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- Revenue -
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Gross Revenue |
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| While there are many ways to
gauge the size of any industry—by the number of employees, the output
of products, tax receipts or customer count—the most common comparison
is by gross revenues, or sales. When gross revenue is used to gauge the
size of the gaming industry, it is a measure of how much consumers
spend—or the operator wins—on legal gambling games. This appears to
be an easy question. But the answers vary widely. For example, a
Washington Post columnist claimed that "Legal gambling takes
in" about $637 billion yearly. Within a week, however, U.S. News
and World Report stated that "The gambling industry's
revenues" were "$50.9 billion at the most recent count."
Who's right?
To understand why people arrive at different estimates of the gaming industry's size, consider a hypothetical casino customer's experience. Sue and Bill visit Casino Royale one Saturday evening to gamble a bit and see a show. Bill exchanges $100 in cash for 100 $1 tokens to use in Casino Royale' s slot machines. Bill bets one token at a time and bets each of his original 100 tokens. He'll win some of these bets, and he'll lose some of these bets. Because the typical slot machine pays out 90 cents for every dollar put in the slot machine, Bill ends up with about 90 tokens. Bill continues to bet one token at a time, and bets each of his 90 remaining tokens. |
Of his original $100, Bill has $81 left. He has, for all practical purposes, "spent" $19 on the slot machines. He's wagered both his original $100, plus the $90 he had in his tray after his first round on the machine—or a total of $190. But Casino Royale only has $19 from Bill. Confusion between the amount wagered, sometimes called "handle," and the amount actually spent accounts for the widely varying estimates of the size of the legalized gaming industry. The only relevant figure - for Bill's personal accounting, for the casino's accounting and to gauge the size of the gaming industry in relation to other industries—is the amount actually spent by customers, not the total amount they may have wagered repeatedly over the course of the evening. Legalized gambling is accurately depicted as a $54 billion industry, the gross revenue reported by operators before salaries, taxes and expenses are paid. Definition of gross gambling revenue (GGR) = amount wagered minus the winnings returned to players, a true measure of the economic value of gambling. GGR is the figure used to determine what a casino, racetrack, lottery or other gaming operation earns before taxes, salaries and other expenses are paid - the equivalent of 'sales' not 'profit.'
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The following charts show the most recent GGR (Gaming Gross Revienue) statistics available: |
|
Casino Market |
Gross Revenue |
| Legal Bookmaking | $0.13 billion |
| Card Rooms | $0.95 billion |
| Charitable Games & Bingo | $2.50 billion |
| Pari-mutuel | $3.80 billion |
| Indian Reservations | $10.4 billion |
| Lotteries | $17.2 billion |
| Casinos | $26.3 billion |
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Annual Revenue |
| Definition of revenue (gross revenue) = all earnings before taxes, salaries and expenses are paid. The equivalent of sales. Not profit. |
|
Casino Market |
Gross Revenue |
| Las Vegas -- Strip | $4.8 billion |
| Atlantic City, NJ | $4.3 billion |
| Chicagoland (IL, IN) | $2.0 billion |
| Connecticut (Indian) | $1.9 billion |
| Detroit/Windsor, Canada | $1.2 billion |
| Tunica County, MS | $1.2 billion |
| Mississippi Gulf Coast | $1.1 billion |
| Reno/Sparks, NV | $1.0 billion |
| Southern Indiana | $697.4 million |
| Shreveport, LA | $685.0 million |
| St. Louis, MO | $683.8 million |
| Las Vegas -- Downtown | $673.9 million |
| Boulder Strip (NV) | $595.5 million |
| Kansas City, MO | $560.0 million |
| Laughlin, NV | $559.7 million |
| New Orleans | $516.9 million |
| Black Hawk, CO | $433.8 million |
| South Lake Tahoe, NV | $352.7 million |
| Council Bluffs, IA | $347.3 million |
| Lake Charles, LA | $341.3 million |
| North Las Vegas | $236.0 million |
| Vicksburg, MS | $234.7 million |
| Quad Cities (IA) | $210.2 million |
| Des Moines, IA | $185.1 million |
| Baton Rouge, LA | $163.9 million |
| Cripple Creek, CO | $134.5 million |
| Peoria, IL | $129.6 million |
| Dubuque/Marquette, IA | $115.9 million |
| Metropolis, IL | $108.6 million |
| Evansville, IN | $96.6 million |
| Greenville, MS | $73.0 million |
| Central City, CO | $63.4 million |
| Deadwood, SD | $51.8 million |
| Natchez, MS | $36.3 million |
| Sioux City, IA | $35.2 million |
| Fort Madison, IA | $30.0 million |
| Caruthersville, MO | $22.8 million |
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Gaming Revenues: 10 Year Trend |
| As the gaming industry has
expanded throughout the United States, the gross annual revenue has
steadily increased. Gross gambling revenue (GGR) is the amount wagered
minus the winnings returned to players, a true measure of the economic
value of gambling. GGR is the figure used to determine what a casino,
racetrack, lottery or other gaming operation earns before taxes,
salaries and other expenses are paid - the equivalent of 'sales,' not
'profit.' In 2000, for example, the commercial casino industry had GGR
of more than $24 billion*, but paid $10.9 billion in salaries and $3.5
billion in taxes, plus other expenses.
The following charts show the growth from 1990 to 2000 in both the commercial casino industry and gaming as a whole, which includes pari_mutuel wagering, lotteries, casinos, legal bookmaking, charitable gaming and bingo, Indian reservations and card rooms. |
In Billions
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Casino Market |
Total Casino |
Total Gaming |
| 1990 | $8.3 billion | $26.6 billion |
| 1991 | $8.6 billion | $27.1 billion |
| 1992 | $9.6 billion | $30.4 billion |
| 1993 | $11.2 billion | $34.7 billion |
| 1994 | $13.8 billion | $39.8 billion |
| 1995 | $16 billion | $45.1 billion |
| 1996 | $17.1 billion | $47.9 billion |
| 1997 | $18.2 billion | $50.9 billion |
| 1998 | $19.7 billion | $54.9 billion |
| 1999 | $22.2 billion | $58.2 billion |
| 2000 | $24.3 billion | $61.4 billion |
In Billions
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Tax Contributions |
| In the 11 states with commercial casinos in operation in 2000, casinos contributed more than $3.3 billion in tax revenue to state and local governments. The tax rate for the casino industry ranges from a low of 6.25 percent in Nevada to a high of 35 percent in Illinois. The revenue from those taxes benefits education, public safety, economic development and infrastructure improvements, among other state and local programs. |
2000 Calendar Year Gaming Tax Revenue:
|
Casino Market |
Gross Revenue |
| Nevada | $ 707 million |
| Illinois | $ 512 million |
| Indiana | $ 453 million |
| New Jersey | $ 342 million |
| Louisiana | $ 332 million |
| Mississippi | $ 314 million |
| Iowa | $ 206 million |
| Missouri | $ 195 million |
| Michigan | $ 171 million |
| Colorado | $ 82.8 million |
| South Dakota | $ 3.92 million |
