hand over any table game revenues, which represent around 30 percent of all gaming revenues at the tribal casinos in Connecticut.

For the first time, Bay Staters outnumbered Rhode Islanders at Rhode Island’s two slot parlors—Twin River where they accounted for 51 percent of the patrons visiting the parlor, and Newport Grand, where they were 44 percent of the visitors. They spent an estimated $284 million at the two facilities, which is a 7 percent increase over 2010 spending levels and generated more than $157.6 million in tax revenues to Rhode Island state government. Newport Grand reported its seventh consecutive year-to-year decline in net terminal income—a -3.6 percent drop. Twin River, however, reported a 9.2 percent year-to-year increase in net terminal income. Barrow said it’s likely benefiting from its new round-the-clock operation, the introduction of virtual table games, improvements to its non-gaming amenities and higher gas prices that kept Rhode Island and Massachusetts residents closer to home. In November, Rhode Island residents will be asked at a referendum to approve or reject the addition of table games at the two slot parlors.

Massachusetts state government approved the creation of two commercial casinos and one tribal casino last year based in part on the expectation that the hundreds of millions of dollars in tax revenues that Bay Staters contribute to other states will pour into the state coffers.

Hollywood Slots in Bangor, Maine, reported its first year-to-year decline in net slot machine income in 2011—a drop of -3.6 percent.

Barrow said that the “Great Recession” has shown that casino gaming is no longer “recession proof,” but the recent decline will not last forever. “There’s no question the New England (and the Northeastern) gaming market is still being buffeted by the lagging effects of the Great Recession, but this is likely a temporary setback that is reversible once the economy enters a new growth phase and unemployment rates start to decline in the region,” Barrow said.

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