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Indian-run gaming up in SD, US

Revenue at American Indian casinos grew across the nation and in South Dakota during 2011, according to a new report.

The revenue at 13 South Dakota casinos increased from $104.3 million in 2010 to $108 million in 2011, a 4 percent increase. Nine tribes operated the 13 casinos, compared to 11 casinos in 2010.

Nationally, 242 tribes operated 460 gaming facilities in 2011. Revenue increased by 3 percent to approximately $27.4 billion.

The growth brought Indian gaming throughout the United States back above pre-recession levels.

Casino City's Indian Gaming Industry Report, by Alan Meister, an economist with Nathan Associates Inc., gives nationwide and state-by-state statistics. The report was released today.

"Many Native American tribes continued to invest in their gaming operations by remodeling, upgrading and expanding in 2011, particularly with respect to non-gaming amenities," the report says.

Part of the upward trend in South Dakota Indian gaming is due to a 15.9 percent increase in gaming machines. South Dakota Indian gaming facilities operated 2,461 gaming machines in 2011, an increase of 337 over the previous year. Only Alabama recorded a higher increase in 2011, at 28 percent.

The 13 South Dakota facilities also generated $15.3 million in non-gaming revenue, an increase of 3.7 percent over 2010.

Nationwide, the report says non-gaming revenue increased nearly 5 percent to $3.3 billion in 2011. It had declined in 2009 and 2010.

In 2010, the state of South Dakota passed a smoking ban for bars, commercial casinos and restaurants. There was speculation the ban would hurt those businesses, but Indian casinos, by virtue of their ties to sovereign tribal governments, have remained mostly immune to that issue. The Daily Republic surveyed the 12 Indian casinos in South Dakota, and 11 of them allow smoking.

Although Indian gaming revenues grew in 2011 in South Dakota, the state dropped two spots among states with Indian gaming. The state was ranked 16th for Indian gaming revenue in 2010 and was ranked 18th in 2011.

Expansion and renovations to South Dakota Indian casinos helped boost revenue in 2011.

The Yankton Sioux Tribe renovated and expanded its gaming area at the Fort Randall Casino near Pickstown. Officials are planning for further expansion of the hotel and gaming area, and adding a restaurant, lounge and convention center.

Royal River Casino in Flandreau also expanded its gaming area. Officials on the Rosebud Reservation renovated the Rosebud Casino and opened a second casino at Mission called the Turtle Creek Crossing Casino.

The Oglala Sioux Tribe opened East Winds Casino in December 2011 at Martin with class II gaming only -- that is, bingo, pull-tabs, lotto, punch boards, tip jars and instant bingo. Most other casinos offer class III gaming -- slot machines, video and electronic games of chance, craps, roulette, mutual wagering and card games like blackjack.

The Flandreau Santee Sioux Tribe opened the First American Mart casino in April 2011. Although it closed in September 2011, its revenues are still counted in Meister's report.

The report states three tribes are considering future developments.

The Lower Brule Sioux Tribe has proposed building a new casino and travel plaza at Oacoma. This would replace the Golden Buffalo Casino currently on the reservation. The proposed casino would be on tribal trust land within city limits on the west edge of Oacoma.

The Flandreau Santee Sioux Tribe has proposed a casino resort in Sioux Falls, including gaming, a hotel and conference center.

The Cheyenne River Sioux Tribe proposed gaming at its existing motel in Eagle Butte. The tribe may also build a casino on trust land.

Non-Indian commercial gaming increased slightly in 2011 nationwide, but South Dakota was one of five states where the industry declined. Revenue from commercial casinos in the state declined from $106.2 million in 2010 to $100.9 million in 2011 -- a 5 percent decrease. In 2009, commercial casinos in South Dakota had revenues of $101.9 million.

Gaming facilities directly contributed 339,000 jobs and $12.3 billion in wages to the U.S. economy in 2011, the report says. They also paid more than $1.4 billion to non-tribal governments.

"In terms of the future outlook for Indian gaming, it's performance in 2010 and 2011 is encouraging, especially considering that the U.S. economy is still in recovery mode," the report says. "The question is how much further can Indian gaming grow."

Meister speculates the short-term and mid-term outlook for gaming looks good because the economy will continue to improve over time, tribes are investing in gaming operations and there are opportunities to convert from class II to class III operations. But the report says the long-term future is uncertain. Issues like immature markets, limits on Indian gaming and expansion, increasing competition and popularity of Internet gaming may have negative impacts.