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4Q VGM revenue off 17.7 percent

Pub Date: 8/1/2010

4Q VGM revenue off 17.7 percent

    Like a tiring swimmer needing a rest, to touch the bottom may the best feeling in the world.
    And it is with considerable likely relief the licensed gaming business in Montana may have finally felt bottom in the last quarter of the fiscal year (April-June of 2010).
    Gaming revenues had seen unprecedented declines four quarters in a row: -4.3 percent, -5 percent, -18 percent and -21 percent. And now they have seen a fifth, according to preliminary numbers provided by the Gambling Control Division, but the good news is the rate of decline has been reversed from that peak 21 percent contraction to a more manageable negative 17.7 in the last quarter.
    However, Fiscal Year 2010 (July 1-2009 to June 30, 2010) may go down in infamy as the toughest in 30 years of state regulated gambling in Montana. Tax collections were down to $52.4 million for the year compared to $62.1 the year previous, a whopping $9.7 million or 15.6 percent shrinkage.

VGM tax comparison for municipalities
CITY 4Q 2009 4Q 2010 % change   3Q 2010 4Q 2010 % change
Belgrade $228,228 $175,599 -23%   $175,949 $175,599 0%
Billings $2,620,847 $2,234,442 -15%   $2,142,010 $2,234,442 4%
Bozeman $512,538 $400,050 -22%   $394,662 $400,050 1%
Columbia Falls $132,146 $110,108 -17%   $100,019 $110,108 10%
Deer Lodge $101,145 $81,291 -20%   $76,408 $81,291 6%
Dillon $100,958 $89,732 -11%   $79,912 $89,732 12%
Glendive $134,960 $101,755 -25%   $105,346 $101,755 -3%
Great Falls $1,356,981 $1,134,240 -16%   $1,171,023 $1,134,240 -3%
Hamilton $255,052 $196,974 -23%   $197,937 $196,974 0%
Havre $303,461 $239,682 -21%   $251,124 $239,682 -5%
Helena $861,946 $722,805 -16%   $700,166 $722,805 3%
Kalispell $627,517 $564,502 -10%   $510,895 $564,502 10%
Laurel $209,594 $165,510 -21%   $173,467 $165,510 -5%
Lewistown $149,396 $115,887 -22%   $117,261 $115,887 -1%
Livingston $168,467 $126,139 -25%   $124,333 $126,139 1%
Miles City $242,555 $209,012 -14%   $183,436 $209,012 14%
Missoula $1,298,220 $1,024,588 -21%   $1,060,262 $1,024,588 -3%
Sidney $236,926 $210,703 -11%   $193,095 $210,703 9%
Whitefish $175,651 $138,864 -21%   $135,063 $138,864 3%

    It should be noted that the recent year was among the worst in several generations for the state and national economies.
    Still, the 21 percent decline registered in the third quarter may represent the bottom of the trough. Though a 17 percent reduction in gaming business revenues for the fourth quarter isn't exactly a bright spot, the rate of decline did subside for the first time in five quarters.
    Besides the tough economy in general, negative impacts industry officials and licensees have most cited as reasons for the declines include the smoking ban that kicked in last October and a severe winter.
    Because the Tavern Times obtained the figures from GCD just before deadline, industry officials and licensees did not get a chance to see the figures in order to comment for this article. Look for a more in-depth analysis in the Tavern Times next month.
    The largest declines in the last year were registered in Glendive, down 25 percent to $101,755 from $134,960; and Livingston, also down 25 percent to $126,139 from $168,467.
    Belgrade and Hamilton recorded 23 percent declines; Bozeman and Lewistown fell 22 percent; Havre, Laurel, Missoula, and Whitefish all fell 21 percent.
    Cities with the least declines were Kalispell, down 10 percent to $564,502 from $627,517; Dillon, down 11 percent to $89,732 from $100,958; Sidney, down 11 percent to $210,703 from $236,926; and Miles City, down 14 percent to $209,012 from $242,555.
    The 15.6 percent drop in FY10 is the second annual decline ever recorded, following FY09’s fall of 2.2 percent. Previously, the state gaming revenues were up 4.4 percent in FY08, 6.8 percent in FY07, 6.6 percent in FY06 and FY05, a healthy 8.5 percent in FY04, and 5.6 percent in FY03.