Gamblers Play in California and Forget Reno Nevada

July 23, 2006 – It was the year 2000, and casino gambling revenues had hit an all-time high, nearly $859 million, won mostly from tourists driving from California into Nevada.

 

Then, 100 miles to the west, a hulking Indian casino opened with a gaming floor big enough to fill half of a Wal-Mart Supercenter. In the years that followed, tribal gaming helped siphon off nearly $600 million in business from its nearby competitors, taking jobs with it and forcing smaller casinos to close their doors.

It’s not a scenario of what could happen to Shreveport-Bossier City’s casinos if Texas expands gaming; it’s the reality facing Reno, Nev., a city of 200,000 residents on the slope of the Sierra Nevada Mountains in the northern part of the state.

 

“It was doom and gloom all the way,” Deanna Ashby, executive director of marketing at Reno-Sparks Convention and Visitors Authority, said of the early predictions of the impact California’s gaming expansion would have on Reno.

“Everyone knew it would hit the day-tripper coming over the hill, and it did,” said Michael Whitemaine, who last week celebrated his one-year anniversary as general manager of Shreveport’s Eldorado casino after spending 24 years working in Reno. “Revenues went down 15 or 20 percent immediately.”

Aside from a tumble in gaming revenue, the number of people working in Reno’s casino-hotel industry dropped by nearly a third since its peak six years ago.

Gaming analysts note that a variety of factors at work in the marketplace, the Sept. 11, 2001, terrorist attacks and the faltering of the California dot.com industry, for example took some wind out of Reno’s casino industry.

 

But having 2,700 slot machines and 98 table games almost the equivalent of two Shreveport riverboats in the Thunder Valley casino along the interstate linking Californians to Reno didn’t help either. Thunder Valley now grosses more than $400 million a year, nearly half of what Reno’s 23 casinos combined take in annually.

“Had there not been a California gaming industry, we would have been able to grow at the same rate as in the ’90s and be about one-third larger than what we are now,” said Bill Eadington, professor of economics and director of the Institute for the Study of Gambling and Commercial Gaming at the University of Nevada, Reno.

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