Michigan Tribal Casinos Fared Better Than Detroit In 2020, But Slot Revenue Down 20%

Michigan tribal casinos saw slot machine revenue drop 19.8% in 2020, as the coronavirus pandemic cut into the biggest source of funding for the state’s 12 federally recognized tribes.

Slots still generated more than $1.22 billion in revenue, despite all 23 tribal casinos being closed for at least several weeks and having restrictions for most of the year.

That drop is not nearly as profound as the one suffered by Detroit’s casinos. The Michigan Gaming Control Board reported in January that revenue for table games and slot machines was down 57.3% in 2020 for Greektown Casino, MGM Grand Detroit and MotorCity Casino.

Unlike the Detroit trio, Michigan tribal casinos are not subject to Michigan Gov. Gretchen Whitmer’s orders, which were among the most restrictive in the US.

The tribal slot machine numbers come from the MGCB’s annual Indian Gaming report issued last week. The report detailed how the 12 tribes distributed $24.4 million in 2% slot machine revenue share payments to local units of state government and local revenue sharing boards. That arrangement comes as part of their compacts with the state.

The report does not detail tribal table games revenue. The effect on those games could be higher than with slots because of the more restrictive pandemic measures.

Snapshot: FireKeepers Casino lost $46.8 million in slot revenue

FireKeepers Casino in Battle Creek is an example of a Michigan tribal casino that successfully navigated the pandemic.

Just like each of Michigan’s 25 other casinos, FireKeepers closed in March 2020.

Even though Whitmer kept Detroit’s commercial casinos closed through early August, FireKeepers opened on June 1 with amenities such as valet parking, buffets, bingo and the poker room closed.

Speaking in a webinar last week presented by the National Indian Gaming Association, FireKeepers CEO Kathy George relayed some of the triumphs from a tough year. She mentioned bringing back all employees who were willing to and able to work after the closure, and  the casino paid more than $10 million in wages and benefits during the 12-week shutdown.

“We’ve been able to maintain all the employees, even the ones from the buffet and the valet and poker,” George said. “We’ve redeployed them around the property.”

FireKeepers has about 3,000 slot machines on property, George said, but had to close many down because of social distancing. Others were moved to the poker and bingo rooms, and about 2,100 are currently operational. FireKeepers was Michigan’s first tribal casino to open a retail sportsbook on June 22.

The casino reported $292.8 million in 2019 slot revenue. That figure fell to $245.9 million in 2020, a 16.0% drop. The casino was still able to distribute $4.9 million for its annual 2% payments to local organizations such as Harper Creek Community Schools, the Calhoun County Road Commission, Willard Library, Kellogg Community College and the city of Battle Creek. The tribe also paid $10.8 million to the state.

The poker room is set to reopen on May 1, 2021. Seeking more employees last week, FireKeepers held a job fair, in some cases offering employment on the spot.

Separate tribal casino payments to state down 47.1%

The MGCB does not regulate Michigan tribal casinos, which sit on sovereign lands. This report gives us the most complete and comprehensive picture we’ll see about the pandemic’s effect on tribal casinos.

However, the regulator does report annually on the 2% revenue sharing payments. The MGCB also reported $28.9 million of payments made by tribes to either the Michigan Strategic Fund or the Michigan Economic Development Corporation, which are based on separate requirements in the compacts.

That amount was down 47.1% from 2019, when the tribes made $54.7 million in payments to state funds. Those payment amounts vary by tribe based on their individual compacts.

But a clearer picture is found in the 2% payments, which are consistent for each Michigan tribe.

Soaring Eagle, Island Resort kept up revenue best

The Saginaw Chippewa Indian Tribe, which operates Soaring Eagle Casino Resort in Mount Pleasant and Saganing Eagles Landing in Standish, once again led the way among Michigan tribal casinos in slot wins.

The tribe generated $264.7 million from slot machines, down 13.5% from 2019.

That percentage decrease was second-fewest among the 12 tribes. The Hannahville Indian Community, which operates Island Resort and Casino in the Upper Peninsula town of Harris, had just an 11.8% drop in revenue.

The tribe was the first to reopen its casino in mid-May after being closed for about two months.

The reopening came after an earlier attempt was delayed. Michigan Attorney General Dana Nessel threatened penalties in early May to patrons and employees who lived off-reservation.

The Hannahville tribe supplanted the Little Traverse Bay Bands of Odawa Indians, operators of two Odawa Casinos in northwest Michigan, for eighth place in the revenue rankings.

That was the only shift in rankings for the 12 tribes.

Ojibwa, Bay Mills casinos suffer worst losses

The Keweenaw Bay Indian Community, which operates Ojibwa Casinos in Baraga and Marquette of the U.P., suffered the biggest slot revenue hit. Their revenues fell 48.1% to $14.2 million.

Next was the Bay Mills Indian Community, which had slot revenue losses of $9.9 million. The drop was 46.3% from 2019.

The Bay Mills tribe shut down its flagship Bay Mills Casino in Brimley a second time during the winter. The tribe’s smaller casino 2 miles up the road, Kings Club Casino, closed in the first wave of the pandemic in March and has still not reopened.

Overall, the five Upper Peninsula tribes reported a 24.5% slot revenue loss down to $138.8 million. The seven Lower Peninsula tribes had a 19.2% loss  after their totals reached $1.08 billion.

The overall 19.8% loss in slot machine revenue was the first double-digit drop in 11 years of reports. During that span, yearly revenue had risen 16.4% — from $1.31 billion in 2010 to $1,52 billion in 2019.

The MGCB also oversees tribal online sports betting and internet gaming to include online casinos and poker, as those games feature wagers made throughout the state on non-reservation land.

Michigan is already one of the nation’s most robust markets. We should see March’s online gambling totals from the state this week.