State Of The States 2020 - American Gaming Association

devices in different states. State-specific terminologyfor electronic gaming devices includes video lotteryterminals (VLTs), video gaming terminals (VGTs), videopoker, and electronic gaming machines, among others.All references to “gaming revenue” are used as asubstitute for more specific financial terms— including“casino win,” “adjusted gross receipts,” “gross gamingrevenue,” and others—as reported by state regulatoryagencies. Gaming regulatory agencies in each statereport monthly and annual revenue differently andreaders should consult those agencies’ websites forfurther information.In general, gaming revenue refers to the amountearned by commercial casinos after winnings havebeen paid out to patrons. Importantly, gaming revenuedoes not equate to profits earned by commercialcasinos from their operations. Such revenue is earnedbefore properties pay for various operating expenses,marketing, and employee salaries, as well as varioustaxes and fees, among other things.Similarly, gaming tax revenue figures listed in thereport reflect only specific gaming taxes paid bycasinos out of monies won from patrons. They do notinclude various other taxes that apply to casinos as theydo to most other businesses. They also do not includethe federal excise tax of 0.25 percent generally appliedto sports betting handle across most states. For thepurposes of calculating state gaming tax revenuetotals, reported tax figures include revenue directedto state and local governments and the specificcasino revenue funds established by those entities,it also includes certain other taxes collected by stategaming regulators. Finally, gaming taxes includefurther mandatory allocations of gaming revenue fromcommercial casinos to non-government entities, suchas problem gambling services, race purses, breedingprograms, and other funds used to support localracing industries.Information on supplier licensing in the table inthis report is limited to those supplier entities thateither manufacture electronic gaming devices ortable game equipment, or distribute or otherwise sellthem to casinos. In many states, additional licensingrequirements are applicable to the suppliers ofvarious other goods and services to casinos. Readersare advised to consult the websites of state gamingregulatory agencies for more specific information.About the AmericanGaming AssociationThe American Gaming Association is the premiernational trade group representing the 261 billionU.S. casino industry, which supports 1.8 million jobsnationwide. AGA members include commercial andtribal casino operators, as well as suppliers and otherentities affiliated with the gaming industry. It is themission of the AGA to achieve sound policies andregulations consistent with casino gaming’s modernappeal and vast economic contributions.www.americangaming.orgAbout VIXIO GamblingComplianceVIXIO GamblingCompliance is the leading providerof independent legal, regulatory and businessintelligence to the global gaming industry, basedin London, Washington D.C. and Taipei. Throughour subscription services and customized researchsolutions, we offer market participants, regulators,governments, and investors easily accessible and upto-date information on market realities and a reliableand independent service to monitor legislative andregulatory developments.www.gamblingcompliance.comIn certain states, gaming is operated under theauthority of the state government, and a portionof casino revenue is then redistributed to privateoperators. Where this is the case, this report considersthe effective tax rate applied to gaming operators to bethe portion of gaming revenue retained by the state orits designated beneficiaries.STATE OF THE STATES 2020 The AGA Survey of the Commercial Casino Industry4

EXECUTIVE SUMMARYState of the IndustrySTATE OF THE STATES 2020THE AGA SURVEY OF THE COMMERCIAL CASINO INDUSTRY5

EXECUTIVE SUMMARYState of the IndustryAmerica’s commercial casino industry enjoyed another record-settingperformance in 2019, a year when annual direct gaming tax revenuegenerated for state and local governments surpassed 10 billion forthe first-time ever.Total nationwide consumer spending on casino gamingincreased for a fifth straight year to reach a record 43.61 billion, up 3.7 percent from 2018.Overall, 14 of the 25 states with commercial casinosreported record annual gaming revenue in 2019,reflective of strong local economies in many parts ofthe countries and the addition of sports betting incertain markets. Only four states reported lower casinogaming revenue in 2019 than the previous year.Economic ImpactAll-time highs in gaming revenue translated into arecord 10.16 billion in direct gaming tax revenuepaid to state and local governments by commercialgaming operations.Notably, the 10.16 billion figure—an increase of4.1 percent over 2018—reflects only specific stateand local taxes that are applied directly to gamingactivities. It does not include the billions more paid bythe industry in the form of income, sales, and variousother corporate taxes, nor does the total reflect payrolltaxes paid by gaming operators and suppliers.According to the most recent statistics from OxfordEconomics, the U.S. commercial casino industrydirectly employed more than 361,000 people in 2017and those employees earned more than 17 billion inwages, benefits and tips that year.Overall, the gaming industry—including tribal operatorsand gaming suppliers—remains a major contributorto the wider U.S. economy, generating approximately 261 billion in total economic activity, including anestimated 52 billion worth of revenue to outsidecontractors and small businesses, while supporting anestimated 1.8 million jobs.Tribal GamingNotably, the above gaming revenue and direct gamingtax totals do not include contributions from the 524tribal casinos operating across 29 states.Revenue figures for 2019 had not yet been released atthe time of writing. However, figures for 2018 showedtribal casinos reaching a record total of 33.72 billionin annual gaming revenue.The tribal casino gaming industry has reported revenuegrowth in every year since the Great Recession, and2019 saw further signs of tribal gaming fulfilling itsmission of helping sovereign Indian nations to advancetheir economic development, with various tribal-ownedgaming entities even electing to compete alongsideprivate gaming companies in commercial casinomarkets such as Pennsylvania, Arkansas, and Indiana.Sports BettingOne obvious area of growth for the commercial gamingindustry in 2019 came from the continued spread oflegal sports betting in the wake of May 2018’s U.S.Supreme Court ruling allowing all states to authorizewagering on sporting events.STATE OF THE STATES 2020 The AGA Survey of the Commercial Casino Industry6

By the end of 2019, 14 states were offering legalsports betting, up from eight at the start of year.A further six states, plus the District of Columbia,also legalized the activity during 2019 and wereactively preparing to implement their laws as the yeardrew to a close.Americans legally bet more than 13 billion on sportswith regulated operators in 2019, almost doublethe equivalent total from the prior year. Sportsbookoperators earned 908.9 million in sports bettingrevenue, versus 430.7 million in 2018.Despite that impressive growth, the offshore,unregulated market for sports betting remains strong.The AGA continued to advocate throughout 2019for states to adopt legislation and regulations thatappropriately reflect the low-margin nature of sportswagering—in which approximately 95 percent ofamounts wagered are returned to winning bettors—andallow legal operators to be competitive with offshoresportsbooks who pay no taxes or fees, and face noregulatory constraints whatsoever.Notably, states with legal online and mobile sportsbetting outperformed those that continued to restrictlawful wagering to retail sportsbooks. Online sportsbetting accounted for more than 81 percent ofannual sports wagering revenue in New Jersey, withPennsylvania and Indiana quickly trending in a similardirection after those two states launched online sportsbetting in May and October respectively.Responsible GamingAnother area in sharp focus for the commercial casinogaming industry in 2019 was its strident commitmentto responsible gaming.The Responsible Gambling Collaborative (RGCollaborative), launched in 2018 to bring togetherindustry, advocacy, and academic voices, continuedits work in 2019 by developing a first-ever set ofguiding principles for fostering responsible gamingand mitigating problem gambling. An accompanyingstudy by the RG Collaborative also found that not allstates spend their allocated tax revenue on responsiblegaming initiatives as intended by state law.Going forward, the RG Collaborative will continueto coordinate efforts to ensure states and gamingoperators implement responsible gaming programs andpolicies that are proven to be effective.American Attitudesto Casino GamingDuring the quarter-century since the AGA was formed,the U.S. commercial casino industry has transformedinto a major economic force within the wider leisure,entertainment, and tourism sectors, with a presence inexactly half the states across the country.AGA polling demonstrates how Americans have alsodeveloped an increasingly favorable view of the industryas more and more patrons have frequented casinosand their wide variety of entertainment offerings.Approximately 105 million Americans are estimatedto have visited a casino in the past year, versus53 million in 2001, according to 2019 AGA pollingdata. A majority of them were attracted by shows,restaurants, or other amenities, rather than gamingofferings, and around a quarter visited a casino withoutgambling at all.Overall, 86 percent of Americans consider gamingto be a fully acceptable form of entertainment, while71 percent recognize the casino industry’s role asa job-creator.Illegal GamingBy paying billions of dollars in taxes, meticulouslycomplying with state and federal laws, and wholeheartedly committing to responsible gaming,commercial and tribal casinos operate very differentlythan the still sizable market for illegal gamblingprevalent in many states.In 2019, various states struggled to contain arapid proliferation of illegal gaming devices in bars,convenience stores, and other venues.Going forward, the AGA and its partners will continueto highlight risks of unregulated gaming operations andcommit to assisting state and local policymakers indeveloping effective strategies to eliminate them.STATE OF THE STATES 2020 The AGA Survey of the Commercial Casino Industry7

State By State Regulations, Taxes & FeesARKANSASCOLORADOStatutory Funding forResponsible GamingNoStatewide Self-ExclusionNoNoGambling Age21Smoke-Free (Y/N/Partial)2% of casinogaming revenueDELAWARE 1 million or 1% ofelectronic gamingdevice revenue,whichever greater.FLORIDAILLINOISINDIANARiverboats: 3.33% of thesupplemental wagering taxRacinos: 500,000 perlicensee annually. 250,000 percasinoSubject to esYesNoComplimentary tions onOperating HoursNoNoNoNoNoNoNumber of Licenses Allowed4Unlimited38*2013*Number of Casinos333381013 250,000 or1% of tablegame revenue,whichever greater.Riverboats: Graduatedrate ranging from 15% oncasino gaming revenueof up to 25 millionto 40% on gamingrevenue of more than 600 million. Land‑based,with one exception, alsopay a supplementalwagering tax of 3.5%.13% on the first 150 million incasino gamingrevenue, 20%thereafterGraduated rateranging from0.25% on casinogaming revenueup to 2 million to20% on gamingrevenue of morethan 13 million.Casino License RenewalTerm and FeeEvery 10 years 10,000Every two years 3,700– 7,400 3 million annually(Combined) 2.25 millionannuallyLicense renewalevery 4 yearswith 250,000annual fee.Supplier LicenseRenewal Term and Fee 1,000 annuallyManufacturer/Distributor:Every two years 3,700– 7,400Gaming vendor:Every threeyears 4,000 2,000 everythree yearsSupplier license:Every 4 years with 5,000 annual fee.Supplier license 7,500 annuallyMinimum InvestmentNoNoNoNoNoNoAdmissions TaxNoNoNoNoYesNoTaxation of PromotionalCredits ings on WinningsYesYesNoNoYesYesEffective Tax Rate57% on electronicgaming devicerevenue;20% on tablegame revenue35% on electronicgaming devicerevenueGraduated rateranging from15% on casinogaming revenueup to 25 millionto 50% on gamingrevenue of morethan 200 millionSports betting: 3.33%of tax revenue to theaddiction services fund.Racinos: 25% of revenueup to 100 million;30% on revenue from 100 million to 200 millionand 35% on revenueexceeding 200 million.Riverboats: 5,000 annually;Racinos: 100 per electronicgaming device annuallyNumber of licenses allowed* Assuming no additional racetracks open in the state.STATE OF THE STATES 2020 The AGA Survey of the Commercial Casino Industry8

State By State Regulations, Taxes & Fees (continued)IOWAKANSASLOUISIANAMAINELand-Based: 3% ofelectronic gamingdevice revenue.MARYLANDUp to 6 million annually2% of casinogaming revenue1% of casino gamingrevenue; max. 500,000per facility.Statewide Self-ExclusionYesYesYesYesYesGambling Age2121212121Smoke-Free (Y/N/Partial)NoNoPartialPartialYesComplimentary AlcoholYesNoYesNoNoCreditNoNoYesNoYesRestrictions onOperating HoursNoNoNoNoNoUnlimited4*20*261942026Racino: 39% on electronicgaming device revenueand 1% on handle; 16%on table game revenue40–61% on electronicgaming device revenue;Statutory Funding forResponsible GamingNumber of Licenses AllowedNumber of CasinosEffective Tax RateGraduated rate rangingfrom 5% on casinogaming revenue upto 1 million to 22%on revenue of morethan 3 million.Riverboats: 21.5% oncasino gaming revenue,with additional taxesand fees applied bylocal governments.27% on casino gamingrevenue (minimum)Racinos: 22% or24% depending onvarious conditions.Casino License RenewalTerm and FeeLand-based: 5 perperson per facilitycapacity (min. 1,250);Maximum initialterm of 15 yearsRacinos: 1,000 annuallyDistributor: 1000annually;Racinos: around 36% oncasino gaming revenue.Land-Based: either21.5% on casino gamingrevenue or an annual feeof 60 million, whicheveris greater, plus rent andvarious other paymentsto local authorities.Riverboats: 100,000annuallyLand-Based: Fees est. bymanagement contract.Racino: 100,000 fromelectronic gaming devicerevenue and 9% oftable game revenue.Land-Based: 46%on electronic gamingdevice revenue; 16% ontable game revenue 80,000 annuallySlot machine distributor: 75,000 annually; 425 per electronicgaming device and 500 per table game20% on tablegame revenue 3 million for every500 electronic gamingdevices; 15-yearinitial license termManufacturer: 5,000 annually;Manufacturer: 250 annuallyGaming SupplierCertification is validfor two years. Nolicensing fees.Supplier: 3,000 annuallyMinimum InvestmentNoYesNoNoYesAdmissions sSupplier LicenseRenewal Term and FeeTaxation of PromotionalCredits (Y/N/Partial)Withholdings on WinningsManufacturer: 15,000 annually;Table games distributor: 1,000 annually;Gambling service vendor: 2,000 annuallyDistributor: 1,000annuallyNumber of licenses allowed* Assuming no additional racetracks open in the state.STATE OF THE STATES 2020 The AGA Survey of the Commercial Casino Industry9

State By State Regulations, Taxes & Fees INEVADAAt least 5 millionannually 2 million annuallySubject to annualappropriation0.5% of casinoadmission feesSubject to annualappropriationStatewide Self-ExclusionYesYesYesYesNoGambling Age2121212121Smoke-Free (Y/N/Partial)YesPartialNoPartialNoComplimentary ions onOperating HoursNoNoNoNoNoNumber of Licenses Allowed43Unlimited13UnlimitedNumber of Casinos33261321919% on casinogaming revenueGraduated rate rangingfrom 4% on casinogaming revenue up to 50,000 per month to8% on gaming revenue ofmore than 134,000 permonth, plus additionalhost municipality licensefee at an average rateof 3–4% on gamingrevenue annually21% on casinogaming revenueGraduated rate rangingfrom 3.5% on casinogaming revenue up to 50,000 per monthto 6.75% on gamingrevenue of more than 134,000 per month 25,000 annuallyLicenses valid 3 yearsbut subject to annual feeof 5,000 and additionalfee based on numberof games offered 25,000 annually 250 per electronicgaming device as excisetax, plus additional 80per device annually.Table games fees aredependent on the amountof games in operation.Statutory Funding forResponsible GamingCasino-Resort: 25% oncasino gaming revenue;Effective Tax RateCasino License RenewalTerm and FeeSlot Parlor: 49% onelectronic gamingdevice revenue 600 per electronicgaming device annuallyManufacturer: 1,000 annually;Supplier LicenseRenewal Term and FeeManufacturer: 1,000 annually;Distributor: 500annually;Gaming Vendor: 15,000every three yearsSupplier: 5,000 annuallyMinimum InvestmentYesNoYesNoNoAdmissions TaxNoNoNoYesNoTaxation of PromotionalCredits (Y/N/Partial)NoYesPartialYesNoWithholdings on WinningsYesYesYesYesNoSupplier: 5,000 annuallyDistributor: 500 annuallyInteractive gamingsystems: 25,000annually.Number of licenses allowed* Assuming no additional racetracks open in the state.STATE OF THE STATES 2020 The AGA Survey of the Commercial Casino Industry10

State By State Regulations, Taxes & Fees (continued)NEW JERSEYNEW MEXICONEW YORK 600,000 annually plus 250,000 per internetgaming licensee0.25% of casinogaming revenueSubject to annualappropriationStatewide Self-ExclusionYesYesYesYesNoGambling Age2121Land-Based: 21;Racinos: 182118Smoke-Free (Y/N/Partial)NoNoYesYesNoComplimentary AlcoholYesNoYesNoNoCreditYesNoNoYesNoStatutory Funding forResponsible GamingOHIOLand-Based: 2% ofcasino gaming revenue;Racinos: 0.5% ofgaming revenueOKLAHOMANoLand-Based: NoRestrictions onOperating HoursNumber of Licenses AllowedNumber of CasinosEffective Tax RateNoYesRacinos: Yes(May operate no morethan 20 hours a day)NoNoUnlimited613*11*2*9512112Land-Based: 37%–45%on electronic gamingdevice revenue; 10% ontable game revenue.Land-Based: 33% oncasino gaming revenueRacinos: 33.5% onelectronic gamingdevice revenueGraduated rate rangingfrom 35% on casinogaming revenue upto 10 million to 50%on gaming revenue ofmore than 70 millionLand-Based: 1.5mlicense fee everythree years; 50,000 annually9.25% on casinogaming revenue;17.5% on internetgaming revenue46.25% on electronicgaming device revenueCasino License RenewalTerm and FeeLicense renewal every5 years; fee of 500per electronic gamingdevice annually.Supplier LicenseRenewal Term and FeeGaming related casinoservice industryenterprise: 5,000every 5 yearsDistributor: 400annuallyMinimum InvestmentYesAdmissions TaxTaxation of PromotionalCredits (Y/N/Partial)Withholdings on Winnings 4,000 and 25 perelectronic gamingdevice annually.Racinos: average 65%on electronic gamingdevice revenueLand-Based: 500 perelectronic gaming deviceand table game annually.Racinos: N/ARacinos: 10,000every three years.Investigation feesGaming-relatedvendor: 15,000every three esYesYesManufacturer: 2,000 annually;Manufacturer: 10,000 annually;Distributor: 5,000annuallyNumber of licenses allowed* Assuming no additional racetracks open in the state.STATE OF THE STATES 2020 The AGA Survey of the Commercial Casino Industry11

State By State Regulations, Taxes & Fees (continued)PENNSYLVANIARHODE ISLANDSOUTH DAKOTAWEST VIRGINIA 2 million or 0.2% ofcasino gaming revenue,whichever greater, plusadditional 3 millionMin. 100,000 inaggregate annuallyUp to 30,000 transferredannually from state gaming fundSubject to annual appropriationof 150,000– 500,000,in amount determinedby the commission.Statewide Self-ExclusionYesYesNoYesGambling Age21182121PartialPartialYesNoComplimentary ns onOperating HoursNoNoNoNoNumber of Licenses Allowed132Unlimited5*Number of Casinos122225Land-Based/Racinos:55% on electronic gamingdevice revenue; 16% ontable game revenue.68.85–74% on electronicgaming device revenue;9% on casino gaming revenue53.5% on electronicgaming device revenue;Statutory Funding forResponsible GamingSmoke-Free (Y/N/Partial)Effective Tax RateCasino License RenewalTerm and FeeInternet gaming revenue: 54%on virtual electronic gamingdevice-type games; 16% onvirtual table games/poker.Casinos/Racinos: 1.5 millionevery five years;Casino-resorts: 150,000every five years.17%–19% on tablegame revenue35% on table game revenueN/A 200 and 2,000 perdevice annuallyGaming Vendor: 750 annuallyManufacturer or Distributor: 1,000 first year, 250annual renewalManufacturer: 10,000 annually; 500,000– 2.5 million annuallyInitial fees for Manufacturers: 170,000;Suppliers: 85,000;Supplier LicenseRenewal Term and FeeInternet Gaming Operators: 1 million. Renewalfees every 5 yearsManufacturers: 150,000;Supplier: 100 annuallySuppliers: 75,000;Internet GamingOperators: 100,000Minimum InvestmentNoNoNoNoAdmissions TaxNoNoNoNoTaxation of PromotionalCredits (Y/N/Partial)NoPartialYesPartialWithholdings on WinningsYesYesNoYesNumber of licenses allowed* Assuming no additional racetracks open in the state.STATE OF THE STATES 2020 The AGA Survey of the Commercial Casino Industry12

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STATE OF THE STATES 2020 The AGA Survey of the Commercial Casino Industry 3 This report is designed to provide a comprehensive overview of the commercial casino industry in each of the 25 states with legal commercial casino gaming. For each of the 25 jurisdictions, the report analyses gaming revenue and gaming taxes generated by