Pandemic Decimated Casino Revenues for Tribes, State

Wisconsin’s general fund received 80 percent less money from tribal gaming payments last year after the COVID-19 pandemic closed the doors of tribal casinos, according to a report released Thursday from the nonpartisan Wisconsin Policy Forum. The state is expected to lose out on $70 million over 2020, 2021 and 2022.

But the report says the impact of casino closures on tribal governments will be far greater.

“Because casino revenues can make up the majority of some tribes’ budgets, substantial shortfalls have led to cuts in services such as health care,” according to the report. “Recent federal aid legislation will not necessarily offset all of these losses. Plummeting casino revenues also have wreaked havoc on casino workers and operations with ripple effects for local communities.”

Wisconsin’s 11 federally recognized tribes have exclusive rights to regulate gaming on Indian lands, and they signed compacts with the state in 1991 and 1992. Those agreements set the regulations and conditions under which tribes can conduct gaming, which includes payments to the state.

Gaming revenues are split between the state and tribes, who use the money to support tribal programs. The WPF report found that gaming payments to the state totaled around $5.3 million by the end of June last year. In the previous fiscal year, tribal gaming payments to the state amounted to roughly $29.1 million.

The Potawatomi Hotel & Casino in Milwaukee, which is the state’s largest casino, laid off around 1,600 workers when it was closed from mid-March to early June. Other tribes like the Oneida Nation, Red Cliff Band of Lake Superior Chippewa and Ho-Chunk Nation were also impacted by shutdowns related to the pandemic.

The Wisconsin Department of Administration is expecting there will not be enough revenues from tribal gaming to go toward the state’s general fund this year. The agency had previously anticipated tribes would provide $27 million in payments to the state prior to the pandemic. The state uses the money to pay for a variety of services, including health care, tourism marketing, conservation and revitalization of tribal languages.

Tribal gaming payments make up a small fraction of the $18 billion in revenue that goes into the state general fund each year.

The loss in revenue means that tribal gaming payments won’t cover appropriations that had been made under the budget for the year ending June 30. State agencies were authorized to spend $29.7 million, but they’ll likely have to draw money from other sources to make up for the drop in payments.

Report: Closed Casinos Mean Financial Struggles For Tribes, Drop In Payments To State was originally published by Wisconsin Public Radio.