It's been a good 12 months for the Potawatomi's Milwaukee casino — business is up about 2.4% and there is little chance of a major competitor entering the tribe's market any time soon.
The tribe raked in at least $360 million from the slot machines and table games at Potawatomi's Hotel & Casino in the 12-month period ended July 31, up from more than $352 million the previous fiscal year, according to a Journal Sentinel estimate. The estimate is based on revenue after the tribe makes its annual payment of $25 million to $30 million to the state. The net win would be increased by that amount, so the actual net win is about $390 million.
The city and county of Milwaukee each received $5.41 million from the tribe on Monday, up from $5.28 million last year. Each receive 1.5% of the net win, after the state receives its payment.
Casino revenue is used to pay each of the tribe's members about $70,000 per year and to help run the northern Wisconsin tribe's government.
Analysts say the increase is in line with industry trends.
"It is now safe to say the American casino industry has recovered, and the new normal is growth again," states the most recent National Revenue Report published by Fantini's Gaming Report. "June marked the third month in a row and the sixth of the last seven in which gaming revenues in regional markets beat the year before."
The report tracks revenue posted by commercial casinos but not those of tribal gambling halls, which are often confidential.
Gaming revenue at regional commercial casinos was up 2.53% nationally for the first six months of this year, according to Fantini's report. Revenue in June 2015 was up 1.97% as compared to June 2014.
"The consumer economy is finally rebounding," said Frank Fantini, chief executive officer at Fantini's Gaming Report.
In June, gaming revenue was up about 1% in casinos in Detroit and Illinois, according to the monthly report. Revenue fell nearly 3% in Indiana and was flat in Iowa.
The Potawatomi attributed much of their gain to the hotel that the tribe opened last year next to the casino.
The hotel allowed the casino "to remain competitive in a mature market, and prevented (the casino) from experiencing the loss of business that many casinos across the state, region and nation have felt," according to a tribe email statement.
Another plus for the tribe is lack of new competition emerging in Wisconsin or northern Illinois. For several years, there have been attempts to expand the number of casinos in Illinois, and lawmakers in that state have not approved any expansion.
Gov. Scott Walker this year rejected a bid by the Menominee tribe to open an $800 million casino complex in Kenosha — a facility the Potawatomi said would have sliced into profits in Milwaukee. The Potawatomi spent millions fighting the Menominee effort that started in the 1990s.
"The Hard Rock casino would be closer to Chicago and would have captured much of the Chicagoland market" that now travels to Potawatomi, said Alex Bumazhny, a gaming analyst at Fitch Ratings. "It would have been pretty successful and obviously would have harmed Potawatomi."
Menominee chairman Gary Besaw said the revenue increase posted at Potawatomi shows there is ample business for another casino, and he implied the Menominee's bid to open one is not dead.
"The decision had been made (by Walker), but that doesn't preclude us from taking another type of legal action," Besaw said Monday. He declined to elaborate.
Still, Bumazhny cautioned there is limited growth seen for the casino industry.
"We see gaming growth in general to be pretty flat," Bumazhny said.
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