Gaming growth dips sharply Jan.-March
Pub Date: 6/1/2008
National economic jitters and the high price of fuel and energy may have finally hit Montana and the state's gaming businesses.
Third Quarter Fiscal Year 2008 (Jan. 1- March 31, 2008) gaming machine tax collection dropped from 6.47 percent growth the previous quarter to just 1.22 percent growth. This comes on the heels of almost five years of steady 5-6.5 percent growth.
The steep third quarter dip has the growth rate for the first three quarters of FY 2008 now at 4.37 percent.
Gaming taxes for the first three quarters of FY 2008 were $47,388,309 compared to $45,416,769 in the same three quarters the previous year.
That is a modest increase of $1.97 million.
For the last several years gaming business authorities have attributed the healthy growth rates primarily to the healthy state of Montana's economy, which has been at the top nationally for income growth and low unemployment.
But the evidence suggests Montanans, who typically drive greater distances in this vast state, may have finally felt the gas pump pinch and are reducing discretionary spending on entertainment.
Havre and Great Falls lead the state's major cities in gaming tax collection declines, perhaps somewhat due also to area farmers struggling to see winter and spring wheat crops emerge and flourish in the face of drought and cold temperatures. Great Falls saw gaming tax collection drop well into negative territory with a 6.71 percent decline reported by the Gambling Control Division, followed by Havre's 5.19 percent shrinkage.
Great Falls saw taxes collected go from $3.92 million in the third quarter of FY 2007 to $3.65 in the same quarter FY 2008, while Havre went from $958,410 to $908,667.
Hamilton was the only other of Montana's top 13 cities to see gaming tax collections decline, down 0.76 percent from $812,844 to $806,706.
Yet Helena, Miles City and Bozeman grew compared to last year. Helena was up 9.9 percent from $2.41 million last year to $2.65 million this year, Miles City was up 9.77 percent from $715,197 to $785,072 and Bozeman taxes grew 9.56 percent from $1.57 million to $1.72 million.
Rounding out the top 13 were Billings, up 3.51 percent ($7.71 million to $7.98 million)'; Missoula up 4.52 percent (from $3.83 million to $4.01 million)'; Butte up 3.24 percent (from $2.55 million to $2.63 million)'; Kalispell up 5.5 percent (from $1.87 million to $1.97 million)'; Whitefish up 0.58 percent (from $580,815 to $585,212'; Lewistown up 2.57 percent (from $438,993 to $450,264 and Columbia Falls up 3.31 percent (from $404,150 to $417,547.
The largest 13 cities were up just 2.87 percent collectively.
On the other hand, county totals were higher, edging up 4.48 percent.
When dealing with many of Montana's sparsely populated rural counties, the variations can be startling but are mostly anomalous. For example, if a new bar opens in Petroleum County, the number of gaming machines in the entire county may double.
Thus, you see Carter County gaming tax collections up an apparently remarkable 38.86 percent, however collection increased from just $9,876 to $13,718.
Counties that saw overall gaming tax collections increase were: Beaverhead up 3.15 percent, Big Horn up 2.39, Broadwater - 7.94, Cascade - 7.73, Choteau - 17.0, Custer - 9.76, Daniels - 16.92, Dawson - 4.55, Deer Lodge - 15.09, Fallon - 13.51, Fergus - 2.64, Flathead - 3.79, Gallatin - 8.47, Glacier - 15.11, Jefferson - 6.12, Lewis and Clark - 8.41, Lincoln - 7.12 and McCone - 10.93.
Also showing gains were: Meagher - 10.10, Mineral - 2.79, Missoula - 2.87, Musselshell - 5.47, Park - 2.36, Petroleum - 11.85, Phillips - 16.20, Powder River - 5.79, Powell - 3.80, Ravalli - 1.05, Richland - 7.08, Roosevelt - 7.57, Rosebud - 0.18, Sanders - 2.41, Sheridan - 15.82, Silver Bow - 8.12, Stillwater - 8.76, Teton - 0.40, Toole - 5.81, Treasure - 7.51, Valley - 12.69, Wibaux - 7.7 and Yellowstone - 5.60.
Counties showing declines were: Blaine - down 1.03, Carbon - 1.63, Golden Valley - 6.44, Granite - 2.07, Hill - 5.45, Judith Basin - 1.16, Liberty - 9.85, Madison - 1.06, Pondera - 4.67, Prairie - 6.11, Sweetgrass - 3.54 and Wheatland - 5.17.
Not surprisingly, Lake County posted a 95.85 decline as Class III Gaming came to an end on the Flathead Indian Reservation in late 2006.
The Gambling Control Division no longer posts gaming tax collections for the smallest cities. Since it is precluded by law from ever disclosing the gaming revenues for any individual business, in towns with just one or two operators that information would effectively be disclosed.
QUARTERS/REVENUE
Fiscal Year
2003
Quarter 1 $10,930,037
Quarter 2 $11,478,844
Quarter 3 $11.677,029
Quarter 4 $12,047,838
Total $46,133,748
2004
Quarter 1 $12,421,994
Quarter 2 $12,147,666
Quarter 3 $12,692,531
Quarter 4 $12,811,980
Total $50,074,170
2005
Quarter 1 $13,158,607
Quarter 2 $13,125,315
Quarter 3 $13,406,016
Quarter 4 $13,681,855
Total $53,371,792
2006
Quarter 1 $13,933,833
Quarter 2 $13,982,777
Quarter 3 $14,630,273
Quarter 4 $14,305,508
Total $56,912,391
2007
Quarter 1 $14,989,052
Quarter 2 $15,051,170
Quarter 3 $15,376,547
Quarter 4 $15,344,153
Total $60,760,922
2008
Quarter 1 $15,799,621
Quarter 2 $16,024,979
Quarter 3 $15,563,709
Quarter 4 -0-
Total $47,388,309
FY 07/08 Variance
Quarter 1 $810,569
Quarter 2 $973,809
Quarter 3 $187,162
Quarter 4 $1,971,540
FY 07/08 Variance
Quarter 1 5.41%
Quarter 2 6.47%
Quarter 3 1.22%
Quarter 4 -
Source: The Montana Tavern Times, June, 2008, published monthly by Continental Communications, 125 W. Granite St., Suite 102, Butte, MT 59701.