Potential Impact of Indiana’s First Tribal Land Casino

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Sunday, September 24th, 2017 | Written by Stephen Smith

Soon after the Pokagon Band of Potawatomi Indians opened the Four Winds Casino Resort in Michigan back in 2007, the Indiana-based Blue Chip Casino Hotel Spa located a mere four miles away took a hit to its business. One year later, and the Blue Chip Casino’s revenue plunged by $58 million, ultimately leading to the loss of 165 casino jobs at the venue.

Nevertheless, there is now more troubling news ahead for the Michigan based casino, as well as the Great Lakes State’s 10 riverboat casinos dotted along the Ohio River and Lake Michigan, as the Pokagon intend to open up another gambling establishment, this time in South Bend, which will be the first Indian casino based on land in Indiana.

Tax Exempt

The Four Winds Casino in South Bend is scheduled to open its doors in the early part of 2018, causing concern amongst already established casinos that it will siphon off even more business from their operations. Furthermore, the state is likely lose a significant amount of casino tax revenue as tribal casinos are exempt from paying gambling taxes. The development couldn’t have come at a worst time, either, as the state’s casinos are already dealing with increasing pressure from competition across its borders in neighboring states.

In fact, casinos tax revenue directed towards the state general fund has contracted by a huge 35 percent, or $237.4 million, over the last seven years, with the impending drop following the new casino’s opening forecast to be even worse. While expected to be a major game changer, the worst hit is still likely to be experienced by the Michigan Blue Chip Casino Hotel.

Unfair Competition

While the Potawatomi already run three casinos in Michigan, the Four Winds Casino will be Indiana’s first ever tribal casino. Needless to say, being excused from paying a 35 percent tax on their gross gambling revenue has raised huge concerns amongst their Indiana competitors. As Casino Association of Indiana (CAI) executive director Matt Bell, explains:

“They are good operators. They would be a rival with a level playing field, but the field is not level. They can pump a lot of that money into marketing through promotional free play. It allows them to market far more aggressively than Indiana casinos can today.”

Tribal Benefits

The Four Winds Casino will help improve the economic development of the 5,000 Pokagon citizens that are spread out throughout the southern portion of Michigan, as well as the northern parts of Indiana. The tribe was scattered and dispersed until 1994 when it was finally granted federal recognition following decades of efforts. Over the ensuing years, the Pokagon has subsequently constructed homes for numerous members of its tribe, in addition to three casinos based in Michigan, with tribal chairman John Warren explaining:

“It’s because of the Pokagon band’s tribal council and also advice and the wants and needs of our tribal citizens that we engaged in gaming. And it’s just a success story from there. Most of the infrastructure and most of the services that were built in the last 10 years is because of Four Winds.”

John Warren also added that the casino’s opening will be the first time in two centuries that Indiana will have “Indian country,” which is something that both communities should be very proud of.

Four Winds Casino in South Bend

The new casino in South Bend is expected to be 175,000 square feet in size, and have a similar appearance to the one already based in New Buffalo. It will also offer employment to around 1,200 people, with its features including 1,800 slot machines, three bars, several restaurants, and a coffee shop. Furthermore, the casino’s architecture and decor will draw inspiration from the history of the tribe, while native baskets will be on display, along with a continually burning fire that represents the fires used in Potowatami ceremonies.

Worrying Times Ahead

There are many concerns surrounding the opening of the Four Winds Casino in South Bend, especially as to what will happen to the other casinos based nearby once it gets up and running next year. Only time will tell, but in the meantime it is fair to say that these existing casinos have plenty to be nervous about right now.