In Connecticut, the budget has become dependent on the amount of revenue coming in from its two giant casinos. But times they have been a-changin’ these past five years.
Saturation of gambling availability has been beaten to death in the U.S.A. – and why not, every year it shows it’s a serious concern.
According to the facts and figures presented by David Schwartz from Center of Gaming Research at UNLV, since this year began both casinos combined have a -3.46% decrease since a year ago. Separately, Mohegan Sun seems to have held its own with a +.51%, while Foxwoods has seen a change of -8.05%.
One more recent report, according to the Connecticut Gaming Commission, Foxwoods’ slot payout average is 91.85 percent. Mohegan Sun pays back at a rate of 91.71 percent. That means Connecticut has the eighth-highest payout rate of the 20 states requiring casinos to report. (Which is less than half of the states that have legalized casino gambling.) However, in many ways, what news reporters don’t tell you is that comparing states revenue is like comparing apples to….tomatoes. Both are vegetables, but they are really aren’t looked in the same way.
Video poker, for example, is figured into the stats in Nevada. Most video poker has a calculated payout % between 95% and 99%. CT does not report Video Poker, just slots, whose payout % rivals that of the top 7 listed in that report. If they were listed, the CT casinos % would be higher, as well as others in the bottom half.
In Michael Sokolove’s article three years ago in the New York Times (March 2012), he mention’s how CT’s casinos might have mis-read the industry future in New England and beyond (New York). Amidst his long and fascinating article called “Foxwoods Is Fighting for Its Life” Mr. Sokolove mentions that in 2012, Foxwoods had 6300 slot machines, and Mohegan Sun had less, but still over 6000. CT had a total of over 12,000 little robots making money for its coffers.
But in Professor Schwartz’s report, the total number of units now being reported is Mohegan Sun – 5,264, Foxwoods – 4770. So, in the past five years, approximately 2000 little robots (slot machines) have been taken off the casino floor. For a comparison, think of this – the new Plainridge Park Casino only has 1200 slots. Combined, Foxwoods and Mohegan Sun have taken enough slots off the floor to fill an entire casino !
So, why less slots? – to consolidate their casino floor, make space, change the floor layout, add bars – you name it. There could be many reasons, but I can tell you that it it wasn’t worth keeping all 6000+ machines on the floor financially for the casinos. Simple.
How much does a slot machine make in a day. Ok, so, I’m going to go out on a limb here because there are so many things to finding an average payout for a slot machine, so depending on:
- Slot % machine is programmed to payout over a long period of time due to its RNG
- Slot % it actually pays over a short term – day, week, month
- Denomination – penny, nickel, dollar, etc
- Money played through without including winnings
- Number people playing it
- Day of the week, time of the year
- The “Handle” – Total amount bet on slots in the period in question
- The “Win”: Cash-in minus payoffs; the amount the casino(s) kept
- The “Hold %”: Percentage of cash-in retained by casino as win
I will attempt to show how much less the state of CT is getting from the 25% slot payment from these two behemoth casinos. (**Please note – to get the following figures, I am just choosing a lower figure than what I found from various internet sources that both tried to mathematically and statistically guess to come up with the average money-making day for a slot machine.)
The average slot machine can make at least $100,000 a year**, based on a possible single day’s play. So this past year, CT could have lost up to (see how vague I’m being) possibly (2000 x $100,000 =) $2,000,000,000 in slot revenue missing from the Connecticut state budget. Not because Foxwoods and the Sun wanted to, but they had to.
This is why Massachusetts is such a financial threat, and why Mohegan Sun & Foxwoods are trying to team up for an additional casino on the Mass/Conn border. However, it wouldn’t be needed if Connecticut wasn’t so tied to gambling like so many other states.
So I am finishing the way I started…..
In Connecticut, the budget has become dependent on the amount of revenue coming in from its two giant casinos. But times they have been a-changin’ –
Well, something’s gotta change!
That’s all for now. Special thanks to Dr. David Schwartz and his amazing work at the Center for Gaming Research at UNLV. You continue to inspire with your articles and posts. If any of my NETG friends are interested in the history of gambling, Las Vegas, or similar historical reflections, check out his publications and books. My favorites are “Roll the Bones” and “Grandissimo.”