Oklahoma reports drop in gaming exclusivity fees from tribes

Friday, November 21, 2014

Tribes shared $122.6 million in gaming exclusivity fees with Oklahoma in fiscal year 2014, a decrease from the year prior. Image from Gaming Compliance Unit Annual Report

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Oklahoma's gaming market continues to grow, in terms of number of facilities and number of machines, but tribes are sending fewer exclusivity fees to the state, according to a new report.

For fiscal year 2014, tribes shared $122.6 million with the state. That's down from $128.1 million in 2013, marking the first time since 2004 that exclusivity fees have fallen.

"The 4 percent downturn in exclusivity fee revenues occurred despite an overall increase in the number of Class III games, suggesting possible market saturation," the report from the Gaming Compliance Unit of the Office of Management and Enterprise Services stated. "An increase in Class II machines may have also played a part in the revenue decline."

Of the 30 tribes that shared exclusivity fees in 2013 and 2014, 21 reported declines. Two tribes in particular -- the Comanche Nation and the Ponca Tribe -- saw dramatic changes.

The Comanches shared $3.1 million in 2014, down 48.7 percent from $6.2 million in 2013 The Poncas shared, $50,784 in 2014, down 58.9 percent from $123,530 in 2013.

Of the 9 tribes that saw increases, most saw modest gains. But the Delaware Tribe shared 21.4 percent more in 2014 than 2013, the largest percentage gain.

The Seminole Nation shared 18.4 percent more in 2014 than 2013, the second highest gain. But the tribe's fees -- around $520,000 -- remain relatively low compared to most other tribes.

The Sac and Fox Nation saw a 11.9 percent increase in exclusivity fees, the third highest. But the amount -- around $648,000 -- was still lower than the amount shared in 2012, 2011 and 2010.

The Chickasaw Nation, which operates the largest number of gaming facilities in the state, remained on top for another year. The tribe shared $42.3 million in 2014, up 2.9 percent from $41.1 million in 2013.

But three other large tribes -- the Cherokee Nation, the Choctaw Nation and the Muscogee Nation -- shared fewer revenues in 2014.

Voters legalized Class III gaming through State Question 712 in 2004. Since then, tribes have shared $895 million with the state.

As of 2012, the tribal casino market in Oklahoma grew to $3.7 billion, up from $501.6 million in 2002, according to Casino City’s North American Gaming Almanac.

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