Indian casinos expected to go glitzy with new games
Saturday, December 18th 2004, 2:57 pm
By: News On 6
CATOOSA, Okla. (AP) _ Rising three stories along I-44 and roiling with Las Vegas-style lights, the Cherokee Casino Resort's extravagant sign alone speaks to the $80 million transformation of the old bingo hall here.
Experts consider it a sign of the times in a state on the verge of explosive growth in Indian gaming.
Now that Oklahoma voters have cleared the way for tribes to offer new and potentially more lucrative games, a wave of luxury is expected to sweep through the landscape of tin-roofed bingo centers.
``I think you're going to see the continued migration from these sort of trailer-house operations to these big, elaborate destination facilities,'' says Scott Meacham, the state's finance director and chief negotiator of gaming compacts with tribes.
The Cherokee Nation's 150-room chandelier-draped hotel and casino opened outside of Tulsa just before last month's vote. In Durant, work on the Choctaw Nation's new 7,000-seat entertainment coliseum, casino and expanded hotel is well under way.
The Chickasaw Nation has already upgraded several facilities and is looking at possibly creating new destination centers. As the new games come into play, more tribes are expected to join the trend.
``We had our eye on this the whole time,'' said Osage Chief Jim Gray of the measure's passage, which may help the tribe move faster in building its new north Tulsa casino.
Passage of State Question 712 permits the state to compact with tribes for non-house backed card games and electronic bingo games that work more like Las Vegas slot machines. Voters also approved electronic games at three pari-mutuel horse tracks, two of which are tribally owned.
``We've been racing around the state talking deals ever since,'' said Marcus Prater, senior vice president of marketing for Bally Gaming and Systems.
The new law is expected to bring 10,000 new electronic games to the state, Prater said, for a total of about 30,000 games.
At that number, only four states would have more machines _ Nevada, New Jersey, Mississippi and California, he said.
``When you're making more money and have more machines you have ability to do nicer things with your facilities,'' Prater said. ``You'll have tribes building bigger, newer places.''
In exchange for the new games, the compacts give the state a share of the gaming profits and some oversight.
Tribes closely guard their revenue figures, but Meacham said gaming profits total about $500 million a year statewide. He estimates the state's share will amount to about $71 million annually for education.
Nine tribes _ the Cherokees, Choctaws, Chickasaws, Absentee Shawnee, Comanche, Miami, Eastern Shawnee, Quapaw and Citizen Potawatomie _ had approved the compacts by mid-December.
Meacham expects more to follow. The new games will likely be in place by mid-spring if the Department of Interior approves each of the compacts, he said.
Some tribes expect the games to boost profits by 15 to 25 percent, Meacham said.
But Brian Foster, chairman of the Oklahoma Indian Gaming Association, said the new card games alone could increase business by one-third. His group represents the 27 tribes that operate 79 gaming centers in Oklahoma.
At the least, the compacts protect existing gaming revenues by removing the threat of litigation over games that have tested the boundaries of the law, tribal leaders say.
``I think 712 will go down as a textbook example of how you can take adversarial interests and come up with a common goal and get everyone working together,'' said Chad Smith, principal chief of the Cherokee Nation.
The Cherokees began their gaming venture in 1991 in a metal building in Roland with paper bingo and 63 employees.
Now, 1,123 employees work at the new Catoosa location alone and 500 more will be hired in the coming weeks as a result of the new law, Smith said.
The real value of Indian gaming, he said, ``is creating meaningful jobs and giving us the ability to begin diversification where gaming is not an ends but a means.'' The tribe uses gaming profits not only to pay for services such as law enforcement, education and expanded health care, but also to start up new businesses. The Cherokee Nation's latest ventures include a wireless Internet company intended to help bring the service to rural areas.
Tribes nationwide first opened bingo halls in the late 1970s to fund their operations.
A battle with states over regulation soon followed. In 1988, Congress preserved tribal authority over Class II games such as bingo but required them to compact with states for Las Vegas-style Class III games.
The Cherokee Nation decided two years ago to pursue its resort even without assurance of the new games. It evolved into an entertainment destination, with an 18-hole golf course, live music in three venues, an elegant restaurant and hotel adorned with original Cherokee artwork.
``We wanted to patent what a gaming facility in Oklahoma should be,'' said David Stewart, chief executive officer of Cherokee Nation Enterprises, standing in a lobby draped in Italian glass.
Now, the casino will be converting a banquet hall into a poker room, with hopes of landing on a televised poker tour. An intimate VIP lounge will be reserved for high-stakes card games, Stewart said.
The games are allowed under the new law because they draw their payout from a players' pool rather than the house.
But just because tribes are eager to expand doesn't mean the landscape will be overrun with casinos, Smith said.
Growth is limited by the availability of commercially viable Indian trust land on which to locate them, he said.
``They've all been taken and its almost impossible to see land put in trust for gaming,'' he said.
For now, his tribe plans to expand its Roland and West Siloam Springs casinos, complete upgrades at Will Rogers Downs in Claremore and open smaller casinos in Tahlequah and Sallisaw.
And with the future seemingly as bright for tribal gaming as the giant sign lighting up the sky outside the Cherokee resort, there's already talk of expansion here.