Casinos Not Paying Off for Indians

S A N  C A R L O S,  Ariz., Aug. 31, 2000 -- The plaque outside the Apache Gold Casino declares the $40 million hotel, golf and gambling resort has “helped enable the San Carlos Apache Tribe to give a better quality of life to its tribal members.”

But seven years after the casino opened — and four years after the debut of a glittering new complex — many Apache families still crowd in small apartments or mobile homes.

The reservation’s unemployment rate has climbed from 42 percent in 1991 to 58 percent in 1997, the latest year available. The number of tribal members receiving welfare has jumped 20 percent. And the tribal government still grants home sites without water and sewer connections.

“We get no help from the casino, no money, nothing,” said Pauline Randall, 75, a lifelong resident of San Carlos.

$8 Billion and Little Change

Similar complaints echo across the 1.8 million acre reservation in east Arizona, but they could just as easily be heard on many other Indian reservations across the country that have built casinos in the past decade.

Despite an explosion of Indian gambling revenues — from $100 million in 1988 to $8.26 billion a decade later — an Associated Press computer analysis of federal unemployment, poverty and public assistance records indicates the majority of American Indians have benefited little.

Two-thirds of the American Indian population belong to tribes locked in poverty that still don’t have Las Vegas-style casinos.

And among the 130 tribes with casinos, a few near major population centers have thrived while most others make just enough to cover the bills, the AP analysis found.

Despite new gambling jobs, unemployment on reservations with established casinos held steady around 54 percent between 1991 and 1997 as many of the casino jobs were filled with non-Indians, according to data the tribes reported to the Bureau of Indian Affairs.

“Everybody thinks that tribes are getting rich from gaming and very few of them are,” said Louise Benson, chairman of the Hualapai Tribe in northwestern Arizona, one of two tribes with casinos that failed during the 1990s.

Of the 500,000 Indians whose tribes operate casinos, only about 80,000 belong to tribes with gambling operations that generate more than $100 million a year.

The Ring of Success

Some of the 23 tribes with the most successful casinos — like the Shakopee Mdewakanton Dakota Tribe in Minnesota — pay each member hundreds of thousands of dollars a year.

In Scott County, which includes the Shakopee reservation south of Minneapolis, the poverty rate declined from 4.1 percent in 1989 to 3.5 percent six years later. The reservation’s unemployment rate also plummeted from 70 percent in 1991 to just 4 percent in 1997.

Such success stories belong mostly to tribes with casinos near major population centers.

The tiny Mashantucket Pequot tribe of Connecticut reported more than $300 million in revenue in the first five months this year from its Foxwoods Casino, located between New York and Boston.

And the Seminole Tribe’s Hollywood Gaming Center on Miami’s Gold Coast generates more than $100 million a year with pull-tab slot machines. The unemployment rate on that reservation, however, still was 45 percent in 1997, and the average poverty rate in the two counties it touches rose from 10.4 percent in 1989 to 12.1 percent in 1995.

Poverty Rate Rises

For many of the 130 tribes with Las Vegas-style casinos, like the San Carlos Apaches, gambling revenues pay for casino operations and debt service, with little left to upgrade the quality of life.

In counties that contain reservations with casinos, the poverty rate declined only slightly between 1989 and 1995, from 17.7 percent to 15.5 percent, the AP analysis founds. Counties with reservations with no gambling saw their poverty rate remain steady at slightly more than 18 percent.

Nationally, the poverty rate hovered at near 13 percent during the period.

In California, the Tachi Yokut Tribe in the San Joaquin Valley brags on its Web site that its Palace Gaming Center has provided employment for tribal members, helped raise education levels and upgraded housing.

But the poverty rate in Kings County, which includes the tribe’s small reservation, climbed from 18.2 percent in 1989 to 22.3 percent in 1995. The reservation’s unemployment rate dropped slightly to 49.2 percent in 1997.

Jonathan Taylor, a research fellow at the Harvard University Project on American Indian Economic Development, said many investments gaming tribes have made in social and economic infrastructure don’t translate into immediate improvements in quality-of-life indicators like poverty.

“You see investments arising out of gaming taking hold slowly in greater educational success, greater family integrity, greater personal health, greater crime prevention,” he said.

Signs of Hope

There are some optimistic signs that tribes hope to build on when the casino construction loans are repaid.

The analysis indicates casino gambling has slowed, though not reversed, the growth of tribal members on public assistance. Participation in the Agriculture Department’s Food Distribution Program on Indian Reservations increased 8.2 percent from 1990 to 1997 among tribes with casinos, compared with 57.3 percent among tribes without them.

And economic development has been spurred in communities near tribal casinos, according to an analysis of county business patterns.

The Oneida Indian Nation in central New York has become the largest employer in Oneida and Madison counties, thanks to a casino that’s generating more than $100 million in annual revenues. A championship golf course and convention center are under construction.

Unemployment Stays High

But the new jobs have not reduced unemployment for Indians. Tribes with established casinos saw their unemployment rate rise four-tenths of a point to 54.4 percent between 1991 and 1997, the AP analysis found.

Jacob Coin, former executive director of the National Indian Gaming Association, said that’s because 75 percent of jobs in tribal casinos are held by non-Indians.

At the Fort Mojave Indian Reservation along the California-Arizona-Nevada border, the unemployment rate climbed from 27.2 percent in 1991 to 74.2 percent in 1997.

Tribal administrator Gary Goforth acknowledged few of the 675 jobs at the tribe’s two financially troubled casinos are filled by tribal members. “Not everybody wants to be a dealer, or a housekeeper or even a manager in the restaurant,” he said.

San Carlos Apache Tribal Chairman Raymond Stanley said about 80 percent of the 360 casino resort employees are tribal members. He said the casino also provides a $65,000 monthly dividend to the tribe that has paid for seven new police cars and small clinic.

But Stanley said it’s not enough to meet the needs of the 10,500 tribal members, 6,000 to 7,000 of whom remain on public assistance. Because the tribe’s unemployment rate remains above 50 percent, it is exempt from the 1996 welfare reform law that limits recipients to five years.

“We really don’t have a lot to show for it at the moment,” he said. “The real benefit right now is employment.