Iowa’s commercial casinos post record revenue year
Source: Cedar Rapids Gazette/Quad-City Times
Iowa’s 19 state-licensed casinos reported adjusted gross revenue of nearly $1.58 billion via their slot machines and table games and a separate sports wagering handle of over $1.2 billion that netted them nearly $90 million in receipts for the 12-month period ending June 30, according to the Racing & Gaming Commission.
Casinos took in about $141.5 million in June to post a yearly record that topped the previous high of nearly $1.47 billion in fiscal 2012 by more than $109.4 million. The fiscal 2021 figures represented a huge rebound for casinos that saw revenue dip to $1.16 billion during a COVID-19 ravaged year in which the pandemic forced them to close for 11 weeks under the state’s public health disaster emergency.
“I think it was a lot of pent-up demand,” said Wes Ehrecke of the Iowa Gaming Association, an umbrella group for the licensed casinos in Iowa. “It’s a positive sign that we’re closer to back to normal. Favorable weather, availability of COVID-19 vaccinations and more discretionary money earmarked for entertainment as Iowa’s farm and overall economy rebounded were all factors contributing to a turnaround from last year’s 20 percent revenue decline,” he said. "It all just kind of came together,” said Ehrecke, “especially during the second half of the fiscal year.”
“It was big numbers,” said Brian Ohorilko, administrator of the state Racing and Gaming Commission, who noted that many casino operators are still in the process of rehiring employees, renting venues and providing amenities that were shuttered during the ongoing pandemic.
“It would have been hard to have guessed that the industry would have done this well given where we were at a year ago,” he noted. “It was a tough situation for many of the operators. It’s really a good spot right now.”
Ohorilko said many state-licensed casinos are doing “much better than they would have anticipated in terms of a recovery at this point in time,” and are cautiously optimistic about the future. Many used the pandemic to “reset” their marketing strategies to target promotions “to the seasoned gamblers instead of maybe casting a wide net” given the yearly trend toward reduced admissions.
“It might be difficult to sustain this record level,” Ehrecke noted, “but it’s encouraging that we can get back to the consistency that we had pre-COVID.”
Sports wagering, which saw its first full fiscal year since the activity was legalized in Iowa beginning in August 2019, generated nearly $111.2 million in bets last month to surpass the $1.2 billion mark for fiscal 2021. More than $985 million in wagers were placed using online apps after Iowa’s law changed Jan. 1 to allow betting over electronic devices without requiring players to first travel to a casino to set up an account in person.
The increased betting action proved profitable for the state as well, with casinos paying $314.5 million in state taxes on gambling at their facilities and $6.07 million in state taxes on sports wagering proceeds.
June saw the pace of sports wagering in Iowa drop for the third consecutive month even as revenue jumped, according to analysts from PlayIA. Even so, the overall $1.2 billion handle will become the yearly benchmark, said Ehrecke, adding “I hope we can get to that same level next year and beyond.”