American Gaming Association President Geoff Freeman on Tuesday addressed legislators in Louisiana, a state that was at the forefront of gambling 25 years ago, but hasn’t moved forward much since.
But that might change. The state formed the Louisiana Riverboat Economic Development and Gaming Task Force in November and monthly meetings have ensued.
Gambling revenues in the state have remained flat, as neighboring states have caught up, Freeman said.
“The creation of this task force is also an astute acknowledgment that the public policies that guided gaming’s expansion beyond Nevada and New Jersey are not necessarily the same policies that will empower the industry to succeed in today’s ultra-competitive environment where gaming is now viewed as a mainstream industry,” Freeman said.
Many of the legislators were unfamiliar with national gaming issues, such as sports betting and how Indian tribes legally open casinos. Freeman and a later speaker, Pinnacle Gaming CEO Anthony Sanfilippo, helped provide background, which the legislators appreciated.
Freeman noted that Louisiana’s 24 casinos drive $4.8 billion in economic activity, support nearly 32,000 jobs, and generate $1.3 billion in federal, state and local tax revenues, but the gaming environment has changed dramatically
“Today’s gaming market is far more competitive. While Louisiana was an early entrant, today the state is boxed in on all sides,” he said.
Mississippi’s 28 casinos compete for the same customer base to the east and to the northwest. Oklahoma is home to the second largest tribal gaming market in the U.S. with more than 120 casinos. Texas, to the west, has no legal gaming, but proposals are being floated.
Sanfilippo began his presentation by showing a slide of WinStar Casino in southeastern Oklahoma.
“Drive through Oklahoma and you’ll see impressive facilities,” he said. “Go into WinStar and it takes a mile to walk the floor. They have 7,000 slots.”
Freeman added that there is overall more competition for the entertainment dollar.
“Casinos today also fight for market share not just with other gaming operators, but with sporting events, concerts, restaurants, nightclubs, video games, virtual reality and dozens of other leisure opportunities,” he said.
He also suggested a lower tax base, saying that in Oklahoma tribal casinos pay a range of 4 to 6 percent on gaming revenues, while operators in Louisiana pay 22.5 percent or higher when local taxes are included.
“The gaming industry constantly has to change and improve its product – just like any restaurant in Baton Rouge and every tourist attraction in New Orleans. Your goal should be keeping Louisiana one step ahead of the competition,” he said.
Sen. Daniel R. Martiny noted that Louisiana, like other states, has a big fight against those opposed to gaming expansion.
“We’ve had the hardest time … everything you say makes sense, but others have an interest where they don’t want an expansion of gaming,” he said. “Even if we take the cushions and take them out of the chairs and put in nicer cushions, someone will argue it’s an expansion of gaming.”
Freeman response: “I understand there are still critics of gaming but I assure you the number of critics has significantly diminished. Our most vocal critics are in the markets where we don’t operate. But the same questions are being asked here are being asked in not only the United States, but across the world.”
“We understand there are those who have made major investments have concerns. But what’s going to help this state succeed? If you look through the lens of the customer you’re going to make good decisions.”
Freeman suggested a “progressive regulatory regime, including streamlining the regulatory approval process; empowering regulators and the industry to act; and treating the industry as a trusted partner, not an adversary.”
“By doing these three things, 25 years from now, Louisiana will not need another task force to update the work we are doing today,” he said.
Other challenges faced in Louisiana, officials noted, is that Louisiana riverboat casinos are limited to 30,000 square feet of floor space and new machines face a review that can run up to 11 months before being added to slot floors.
The task force is gathering input from the business community and citizens. They have a deadline of November 2017 to present findings to the House Committee on Administration of Criminal Justice and the Senate Committee on Judiciary B.
